The Glade 4.0

The reason I don't think it's appropriate to label SS as a Ponzi scheme is:

1. Ponzi schemes don't have any investment income, while SS does. At least I've never heard of one that did. Madoff had no investment income, he was essentially doing the "big pile of money" thing without doing any investment at all.
2. Ponzi schemes pretend they have money they don't have. SS is telling everyone that there's not enough money to pay out, and that they will have to pay out less.
3. The problem is inherent in the setting of the retirement age despite increasing longevity. If I were to go back in time and magically change the retirement age to 70, today SS would be solvent, would not need to use new money to pay old money, and not be considered a Ponzi scheme, despite the fact that nothing else about its structure and function has been altered.
4. It definitely wasn't designed as a Ponzi scheme to begin with, the only reason it's labeled as such now is because the mechanics haven't been updated. Social Security used to make a profit, and did not need to use new money to pay out old money. On average, the amount each individual used to pay in plus interest earned was was more than the amount they would get back after retirement. While you're technically correct that the exact specific dollars that an individual paid in were actually used to pay out someone else's benefits, and then that individual would be paid with dollars paid in by someone else, people were still collecting less from SS than they were paying in. It wasn't like Madoff's scheme where he'd just take investor money, siphon off a cut for himself and then pretend all that money was still in an account and pretend it was earning interest. In say 1960 they could have abolished the payroll tax that year and still paid everyone who had paid in more than what they had paid in. "New money" would not have been required.
5. Even in its current state, SS isn't actually using new money to pay out old money, it's actually using older money to pay out old money. That is, the profit made by the 40s generation because they died "young" is being used to pay the benefits of the 60s generation that died older.

Also, I'm not sure how you can claim the trust fund is actually -$49 trillion. To me, this is like claiming that a company that has $100 million in cash now, and is expected to earn $500 million in profit over the next ten years, but has $1 billion in bond payments coming due in ten years, has no money. The fact that their projected liabilities exceed what they are projected to earn doesn't mean they have no money now.

To steal from Stathol:

Today I learned that otherwise intelligent people generally refuse to understand common rules, regulations, common practices, and even redimentary definitions used to define those systemic bindings when it comes to finance, investment, and economics.

You aren't industry experts, and have, quite frankly, precluded yourselves from even minimal employment in the field with your enthusiastically defended erronious positions.

This thread has been difficult to endure. Vindi has far more patience than me.

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Ezekiel 23:19-20 

1) I don't think it's appropriate to say that the Swiss live in Europe because European countries have a seacoast, and Switzerland doesn't have one.
See, I can do that too. Whether you think it's appropriate, or not, is irrelevant. Changing the definition to suit yourself doesn't make it so.

You have no idea what Madoff, or any other person who ran a Ponzi Scheme, invested in. As a matter of fact, the guy whom the scheme is named after bought investment instruments to begin his scheme. Whether or not something is a Ponzi Scheme isn't dependent upon the amount of investment, it's dependent upon how the disbursements are paid.

I'll say it one last time: "A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors."
Further, when the SEC answers why Ponzi Schemes collapse, the answer is:

What's the problem with SS again? Oh, that's right, too many people cashing out and not enough new investors.



What are those securities? You say they're Treasuries, right? Wrong. Where can you buy them? You can't. When do they mature? Don't know. What's the interest rate? Don't know. Are you getting the picture yet? These "Treasuries" the SS "Trust Fund" is invested in, aren't.

Heheh, thanks Rynar, that's one of the few times my patience has been commented on in a positive manner in a long time.

