Is Social Security really a Ponzi scheme?

[Mastro]

As candidate Perry claims. Please keep the politics out of it. Just looking for some thoughts on the health/prognosis/future of SS#

[iamntxhunter]

I would say if it can't be liquidated and every one get their money back that has been paid into it then it is a scheme of some kind. Call it what ever you like but it isn't a healthy account with honest accountants.

[Pablo Honey]

yes.

[bowhuntntxn]

By definition it is. Because it is paying dividends to people using other people's investment, and not self earned profits. The SS system is not making investments that create a profitable return, but sending Billy's money to Jill and not keeping any to send back to Billy when it is his turn for it.

The catch here is that the majority of voters are SS eligible or currently receiving benefits from the current SS system. So by pointing out the Ponzi part of it, and wanting to totally scrap the program will anger the voting majority. The ones who promise to keep it in tact will look like a savior to the voters, and will continue to complain about how the system is not self sufficient and will run out of funding. The younger generations, including my own, will not be able to correct the flawed system of the past, and turn it into a profitable nationally run retirement plan.

[cosmiccowboy]

It is in my opinion. For many years they have collected the money where revenue exceeded expenses. They have known forever that this would eventually change as the baby boomer aged and that ultimately expenses would exceed revenues. The extra money that was collected was not "saved in a lockbox". It was used to purchase IOU's from the Federal government which then spent the money. That surplus money is long gone. This was not a Republican or Democrat thing...both parties were equally guilty. The SS system is the Federal governments biggest creditor. Now the day is coming when the Federal government is going to have to "pay up" and turn those IOU's into real money...trillions and trillions of dollars. The question is, How are they going to do that without radically cutting other spending and radically raising taxes?

[BrandonA]

Yes by the very defintion:

Fruadulent investment operation that pays returns to seperate investors, not from any actual profit earned by the organization, but from their own money paid by subsequent investors.

[cntryislandboy]

i'm only 30 but i have no intention of ever seeing a dime of social security

[Dr. Evil]

I'm soon to be 48 and started when I was 20 to save for my retirement. Not counting on the Feds to have anything left for me and my wife in 12 years.

And yes, it qualifies as a "ponzi scheme".

[Saxet Nomad]

Well on the last Social Security annual statement that I got, it stated that at the current benefits payout, by the time I'm old enough to draw, there won't be enough funds there. I personally think that social security, just like welfare, were good intentions when they were implemented, but has been been abused over the years.

[Acts 10:13]

As a country I feel we need to take care of our own first, if we have have $$$ left then assist the other nations as we can. Sending our cash to assist other nations when we can't take care of our own is wrong. I would stop the aid to others and get our budget in line. SS is broke, pay everyone back what they have put in with a 5% interest rate and let grown people take care of them selves.

[Coach W]

i'm only 30 but i have no intention of ever seeing a dime of social security

I feel your pain... We are in the same boat... Start investing in your own retirement if you havent done so all ready because it aint gonna be there when we get there!

[Bisch]

The problem with SS is the thieves. SS was set up at first so the money could not be used for anything else. Then the politicians saw all that money piling up and could not stand it. They robbed the money from SS with the promise that the system would not be hurt. Well, they were either wrong or lied. If SS money had not been taken out and spent on other things that system would have more money than they would know what to do with. It would be the best public retirement system in the world. I could go on and on but it would do no good.

Bisch

[az2tx]

Without a doubt, if the gov wasn't doing it would be illegal.

[jerp]

The biggest problem is one of changing demographics. In 1945 there were 42 workers for each Social Security recipient. In 1950 after program coverage was expanded, there were 16.5 workers for each retiree. Currently there are 2.9 workers paying money in for every recipient taking money out. That ratio will continue to shrink as boomers like me retire and our national birth rate stays barely above the replacement level. What Perry says is true but if he wants to get elected he better spend as much time proposing solutions as he does bashing the current system. Politicians have been kicking this can down the road for decades because they know they will be out of office before it collapses but we will pay the piper someday.

[JW]

I feel your pain... We are in the same boat... Start investing in your own retirement if you havent done so all ready because it aint gonna be there when we get there!

Yes sir. I will be 39 this november. Doubt I will ever see one red cent of what I paid in. Now Im scared to death to invest in anything. I have friends that have lost 40% out of their 401k's. This is just horrible. I dont believe the American Dream is dead. But whats left of it the life is slowly being choked out of it. I soooo hope im wrong on that.