Perry no longer thinks SS is a Ponzi scheme.

[JoeTheJuggler]

You may be wishful thinking that they are more nuanced, but the fact is that similarities are what's important and again the basic structure of both are the same.

Again, the only thing Social Security has in common with a Ponzi Scheme is what virtually all taxpayer-financed spending programs have in common with a Ponzi Scheme.

The critical characteristics of a Ponzi Scheme that make the term rhetorically "hot" are deception, fraud and illegality, and are not characteristics of Social Security.

I think the problem here is that Perry wants everyone to think of Social Security as a forced IRA, and then he can argue against that straw-version of Social Security. The trouble is, Social Security is not and never was a forced IRA. The very first month Social Security taxes were collected, benefits were paid out. [ETA: And there are beneficiaries, especially on SSD, who aren't expected to contribute what they will receive.]

It is a safety net program for retirees and the disabled supported by taxes. To consider it an investment is an abuse of language.

ETA: Neally, if someone said income taxes are theft (and they have), would you consider that to be legitimate rhetoric? After all, there are similarities. Money is taken from people involuntarily. So clearly just having one characteristic in common doesn't make it a legitimate comparison. It's just loaded language. If Perry wanted to point out that the Social Security trust fund will be depleted some point between 25 and 75 years from now if we do nothing to accommodate changing demographics in our population, he could have said it that way. Then the obvious conclusion is to do something to accommodate the changing demographics. If it's a Ponzi Scheme the obvious conclusion is to put an end to it as soon as is practically possible.

 

[mhaze]

Again, the only thing Social Security has in common with a Ponzi Scheme is what virtually all taxpayer-financed spending programs have in common with a Ponzi Scheme. ...... It's just loaded language.

If Perry wanted to point out that the Social Security trust fund will be depleted some point between 25 and 75 years from now if we do nothing to accommodate changing demographics in our population, he could have said it that way. Then the obvious conclusion is to do something to accommodate the changing demographics. If it's a Ponzi Scheme the obvious conclusion is to put an end to it as soon as is practically possible.

Incidentally, Perry's not going to play your little game of endlessly arguing over nuances of word definitions. And in fact, he's already said what you suggest he "should have said" (Debate #3, Tea Party Debate):

BLITZER: Governor Perry, speaking of Social Security, you've said in the past it's a Ponzi scheme, an absolute failure, unconstitutional, but today you wrote an article in USA Today saying it must be saved and reformed, very different tone. Why?

PERRY: Well, first off, the people who are on Social Security today need to understand something. Slam-dunk guaranteed, that program is going to be there in place for those. Those individuals that are moving towards being on Social Security, that program's going to be there for them when they arrive there.

But the idea that we have not had the courage to stand up and look Americans in the face, young mid-career professionals or kids that are my children's age and look them in the eye and said, listen, this is a broken system. It has been called a ponzi scheme by many people long before me. But no one's had the courage to stand up and say, here is how we're going to reform it.

We're going to transform it for those in those mid-career ages, but we're going to fix it so that our young Americans that are going out into the workforce today will know without a doubt that there were some people who came along that didn't lie to them, that didn't try to go around the edges and told them the truth.​

 

[RandFan]

Incidentally, Perry's not going to play your little game of endlessly arguing over nuances of word definitions.

Perry instead will obfuscate.

It has been called a ponzi scheme by many people long before me. But no one's had the courage to stand up and say, here is how we're going to reform it.

Okay, so let's have that "truth", is it or is it not a Ponzi scheme in your estimation?

Oh, I'm 50, I've paid into the system all my life, am I screwed?

 

[Skepticemea]

My giddy aunt, some people will defend a position even if it's not their own, but to defend a position that's not only someone else's, but one that constantly shifts?

Or perhaps I've misunderestimated Perry.

 

[RandFan]

My giddy aunt, some people will defend a position even if it's not their own, but to defend a position that's not only someone else's, but one that constantly shifts?

Or perhaps I've misunderestimated Perry.

Pilot, cheerleader, strategery my friend.

 

[Neally]

People rarely die?

No, Ponzi schemes rarely pay into the estates of dead participants.

Truth is if the money hadn't been raided for other stuff it would be solvent for some time.

The fact that SS has survived longer than most other Ponzi schemes doesn't mean it's not structured the same way. Lower payouts and a massive base of legally required contributors certainly help its longevity.