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"Dress cops up as soldiers, give them military equipment, train them in military tactics, tell them they’re fighting a ‘war,’ and the consequences are predictable." —Radley Balko

The Social Security site gives plenty of information on the interest rate and maturity dates of the securities issued to Social Security.

http://www.ssa.gov/oact/ProgData/newIssueRates.html
http://www.ssa.gov/oact/ProgData/specialissues.html
http://www.ssa.gov/oact/ProgData/intrateformula.html

Regardless, your claim is that the money in social security is a true investment because the federal government re-invests it in...itself. In expenditure ventures that almost without exception generates no revenues. Let's pretend for a moment that we aren't talking about the government, but a private fund:

Investor: "So, how is the money we invested in your fund used?"
Fund Manager: "Oh, don't worry; we invested it!"
Investor: "What is it invested in?"
Fund Manager: "We invested it in ourselves."
Investor: "You invested it in...you?"
Fund Manager: "Yep."
Investor: "Well, what do you do with it?"
Fund Manager: "We spend it."
Investor: "Spend it?"
Fund Manager: "We spend it."
Investor: "You generate a profit with it, I guess?"
Fund Manager: "Oh, heavens no. We just spend it. We haven't generated a profit in over a hundred years."
Investor: "But you're going to pay us returns?..."
Fund Manager: "That's right."
Investor: "Well, where do the returns come f--"
Fund Manager: "MAGIC."
Investor: "MAGIC?! But that's cr--"
Fund Manager: "WIZARDS."

_________________
Sail forth! steer for the deep waters only!
Reckless, O soul, exploring, I with thee, and thou with me;
For we are bound where mariner has not yet dared to go,
And we will risk the ship, ourselves and all.

See also: ENRON

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Madoff ran his business exactly like our government runs Social Security. It's how he stayed in business for 30 years.

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I only just now noticed this:


So it would be totally ethically fine for a failing business to borrow all of the funds in their employees' retirement accounts? And moreover, it's ethically fine for them to borrow all that money and then just refuse to pay it all back because they can't?

_________________
Sail forth! steer for the deep waters only!
Reckless, O soul, exploring, I with thee, and thou with me;
For we are bound where mariner has not yet dared to go,
And we will risk the ship, ourselves and all.

I find this viewpoint to be completely at odds with reality. There are corrupt people in government (many of them) but the entire institution is not somehow inherently corrupt.

I also do not buy that "lobbyists" own the "politicians" as many lobbyists are at odds with, and compete with, one antother, nor do I see any mechanism by which social security enriches either - especially given that it was originally create before WWII, and the same situation hardly obtains today.

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"Hysterical children shrieking about right-wing anything need to go sit in the corner and be quiet while the adults are talking."

All buying T-Bills does as an "investment," Xequecal, is make a lie out of the argument that SS isn't a welfare program because "it's self-funded."

Any "profit" that investment makes is subsidized by the general fund. So SS is not only taxing us with the SS tax, but it's also being contributed to by our standard taxes.

Hey, guys! I know how we can make SS solvent forever and ever and ever! We just have to issue special "preferred program" bonds at a 20% rate for SS to buy! Now, the money invested in SS will make huge returns, and be able to pay us off forever! We can even reduce the retirement age!

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"Aaaah! Emotions are weird!" - Amdee
"... Mirrorshades prevent the forces of normalcy from realizing that one is crazed and possibly dangerous. They are the symbol of the sun-staring visionary, the biker, the rocker, the policeman, and similar outlaws." - Bruce Sterling, preface to Mirrorshades

Lobbyists get paid lots of dollars from groups who have an interest in SS staying afloat and continuing to dupe Americans into believing their retirement is taken care of without any real investment or savings on the part of the individual. Say, AARP, and the politicians whose power increases exponentially when retirees are dependent on government.

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"Aaaah! Emotions are weird!" - Amdee
"... Mirrorshades prevent the forces of normalcy from realizing that one is crazed and possibly dangerous. They are the symbol of the sun-staring visionary, the biker, the rocker, the policeman, and similar outlaws." - Bruce Sterling, preface to Mirrorshades

Let me get this straight, what were left with is:

1) SS isn't a Ponzi Scheme because you're saying is that these "investments" that you insisted were Treasuries, aren't Treasuries; they're special instruments no one else can buy except SS, with proprietary interest rates and maturity dates subject to change by the issuing agency, not the market?
2) The "trust fund" is there because people who "invested" in the "trust fund" from the 40's didn't receive the money they invested and now that money is being used to pay off people who "invested" from the 60's?
3) It's not a Ponzi Scheme because it turned a profit by using actuarial tables to defraud investors, and if it were up to you, you'd refine and continue the practice, and refine it further, in order to make sure the "trust fund" turned a profit rather than the investors?

