Treasury Bond sales A Ponzi Scheme?

From Washingtonsblog.com

Are U.S. Treasury Bond Sales a Ponzi Scheme?

I have heard at least 5 different theories by very smart people about how
U.S. treasury bond sales are being faked.

I do not have either the background or the inside knowledge to be able to
comment on whether any of them are true.

(1) PhD professor of economics Michel Chossudovsky - who is a very savvy
observer of international dynamics - claims in an interesting 8-minute
video:

In a bitter irony, the recipients of the bailout under TARP and Obama's
proposed $750 billion aid to financial institutions are the creditors of the
federal government. The Wall Street banks are the brokers and underwriters of
the US public debt, although they hold only a portion of the debt, they transact
and trade in US dollar denominated public debt instruments Worldwide.

They act as creditors of the US State. They evaluate the creditworthiness
of the US government, they rank the public debt through Moody's and Standard and
Poor. They control the US Treasury, the Federal Reserve Board and the US
Congress. They oversee and dictate fiscal and monetary policy, ensuring that the
State acts in their interest...

While the Federal Reserve can create money "out of thin air", the
multibillion outlays of the Treasury (including the Bush and Obama bank
bailouts) will require the emission of public debt in the form of Treasury Bills
and government bonds. Part of these T-Bills will of course also be held by the
Fed.

US financial institutions oversee the US public debt. They are involved
in the sale of treasury bills and government bonds on financial markets in the
US and around the World. But they also hold part of the public debt. In this
regard, they are the creditors of the US government. Part of this increased
public debt required to rescue the banks will be financed or brokered by the
same financial institutions which are the object of the bank rescue plan.

We are dealing with a pernicious circular relationship. When the banks
pressured the Treasury to assist them in the form of a major bank rescue
operation, it was understood from the outset that the banks would in turn assist
the Treasury in financing the handouts of which they are the recipients.

To finance the bank bailout, the Treasury needs to run a massive budget
deficit, which in turn requires a staggering increase of the US public debt.