{"id":99,"date":"2009-11-02T06:45:06","date_gmt":"2009-11-02T12:45:06","guid":{"rendered":"http:\/\/www.zullnero.com\/blah\/?p=99"},"modified":"2009-11-02T06:45:06","modified_gmt":"2009-11-02T12:45:06","slug":"why-social-security-is-nothing-like-a-ponzi-scam","status":"publish","type":"post","link":"https:\/\/www.zullnero.com\/blah\/archives\/99","title":{"rendered":"Why Social Security is nothing like a ponzi scam"},"content":{"rendered":"

So the Cato Institute guys are rattling the Social Security cage again in order to gin up their Libertarian base like they do every year<\/a>. As if a total<\/a> repudiation<\/a> of their philosophy worldwide<\/a> wasn’t enough for them. <\/p>\n

Here’s why Social Security isn’t a Ponzi scam, and why neo-conservatives should really read up on Ponzi scams because apparently they don’t understand the accepted outcome of a Ponzi scam (and what makes it a scam): Ponzi scams generate less revenue than they take in. The concept here is that a guy or organization gets a lot of people to pay into a pot, and when those people go back to get their investment back, they get back less than they paid in.<\/p>\n

Barring a mass die-off or disengagement from society of Americans aged 18-65, Social Security will always generate at the very least a 2% growth in that investment, and during economic booms, will generate more than that. Granted, it’s a very, very conservative, low risk investment, but that’s kind of how it’s supposed to be. It’s money that is expected to be there when you turn 65, and barring a complete deconstruction of the US government, that money will be there. Your employer can do horrible things like raid your pension plan<\/a>, your investment broker could go belly up, your mutual fund could tank in a down economy, but that social security check will be there. Why? Very easy…there are more people aged 18-65 than there are 65 and older, and even if you’re under 65 and pulling Social Security, you’re still in a minority. Considering that it’s a government agency, the government isn’t supposed to raid those funds (though that didn’t stop Reagan<\/a> from dipping into that cookie jar). The money that goes in is essentially invested and paid out to the previous generation, and so on…meaning that at the absolute worst, the same amount of money comes out as goes in (and even then that’s saying there’d have to be some sort of serious economic or otherwise calamity). <\/p>\n

So, lets repeat…Ponzi scam: More money goes in than comes out. Social Security: Equal or more money goes out than goes in. They may seem superficially similar, but what you measure is the results, and the results are completely different. <\/p>\n

This is a common trick with a lot of things the Cato Institute does. They love to try and back up their libertarian philosophy by making their points in a particular manner, but frequently leave out excruciatingly important details. It’s a trick where they go from A to C, and they hope that their listeners just didn’t notice that they skipped step B.<\/p>\n

Iceland can’t support McDonalds anymore. Why is that? Because a few Libertarians over there, enamored with Milton Friedman, went berserk and privatized all the banks (and everything else they could privatize)…and after having a momentary economic boom not unlike the one in the US, they deflated and fell completely apart. They crashed so hard, that the people there turned on the Conservative\/Libertarian party completely and elected the Democratic Socialist Party to come in and try to clean up the mess. So the bottom line is, the few Libertarians still holding onto that goofball philosophy of theirs because they personally identify with it are looking for anything they can find that they can use to keep deluding themselves that “deregulation and privatization is a great way to run an economy”. Of course, they’re suckers. They are not unlike people who hand thieves the keys to their front door and car, and “hope” that those thieves will use “free choice” to choose not to rob them.<\/p>\n","protected":false},"excerpt":{"rendered":"

So the Cato Institute guys are rattling the Social Security cage again in order to gin up their Libertarian base like they do every year. As if a total repudiation of their philosophy worldwide wasn’t enough for them. Here’s why Social Security isn’t a Ponzi scam, and why neo-conservatives should really read up on Ponzi […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-99","post","type-post","status-publish","format-standard","hentry","category-all"],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/posts\/99","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/comments?post=99"}],"version-history":[{"count":1,"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/posts\/99\/revisions"}],"predecessor-version":[{"id":100,"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/posts\/99\/revisions\/100"}],"wp:attachment":[{"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/media?parent=99"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/categories?post=99"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.zullnero.com\/blah\/wp-json\/wp\/v2\/tags?post=99"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}