"GOP Sen Ron Johnson calls Social Security a "legal Ponzi scheme". Ted Lieu #693
I'm not so sure. How does Johnson define "legal"?
I thought I'd read congress failing to keep Social Security revenues separate has questionable legal basis.
In fact iirc that was not how Social Security revenues were originally handled. BUT:
it was a -short term gain for long term pain- "solution" to budgetary shortfall which then current MOC agreed to, knowing the members of congress that made that choice would be retired before the shortfall resulted in the red ink pyramid actually collapsing. [insolvency]
Pon·zi scheme (pŏnzē)
n.
A fraud disguised as an investment opportunity, in which initial investors and the perpetrators of the fraud are paid out of funds raised from later investors, and the later investors lose all funds invested.
[After Charles Ponzi (1882?-1949), Italian-born speculator who organized such a scheme (1919-1920).] * |
So if Sen Johnson erred here, perhaps if at all in technical detail. His overall warning seems fairly accurate.
And the problem with such scams, they inevitably crash, as those familiar with Bernard Madoff should know.
Part of the problem:
those tangled in, entrapped by the Social Security scam were victimized at gunpoint.
It doesn't make sense to punish the victims further by pulling the $rug out from under them, particularly those that are near or in retirement.
SO !
While I appreciate Johnson's candor, and
Sen Lee's objective, I believe an ethical / equitable draw-down / phase-out is the best approach.
I UNDERSTAND !
When citizens fail to prepare adequately for their own retirement, they risk becoming wards of the State. That means, government's responsibility to support them. BUT !!
That doesn't mean Social Security is either the only, or the best option.
Government should regulate, not administer such programs.
The transition to a privatized system that gets Uncle Sam out from $under should be orderly, ethical, & equitable.
President sear would administer the replacement on an opt-out basis. Any wage earner that does nothing automatically contributes to a privatized fund, where their own contributions are held in trust for them. No Ponzi. No pyramid.
Citizens that would prefer a 401k option would be relatively free to do so, provided the alternate retirement investment met sensible government requirements: no "investing" in lottery tickets, or Brazilian llama farms, etc.
And btw, Social Security is not the only U.S. federal "entitlement" program careening toward the big -
sqwarsh - . Cited examples include Social Security, Medicare, & even our Highway Trust Fund.
ref:
pyramid scheme
n.
A fraudulent moneymaking scheme in which early participants are paid out of money received from later recruits, with the final recruits putting money in and getting nothing back. * |
* The American Heritage® Dictionary of the English Language, Fifth Edition copyright ©2022 by HarperCollins Publishers. All rights reserved.