FWIW: Krugman is a Nobel prize winning economist. That doesn't make him right but it gives him a bit of credibility.

From Kurgman's article: "The program won’t have to turn to Congress for help or cut benefits until or unless the trust fund is exhausted, which the program’s actuaries don’t expect to happen until 2037"

I guess that puts him in the "kick the can down the road" camp and that we don't need to bother to look at fixing it until it's actually exhausted. He'd fit right in if he lived in Greece.

But it doesn't have to be unsustainable, that's the difference. As long as birth rates, death rates, employment figures, and some other demographics remain constant, a Social Security formula can be created that will last forever without any modifications. The problem is that these things change over time, so the formula needs to be adjusted every few years.

Right, but on the current path it will be exhausted by 2037. It now relies on payouts via the same mechanism as a Ponzi scheme.

Social Security's obligations are reduced when people die, as everyone does eventually. The only way Ponzi could get obligations off his books was by paying them off with other people's money. This is a major and fundamental difference that the "Social Security is a Ponzi scheme" crowd always ignores.

It doesn't really matter if the obligation is "on the books" or "off the books" if the system is exhausted and it collapses, does it?

Again, the only thing Social Security has in common with a Ponzi Scheme is what virtually all taxpayer-financed spending programs have in common with a Ponzi Scheme.

Crude diversion and bad analogy. A taxpayer funded program to build a bridge can hardly be compared to the economics of funding and sustaining SS.

The critical characteristics of a Ponzi Scheme that make the term rhetorically "hot" are deception, fraud and illegality, and are not characteristics of Social Security.

Falling back on the weak argument that "since SS is not illegal, it's not a Ponzi" again? Conveniently ignoring the structurally identical funding and payout methods of both?

ETA: Neally, if someone said income taxes are theft (and they have), would you consider that to be legitimate rhetoric? After all, there are similarities. Money is taken from people involuntarily.

If they consider the government illegitimate, yes.

So clearly just having one characteristic in common doesn't make it a legitimate comparison.

In post 72 I gave the main defining characteristics of a Ponzi scheme. One minor similarity may not make a valid comparison, but when the main funding structure is the same, the comparison holds, despite your hand waving away of the other differences.

It's just loaded language

Sure it's loaded language, but a valid comparison nevertheless.

If Perry wanted to point out that the Social Security trust fund will be depleted some point between 25 and 75 years from now if we do nothing to accommodate changing demographics in our population, he could have said it that way. Then the obvious conclusion is to do something to accommodate the changing demographics. If it's a Ponzi Scheme the obvious conclusion is to put an end to it as soon as is practically possible.

More like, put an end to the structure that makes it a ponzi scheme. Something that both parties are afraid to do out of fear that their attempts will be smeared to be construed as "they want to kill SS". You know, kind of what's happening to Perry now?

 

[mhaze]

....Sure it's loaded language, but a valid comparison nevertheless.

More like, put an end to the structure that makes it a ponzi scheme. Something that both parties are afraid to do out of fear that their attempts will be smeared to be construed as "they want to kill SS". You know, kind of what's happening to Perry now?

I wonder, if the people on this forum who argue sort-of that "SS is not a Ponzi scheme" would be opposed to "putting an end to the structure that makes it a ponzi scheme (or similar to a ponzi scheme)".

Is there some common ground there?

 

[RandFan]

No, Ponzi schemes rarely pay into the estates of dead participants.

THAT'S THE POINT. In the end they DON'T PAY!

From Kurgman's article: "The program won’t have to turn to Congress for help or cut benefits until or unless the trust fund is exhausted, which the program’s actuaries don’t expect to happen until 2037"

Yes. I note you edited out where he said "if at all" (paraphrased).

Right, but on the current path it will be exhausted by 2037. It now relies on payouts via the same mechanism as a Ponzi scheme.

All govt programs rely on the same scheme.

It doesn't really matter if the obligation is "on the books" or "off the books" if the system is exhausted and it collapses, does it?

There is no evidence that it will colapse. Or maybe you know something Krugman doesn't?

More like, put an end to the structure that makes it a ponzi scheme.

You mean put an end to govt. You haven't made your case. Assertions simply don't cut it. Krugman is an intellectually honest economist who disagrees much with the Democrats. He calls for spending cuts. If SS were an obvious Ponzi scheme as you suggest he would step up to the plate. Still, an appeal to authority, even one who is an expert in his field doesn't make a proposition true. If you had the goods I'd take that over Krugman. But you don't.