Would you buy into this "trust fund"? I know I wouldn't if I weren't being forced to by threat of incarceration and property seizure.

_________________
"Dress cops up as soldiers, give them military equipment, train them in military tactics, tell them they’re fighting a ‘war,’ and the consequences are predictable." —Radley Balko

While I wasn't aware that new money and old money were technical terms, that really isn't the problem. The issue I'm taking is solely with the attempt to apply the term "Ponzi scheme" to Social Security. It serves no purpose other than the application of prejudicial language either to vent one's ire, or to frame the discussion so that one's opponent appears to be supporting fraud rather than discussing the issue.

1) Social Security is explicitly legal; it is authorized by law. It is therefore by definition, not fraudulent, regardless of SEC definitions; if it were fraudulent the SEC would be investigating it.

I'm sure that the inevitable "but why is it ok for the government but not for everyone else?" The government makes the laws, under the Constitution. If you want to argue that Social Security is unConstitutional, ok, go for it, I might even agree, but I'm not going to agree that if its unConstitutional that somehow makes it fraudulent as well.

In other words, it may not be "ok" in the ethical sense or even Constitutional sense for the government to do it (and probably isn't) but that does not make it fraud.

2) SS does not, conceptually speaking, have to bear this similarity to a Ponzi scheme. First of all, the money is invested. T-bills are intrest-bearing instruments. This intereset needs to be paid back by either other tax revenues, or by borrowing, the latter of which leads us to where we are now, but if the overall financial structure of the government were well-managed, it is theoretically possible that there could be enough other tax income to cover the expense of paying those T-bills in the SS "trust fund".

The law could also be changed so that any surplus paid into the SS fund was invested in other areas; what other areas really does not matter.

In other words, the SS situation is due to poor reasoning in implementing it, and poor management of the overall government financial situation; including excessivley generous SS payouts.

3) Unlike a Ponzi scheme which necessarily needs to have an infinitely large pool of future "investors" in order to maintain its pyramid indefinitely, SS does not. It is in that situation right now because of the Baby Boom, and extended lifespans past original estimates, but as those boomers die off, the population being supported will not continue to expand in the same way a Ponzi scheme necessarily must. In an actual Ponzi scheme, those receiving payouts expand as a result of the need to bring them in to begin with to support the population that preceeded them. SS does not work like this. Its population is dictated by country demographics; despite the fact that participation is mandatory, it is not mandatory to have babies to eventually pay into it.

4) The government has an unlimited supply of money to pay SS debts with, unlike a Ponzi scheme, by simply monetizing it. Obviously it is a really bad idea to do this, but it can be done nonetheless, and no fraud would have been committed (despite the fact that doing so would be ethically questionable in other regards).

The need to do so is created by mismanagement of the country's finances in general, not by some sort of inherent flaw in the concept of Social Security.

5) I agree that, at the moment SS does share some characteristics with a Ponzi scheme, and represents all kinds of problems, ethically, financially, and Constitutionally, but the bottom line is that it I have seen no evidence whatsoever that it represents any sort of intentional fraud in the way a Ponzi or pyramid scheme does. I also do not believe that political discourse in this country is well served by this sort of rhetoric.

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"Hysterical children shrieking about right-wing anything need to go sit in the corner and be quiet while the adults are talking."

Perhaps I shouldn't have said "completely". There are, I'm sure, at least some ethical people still left in Washington. However, they are so outnumbered by the corrupt (certainly by at least a 2/3 majority, IMHO) that this is largely moot. The institution, as a whole, behaves in a corrupt fashion, even if there a handful of individual members who are not. Government isn't inherently corrupt, but ours has become corrupt.


