Social Security = Ponzi Scheme

I love the lazy media’s reaction to Governor Rick Perry, Republican Presidential candidate, calling the Social Security system a Ponzi scheme. Naturally they miss the qualification the Perry puts on his comments, that current recipients and those who are poised to join the system have nothing to worry about, but it is the young workers just starting out that are being taken to the cleaners by this huge lie.

For those clueless media types and their Liberal friends who like to scare old people into thinking that anyone who talks about changing Social Security really wants to take it away…let me share this definition of a Ponzi scheme…

A Ponzi scheme is a fraudulent investment operation that pays returns to separate investors, not from any actual profit earned by the organization, but from their own money or money paid by subsequent investors. The perpetuation of the returns that a Ponzi scheme advertises and pays requires an ever-increasing flow of money from investors to keep the scheme going. The system is destined to collapse because the earnings, if any, are less than the payments to investors.

Does any of that sound like Social Security? HELL YES IT DOES! The last I checked, the actual rate of return on the money that people invest in the social security system is about 1 to 1.5 percent. The need for an ever-increasing flow of money sounds oddly familiar when it come to the social security system.

So is Rick Perry some big dumb cowboy, like the lazy media would have you believe, or is the guy right on?