Social Security and Ponzi Schemes

I have not met anyone who has not heard of Bernie Madoff who as we recall “made off” with millions of dollars in the highly publicized ponzi scheme. My rhetorical question to you is, was this a bad thing? If his investors were making double digit gains in a market where people were sending their money out with the bath water, is he really the devil? I hate to say it but all of us, the American workers will all be involved in a legalized version of what Madoff just did. How you ask? Your ethics would never allow you to participate in such a travesty? That is what I said until I started researching the American Social Security Program. Now before you dis-engage, take a look at some facts.

• Those paying into the program today and supporting those who are subsequent [The young (new working Americans) pay into the program and the old (retired American) receive money from the program]

• No guarantee of future performance or return

• Returns are paid based on workers payments and not by profit return or investments

A ponzi scheme pays those who began the scheme with the money from new investors. Although this argument has been made time and time again, It’s requires attention in every medium it can. I am not calling for the end of Social Security, just an appreciation to the rhetoric that apposing side may have. Why is it legal for the government and bad for the Private sector? Don’t answer with emotion, try logic.