In essence, lobbyists use money to buy politicians, and politicians use federal moneys to buy votes. Coming out and saying, "we can't afford to give everyone a chicken in every pot" is political suicide. Just look at what's happening in Greece with respect to the austerity measures. Do you really thing the American population is appreciably different (in that respect) from the Greek? It's all about pork, and has been for a long time. Certainly it was true in the WWII era (although, as an aside, I'm not sure what that has to do with the way SS is now?).

Raiding social security to fund pork is how both are enriched. Of course, it's not the only way that this happens. However, it is one of the most convenient ways because it "hides" the real cost of how they're **** as all over. It's another "secret tax" much like inflationary monetary policy of the fed (on that note, this would be a good time to remind people that the fed just flat stopped publishing M3 in 2006. Funny, that...) The social security system implies, to most people, that they're putting money into a bona fide investment vehicle -- that it isn't a tax, but rather a long-term investment. They have in their minds the idea that it doesn't really cost them as much as it appears to on paper because of the return they'll eventually get on the "investment". This is a far, far, more popular idea to sell than just raising the tax rate.

But the reality of the situation is that functionally, social security is nothing more than a straight-up tax by any other name. It is purely a matter of the government taking money from the people, spending it, and then having no means (and IMHO, no real intention) of ever paying them back. We have a name for that. In any other circumstance, we would call it a "tax", and a very regressive one, at that. But even that isn't per se the real issue. After all, the federal government does have the power tax. The problem is that it pretends that social security is really an investment. And as this thread evidences, a lot of people are willing to believe them. Indeed, you can't convince them otherwise. But even when social security does pay out benefits, no one (on average) actually makes any money off of it. This is due to the nature of how the system works and where the "returns" actually come from. You're either being paid back with your own money, or by the ever mounting debt of the federal government, which ultimately inflates away everything you own. You lose more than you gain.

And that is what makes it deceitful. It enriches politicians (along with all the other deceitful monetary policies) by allowing them to tax the population at rates far exceeding what the vast majority of people would imagine, without the electorate ever catching on to what they're doing. This is what keeps them in power. And frankly, as bad as the situation has become, it's probably the only thing that keeps them breathing. The vast majority of people are still caught up in this bizarre belief that where the federal government is concerned, there are no consequences. Well, not any really bad ones, anyway. Whatever happens, they have faith that we'll somehow "work it out" -- that we'll always be able to outwit the consequences of our own financial malfeasance. I coming to believe that this mass hallucination of Keynsianism-in-perpetuity is really just a symptom of that larger sickness. Yes, Virginia, if you **** up badly enough, bad things are going to happen to you. No exceptions. Welcome to the real world. If a majority of people ever woke up to that fact, I do believe that our politicians would have a great deal more to worry about than whether they're going to be re-elected.

_________________
Sail forth! steer for the deep waters only!
Reckless, O soul, exploring, I with thee, and thou with me;
For we are bound where mariner has not yet dared to go,
And we will risk the ship, ourselves and all.

SS isn't a ponzi scheme 'cause in a ponzi scheme the marks believe they're going to profit.

Show of hands who thinks they're going to get more out of social security than they would if they invested in ... basically anything else?

See?

Social Security is a way for the government to distribute wealth.

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In time, this too shall pass.

Yes, I get that. But also with a conventional Ponzi scheme, you don't have a gun held to your head forcing you to "invest".

_________________
Sail forth! steer for the deep waters only!
Reckless, O soul, exploring, I with thee, and thou with me;
For we are bound where mariner has not yet dared to go,
And we will risk the ship, ourselves and all.

