Social Security: Ponzi Scheme or Sacred Cow?

The past two days Americans were treated with a Republican debate and a speech from our President.  Both were snoozers as they said nothing new in reality, but one moment did jump out as notable.  An exchange occurred between Mitt Romney and Rick Perry over "provocative language" regarding Social Security.

Why is this notable?  Social Security was once labeled as a sacred cow by Milton Friedman because if any politician dared to touch it they would be burnt toast.  Barry Goldwater serves as a shining example of how the ruthless American public will skewer any politician that goes after their "entitlements".  

Seems like Rick Perry did not get the message, he not only called SS a Ponzi Scheme, but doubled down in the debate and reaffirmed his position when challenged by Romney.  Now, Romney being quite shrewd on what to say in order to garner maximum support spoke of saving SS even citing that it is a Republican tradition to do so.  This of course brings us to a much more critical point.  

Despite what you believe is SS's role in our lives, can we at least admit that it is indeed a Ponzi Scheme?  Or in even simpler terms does SS require a larger and larger pool of payers to support the "investors"?  The answer is obvious.  From the days of FDR where 14 people paid for one recipient we have come a very long way to just barely 3 people per one recipient.  As the baby boomers retire in droves this ratio will flip and the entire system will be exposed for the fraud that it is.

Yet despite all that prominent politicians and pundits refuse to even discuss the fundamental flaw with SS.  That it is neither an insurance policy nor is it a retirement investment plan - both things that the SS Administration once claimed.  

Below is an absolutely perfect example of how the media continues to perpetrate the myth on behalf of the senior citizens in this country while the lone wolves get skewered trying to point out the obvious. 

Rick Santelli takes on Thomas Friedman (who writes for the New York times and pretends to offer solutions to our most vexing problems) and the crew of CNBC.  This is what happens to people who threaten SS - Rick Perry, take note.



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