Is Social Security a Ponzi Scheme?

Discussion in 'Politics' started by Salty, Sep 15, 2011.

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Is Social Security a (legal) Ponzi Scheme

  1. Yes it is

    3 vote(s)
    27.3%
  2. No it is not

    7 vote(s)
    63.6%
  3. Not sure

    1 vote(s)
    9.1%
  1. Salty

    Salty
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  2. billwald

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    >A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi scheme organizers often solicit new investors by promising to invest funds in opportunities claimed to generate high returns with little or no risk.

    Nothing in the SS law refers to investments or returns on investments.

    In Ponzi schemes the suckers are told the money will be invested in some kind of business. The SS law clearly states and requires that excess SS funds be replaced with Treasury notes and the excess cash be placed in the Treasury and spent on current budget needs.

    I challenge anyone who thinks SS is a Ponzi scheme to explain exactly what should have been done with he money.

    Should Fort Knox be filled with cash? Should the SS Administration have bought real estate or stocks? Gotten a seat on the NYSE?
     
  3. targus

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    It should have been either not set up to start with or the money should have gone into individual accounts under the control of the individual - much like an IRA account.

    BTW - anyone with an ounce of investment sense knows that you don't put everything into one investment as the government has done with our money.

    It should have been privatized - Bush was right. :laugh:
     
  4. freeatlast

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    It is not a ponzi scheme and no and there is nothing wrong with SS that removing these crooked and irresponsible politicians who have been bleeding it dry to support their pet programs, and returning it to its orginal intent will not fix.This claim thta it is a ponzi schem is another reasoin to look long and hard before supporting Rick Perry.
     
  5. targus

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    There are currently 1.75 persons contributing for every 1 person collecting social security.

    In the next ten years with the boomers retiring it will only get worse - much worse.

    How do you expect that to continue?

    As a ponzi it requires ever increasing numbers of new people in the system to pay for it.

    As a ponzi it will eventually fail for that reason because there are a limited number of people in the world.
     
  6. freeatlast

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    [SIZE=+0][SIZE=+0][SIZE=+0]I assume that you are not aware of what has happened to the system since you have given the standard political response that comes from these corrupt and irresponsible politicians. They have robbed the system and now are blaming the problems on the system to cover up their theft.

    First the system does not have a separate account. Any extra money in the system has been syphoned off in the past and 2.4 trillion in IOU''s in the form of un-payable bonds, and even the bonds are bought with IOU money, have been put in the place of the money. So the politicians are basically looking for a get out of jail free card for their irresponsible actions by blaming the system instead of admitting what they did.

    Also originally the system was set up for only monthly checks to the retired. Now it covers surviving children, the disabled and more. This needs to be corrected and return to the original intent of the system as well as set it up so that these corrupt and irresponsible politicians cannot get their greedy hands on a dime of the money to pay for their irresponsible projects.

    The ratio of pay in to pay out you gave with a set date is miss-leading. The truth is that these baby boomers are going to start to die off, and in fact it is already happening. As more and more of these people die off, and at a faster rate over time, within ten years the ratio will start to stabilize especially if the fund mismanagement is corrected. Also returning the fund to what was intended and putting a stop to congress ripping off the fund with their pet projects the pay in will again be higher then the draw on the system.

    So the problem is not with the fund as intended. It is with these corrupt and irresponsible politicians who have been robbing the fund. It could be immediately stabilized if they return it to what it was intended for and the rest would take care of itself. SS in fact has been a success until the political leaders realized it was an extra bank vault that they could raid at their convenience. That also has to stop.

    So no it is not a Ponzi. Any such claim is irresponsible and false. It is a miss-managed fund by corrupt and irresponsible politicians. The claim of Ponzi is not new, but to date it is a Rick Perry thing for political gain and I hope it bites him in his political rear. Also what he proposes in the place of SS is a ship wreck.


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    #6 freeatlast, Sep 16, 2011
    Last edited by a moderator: Sep 16, 2011
  7. HankD

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    Again, I agree completely with FAL.

    What is an additional point of grievance is that "we the people" who are recipients of SS have all of our working lives contributed approx. 14% (with employer contribution, all if you are self employed) of our income into the system only to be told we are part of the so-called "Ponzi Scheme".

    My wife and I have other retirement assets, that is not the point.

    Rush Limbaugh at one time was calling it a form of welfare.

    The government was not ashamed to mandate/require the 14% from me (I have been self-employed most of my working career).
    Now when I become the recipient, I am going on "welfare"?

    Easy for a multi-gazillionaire to proclaim it a "welfare" plan.

    Die the day before your and/or your spouse's 62nd birthday and all is lost (would have been hundreds of thousands of dollars in the case of my wife and I).

    I am however thankful to the Lord that my wife and I have lived to reap the fruit of our labor under this "Ponzi Scheme" so-called.

    FWIW, we are the owners of many of those T-Bills.