One thing you have to remember when you argue Social Security with Taskiss, or any other financial and economic point, is that Taskiss is an old **** who's invested into the system. Whether or not he believes that he's had his money stolen from him for the past forty years he's been working is totally irrelevant at this juncture. He's spent that time believing wholeheartedly that he gets to spend the next ten to thirty years (depending on his lifespan) living off of your money. He thinks he's lived long enough now that he'll be dead before Social Security collapses. The only thing he really cares about now is whether he gets to live off of your money once he retires.

Taskiss demonstrates the sheer brilliance of Roosevelt's master stroke. People could understand that it's untenable and that a better system needs to be in place, and it won't matter. They will still vote to keep it in place because every year there's a new crop of old **** who've been robbed for forty years and want their money off the backs of their children. In order to eliminate Social Security, you have to start by systematically killing everyone over the age of fifty. Maybe forty.

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Buckle your pants or they might fall down.

Or you could give "current benefits to current seniors" and work your way down from there.

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I prefer to think of them as "Fighting evil in another dimension"

Doesn't work, because you can join AARP ten to fifteen years before you're eligible to retire. Somebody who's 55 years old wants Social Security to be in place just as badly as someone who's 75, and won't be receiving benefits for twelve years.

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Buckle your pants or they might fall down.

1. Yes, they are Treasuries. They're issued by the Treasury, what else are they? I was honestly not aware that the general public could not buy these particular securities, but that point is irrelevant. Also the special issue interest rates are determined by the market.



The interest rate is set based on market conditions. I realize they're technically not traded on an exchange with the rate updated in real time based on demand, but this isn't less based on "market conditions" than when a bank sets its mortgage rate based on some other data about the market.

2. Pretty much, yes. You're the one who insisted on going by the exactly by-the-book definition of a Ponzi scheme, not me. And since SS isn't using new money to pay off old, it's not a Ponzi scheme. You see SS as a Ponzi scheme because of your inherent belief that the US dollar is fundamentally worthless and thus Treasury securities are also as worthless as a handwritten IOU from Madoff. This is how you can claim that there "is no trust fund" despite the >$2 trillion in securities that are there.

3. You're now claiming that the retirement age of SS was deliberately set to knowingly defraud the population? Why can't I get away with these kinds of fiat declarations? And yes, I'd refine SS and continue it, because it's vastly preferable to the alternative, which is people not investing ANYTHING for retirement, or investing it in stupidly risky investments and losing it all, and then demanding (and/or voting themselves) a handout at age 65. The only money "lost" by SS is the difference between the interest rate earned by the SS Treasuries and the interest rate you could have earned had you invested that money yourself. The federal government's borrowing spree is a completely separate problem that does not reflect badly on SS itself. SS would have exactly the same issue it does now even if the government had never borrowed a single dollar from it ever and had instead borrowed from other sources, you still end up with the issue that your SS payout is worthless if the government has to monetize its debt.

Technical, or not, I used terms understood in the industry, and not understood by you. That was my mistake.


It serves the purpose of defining what SS is based on: The practice of paying old investors with money from new investors.

This is the argument I was waiting for. It is the perfect argument of Statists. The State says it is (or isn't) so, therefore it is (or isn't). There is no rebuttal against such an argument, and if one desires to go continue down this road by the use this argument (especially in light of your own statements on the matter), it would be pointless to continue.



It isn't a Ponzi Scheme because it doesn't have to be, or it wasn't intended to be a Ponzi Scheme? Ponzi bought investment instruments, when he couldn't fulfill his obligations, he turned to the methodology now known as a Ponzi Scheme.



It's not a Ponzi Scheme, because it doesn't need an infinite pool of new investors? Why is it mandated that we pay in to SS, if it doesn't need the new investors? What would happen if an inordinate number of "investors" decided to pull their investment out (as is the downfall of most Ponzi Schemes) of SS?



It's not a Ponzi scheme because the Gov't has the power, over the currency issued by the Gov't, to make the "investments" worthless? That makes me feel comfortable with my "investment" into SS. The monetization portion is only there because the Gov't has taken the actual money paid in by "investors", and replaced it with a non-negotiable, proprietary instrument, the details of which are defined by the Gov't. Yet, it still leaves the fact that a Ponzi Scheme uses new money to pay off old money, and so does SS.


The only characteristic it shares with a Ponzi Scheme is that it uses new investors money to pay off old investors. Coincidentally, that is the only express characteristic of a Ponzi Scheme.


Except for the fact that a Ponzi Scheme is fraudulent because it's a Ponzi Scheme. Paying off old investors with money from new investors is fraudulent. SS uses money from new investors to pay off old investors. SS isn't using this method of self perpetuation by accident, it's using it by design.

I do not believe that the citizens of this country are well served by being forced to pay into a Ponzi Scheme.

_________________
"Dress cops up as soldiers, give them military equipment, train them in military tactics, tell them they’re fighting a ‘war,’ and the consequences are predictable." —Radley Balko

The problem I have with this is basically where you claim that it "enriches politicians". You seem to skip from "enriching" them to "keeping them in power", but regardless, I do not see any politicians really getting rich from any of this. Congressional salaries are not that high; money from political contributions is not wealth they actually own, and I while most politicians would prefer to stay "in office" (they are not "in power" at all; no one of them can ever simply have their own way) most of them are already wealthy, or at the very least not in any personal financial danger.

As such, personal enrichment is not really a goal of many politicians. Yes, some are corrupt and willing to take money under the table, but that's the exception because most of them realize that public disgrace is the probable end result. That's why sex scandals are more common; the sex drive is a lot harder to control.

Most politicians want to stay in office, but not because (or at least not primarily because) they just love power want more power, and it's just all power, all the time, at all costs, platitudes about "power corrupts" notwithstanding. For the most part, they are there because they think they can "make a difference". The view that they just want power for power's sake is simplistic, and in many ways counterproductive because it inhibits more detached analysis of the situation in favor of simply congratualting onesself for not being like the Pharisee politician.

No, the real danger lies in the fact that most of them think they can make life better, and that is the real problem - people who have become corrupted by their own benevolence and condescending attitude towards the average person. This is why there's so much talk about them being "out of touch" because that is the true nature of the corruption - a government made up of people who all think they know what's best for everyone, and worse, cannot agree on what that is and so we get a hybrid solution that costs far more than the "what's best" of any one idea would have been and the only advantage is that this sheer competition of ideas keeps any one person or group from simply laying down the law.

As for your comparison to Greece, yes, the American people are inherently different simply by virtue of us being a far larger and far less homogenous country. In point of fact, any time anyone says what "the American people" want they are already being deceptive because "the American people" as a whole can agree on almost nothing. There are segments of our society that probably sympathize with the Greek workers who have become accustomed to really not doing any work or paying any taxes, and we have others that despise the sort of society Greeks have gotten away with for decades, and would gladly dispense with entitlements.

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"Hysterical children shrieking about right-wing anything need to go sit in the corner and be quiet while the adults are talking."

There's a really simple litmus test for Ponzi schemes: if an investment vehicle is a real vehicle that pays returns out of real profit, then if you stop it from bringing in new investments, business continues more or less as usual. The fund managers will continue to make a profit. People caching out their investments will continue to get paid. If, on the other hand, the fund is a Ponzi scheme, it will have to freeze its returns.

Since Ponzi schemes don't actually generate anything, (and in most cases have no money after the initial investments are raided), they have to pay out returns from the new investments coming in. But then when it comes time to pay out returns for those investors, their money has already been used either to pay out returns to old investors or to enrich the people running the scam. So in order to pay out returns for them you have to bring in yet more investments -- either in the form of new investors or in new investments by old investors.

So the total amount of the Ponzi scheme's liabilities -- i.e. debt -- has to constantly increase. You might say it's sort of like a ceiling. A debt ceiling, if you will. So this "debt ceiling" has to be constantly raised in order to continue issuing returns. And if, for any reason, this ceiling can't be raised, the fund would have to threaten to stop paying out returns to the old investors who are currently wanting to cash out.