    Yes, it must be reformed and that is the the place where wisdom must prevail.

    Let's see what Perry offers forth as a solution for "we the people".

    HankD
     
    #7 HankD, Sep 16, 2011
    Last edited: Sep 16, 2011
  8. billwald

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    >BTW - anyone with an ounce of investment sense knows that you don't put everything into one investment as the government has done with our money.

    Get it out of your thick head. SS doesn't claim to be an investment fund.

    Bottom line that no Republican will admit is that the majority of Americans are mentally incapable of saving/investing enough to take care of themselves when they are to old or to frail to work.
    You all must be Social Darwinists who are content to let them eat out of dumpsters and die. After all, letting the poor people freeze and starve cleans the gene pool.
     
  9. Salty

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    Are you saying that there are NO Christian organizations that help the poor, the needy - even the greedy?

    Lets see to start with, The Salvation Army, The Rescue Misison, The Church Army , countless local church food closets, and the list goes on.
     
  10. FundyPat

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    No, Our Government in it's current forum, is a Ponzi Scheme. With the big ear Barnie Madoff in the White House.
     
  11. billwald

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    >Are you saying that there are NO Christian organizations that help the poor,

    I'm saying that if private charities had been sufficient then there would have been no need for SS. Republicans prefer to see old people on welfare/charity than collecting SS. This way Republicans can boost their own egos and sneer at poor people on the dole. As one good Christian put it, "God created poor people so we can give them charity." Republicans forget that "charity" meant "love" and not giving pennies to poor people.
     
  12. Salty

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    Actually, I think we got off subject here a bit.
    First of all, SS was never meant to be the total income - it was stated it would be one leg of a 3 legged stool. The other 2 would be savings, and company retirement.

    But back to charity - a lot of govt "charity" goes to non-retirement age people. There is a difference between govt give-a-way and private (esp Christian) charity. There is no accountability for govt give-a-way. Often with Christian charity there is an accountability requirement, in addition, the charity may require participation from you.

    Habitat for Humanity is a perfect example. The family receives a brand new home (with low interest an payment. In addition the family is required to volunteer x number of hours with other new homes - thats a "ponzi system" in reverse.
     
  13. th1bill

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    This is going to be a much debated issue but for myself, no, for the young folks of today, yes!

    There are a number of problems, nobody wishes to discuss that have direct bearing on this issue. Birth control in any form reduces the number of future taxable income. When SS was set up, before all the add-ons were put in place it could never have gone broke except that things changed.

    Then, the funding for the Korea War was needed and they removed it from SS. It seemed like a good idea at the time, take it for the war and replace it after... they never did so! then we fought my war, Vietnam and with the cost of building the Great Society, Lyndon needed funding... They opened the SS again and did not replace it. If they had in either case or even in both, the treasure chest would still have run dry, just later than now.

    If they had replaced the money the interest from the World Bank was still lost for the years it was not there. And today the projected population is nowhere near the projection... less tax payers.
     
  14. righteousdude2

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    If It's a Ponzi Scheme, Please.....

    ....Don't reveal it until after I die :laugh:
     
  15. billwald

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    >Then, the funding for the Korea War was needed and they removed it from SS

    Not exactly. Not the whole truth. One of FDRs reasons behind SS was to raise funds for his CCC and other make work programs. Excess SS funds are put into the Treasury by legislative mandate.
     
  16. targus

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    Hey billwald, what is the difference between having the fruits of your labor taken from you involuntarily to be put into a program that you may never collect from - and slavery? :smilewinkgrin:
     
  17. AresMan

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    Why is that? Maybe because people have become dependent on the idea that they have guaranteed retirement in a government fund? Moral hazard has a way of doing this. It encourages people to live their lives irresponsibly and not plan for the future because they believe the government will guarantee it. Let's not put the cart before the horse. ;)

    Appeal to emotion.

    How in the world did we survive as a nation before Social Security was implemented from the '30's? Even then, it was very different from what it is now. Could it be that people back then were smarter to save for their own retirement because they did not have a government confiscate-and-spend program to change their behavior? Could it be that churches and charities gave for the same reason?

    You see, government programs destroy charity and eliminate the vestiges of altruism. They disconnect givers from recipients. Because of this, they allow many people to game the system. They make people dependent on government rather than themselves, their families, or charities. They feed themselves and encourage corrupt politicians and "benevolent dictators."


    I have been offering an "open" deal to the government for several years. I have been working for over 14 years (yes, I'm relatively young here). Here is the deal: let me opt out of Social Security now, and I agree to forego any "benefits" of the program. The government can keep all money that I have paid into it thus far, no strings attached. Think the government will accept this deal? No? Why not? Think about it.
     
  18. Salty

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    Aresman, I think you gave an excellent answere

    Did you know that minister may opt out of SS?
     
  19. AresMan

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    Yes, which also shows how flawed the logic of the program is itself.
     
  20. th1bill

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    CCC was very pre Korea.
     

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