But, you know, nothing like that would ever happen with social security!

_________________
Sail forth! steer for the deep waters only!
Reckless, O soul, exploring, I with thee, and thou with me;
For we are bound where mariner has not yet dared to go,
And we will risk the ship, ourselves and all.

Thats what I meant by technical terms.



Except that this is not the entirity of a Ponzi scheme, and SS is not based entirely on such a concept. It is supposed to have investment income, and maintain a surplus to cover times when that is insufficient. Again, a Ponzi scheme necessarily requires ever-expanding population base, SS is designed (in theory) to run a surplus when it has a high pay-in and a use that money to cover times when it must pay out more (the degree of realism of this plan notwithstanding)


First of all, so what if it's an argument of "statists"? It's true. Fraud is defined by law, and that's what governments do - make laws. I see you just ignored that I pointed out that the law might be unConstitutional just so you could get mention of "Statism" in there, because we all know getting an "-ism" out is a major victory in internet discussion, and I pointed out that it might be ethically questionable, but you didn't bother to address that either.



I'm well aware of his history, but either way, it's not a Ponzi scheme; it does not have the same underlying concept. It is, in fact, physically impossible for it to be one because it's "clientele" is determined by the size and longevity of the population, not by investment seeking.



This has nothing to do with it. It's explicitly set up to be a steady-state over time cash-in, cash-out system. People are not being told (regardless of what they tell themselves) that they will come out ahead; if they die before drawing any payments, they lose it all. SS does not require an infinitely large pool of investors; it simply requires a fairly steady birthrate and steady life expectancy. The eventual investors may be indefinite, but a Ponzi scheme requires investors come in at a rate dictated by the promised return. SS does not; surpluses can (in theory) run at times to cover times when there is not one and taxes can be used to cover deficiencies as well.


Whether you're comfortable or whether its a good idea for the government to do so has nothing to do with whether its a Ponzi scheme.



You are relying on one little bit of what makes a Ponzi scheme and its resemblance to social security to call them the same thing. It is irrelevant why the monetezation option exists, or how it works. Your claim "well, they both use new money" makes the definition excessivly broad. It is as if you were to say "ducks have wings, and X-wing fighters have wings, therefore ducks are X-wing fighters."



This is false. It is NOT the only express characteristic of a Ponzi scheme. A Ponzi scheme promises profits, and does so fraudulently. If the SEC definition you were using does not take that into account (and it appeared that it did) then it is excessively broad, and of questionable Constitutionality for enforcement purposes itself, since it allows simple poor decisions to be characterized as a form of fraud.



Circular argument.



You've shown no good reason to think that they are. You have excellent arguments against SS on the merits of the actual system, so why it's so all-fired important to get an inaccurate label applied to it is beyond me. I can only attribute it to the overall Board competition to see who can express outrage at the government in the loudest and most condemnatory terms.

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"Hysterical children shrieking about right-wing anything need to go sit in the corner and be quiet while the adults are talking."

If the debt ceiling were purely a result of Social Security, and if Social Security were supposed to generate any sort of "return", you might be on better ground with this.

Again, the bottom line reason that it isn't a Ponzi scheme is that the money you pay into SS isn't yours. The courts have ruled on this. If you were to die, your estate would be legally entitled to the money you had invested in a Ponzi scheme; it is not entitled to what you paid into social security.

It is taxation for the purpose of social engineering and wealth redistribution. This basic fact, that it is a government social program, utterly precludes it being a Ponzi scheme, unless it were to subject itself to the same rules as an actual "investment" (which SS is not, the use of that word to make it sound better to the population notwithstanding)

The mere fact that it's taxation for wealth redistribution ought to be problem enough without having to jump through hoops to make it appear to be the same as some con man making himself a fat profit.

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"Hysterical children shrieking about right-wing anything need to go sit in the corner and be quiet while the adults are talking."