 

[Neally]

There is no evidence that it will colapse. Or maybe you know something Krugman doesn't?

If changes aren't made, the SS trustees report that it will be broke by 2036-2037.

You mean put an end to govt.

Um, no I never said that.

You haven't made your case. Assertions simply don't cut it.

If you want to challenge the SS trustees that say it will be broke by 2036-2037, go ahead and make your case. I'll take their word and expertise until you can demonstrate they are wrong.

Krugman is an intellectually honest economist who disagrees much with the Democrats. He calls for spending cuts. If SS were an obvious Ponzi scheme as you suggest he would step up to the plate. Still, an appeal to authority, even one who is an expert in his field doesn't make a proposition true. If you had the goods I'd take that over Krugman. But you don't.

All Krugman has shown is that he is willing to kick the can down the road like so many others, in the hopes that either the demographics will somehow fix themselves or that someone else comes up with a fix.

The SS trustees urge that action be taken soon:

Projected long-run program costs for both Medicare and Social Security are not sustainable under currently scheduled financing, and will require legislative corrections if disruptive consequences for beneficiaries and taxpayers are to be avoided.

The financial challenges facing Social Security and Medicare should be addressed soon. If action is taken sooner rather than later, more options and more time will be available to phase in changes so that those affected can adequately prepare.

- http://www.ssa.gov/OACT/TRSUM/index.html

 

[mhaze]

.....All Krugman has shown is that he is willing to kick the can down the road like so many others, in the hopes that either the demographics will somehow fix themselves or that someone else comes up with a fix.

The SS trustees urge that action be taken soon:
- http://www.ssa.gov/OACT/TRSUM/index.html

The SS trustees do not take into account the effect of the overall debt and money supply inflation on the value of the dollar, but consider the needs of "their department" in isolation. But it's not in isolation.

Like Rick Perry said, we need to have an "honest discussion" about SS.

 

[Lurker]

But yeah, the younger people would seem to have to be forced to continue paying since there is no "lockbox", current receipts fund current recipients.

Let me get this straight. Conservatives complain about there not being a "lockbox" yet they also complain about the low rate of return on SS investments and say they could do better in the market.

Am I the only one seeing a total disconnect there? If it were truly in a "lockbox" like conservatives request, wouldn't they be getting 0% return on their investment and only end up with the money they put in?

 

[johnny karate]

Nonsense. You simply do not have any "evidence" for your position. You have hearsay. You know nothing except what you've been told to think and believe.

So multiple news outlets are lying? You sound like a conspiracy theorist.

It couldn't get any simpler than this. You made a claim, and you backed it up with other people making the claim. The claim is verifiable physically in the real world. I've got the source material, and it is false. I have provided the actual paragraphs that Perry wrote. You were asked to give the page numbers of the supposed quotes, and you cannot do it.

I can - and have - provided evidence that Perry said what he said. Everyone can see that. You've provided nothing but baseless denials and bare assertions.

Can you provide evidence that multiple news outlets are lying or mistaken? Of course you can't.

Tough, dude. Reality's a bitch sometimes. The position of Perry on Social Security is as laid out in 84 and 89. You claimed it was changing with recent statements by Perry. The facts are it is not changing.

My claim has been sourced, and those sources are unchallenged. That's reality.

Go by a book store, get the book and refute me.

Once you've been refuted - which you have - you don't get to then set up arbitrary hurdles for the person who refuted you to leap in order to prove you weren't actually refuted in the first place.

Here, I'll do it again:

Ricky Perry from his book "Fed Up!" on dismantling Social Security:

He suggested the program’s creation violated the Constitution. The program was put in place, “at the expense of respect for the Constitution and limited government,” he wrote, comparing the program to a “bad disease” that has continued to spread. Instead of “a retirement system that is no longer set up like an illegal Ponzi scheme,” he wrote, he would prefer a system that “will allow individuals to own and control their own retirement.”

http://blogs.wsj.com/washwire/2011/08/18/perry-is-less-fed-up-over-social-security/

The Perry quote in bold is confirmed by many other news outlets here.

If you deny the veracity of what these multiple news outlets are reporting, that is a positive claim which has to be substantiated.

Asking us to take your word for it doesn't quite cut it.

 

[RandFan]

If changes aren't made, the SS trustees report that it will be broke by 2036-2037.

According to current projections. Those are not in concrete and the general fund would then be used.

Um, no I never said that.

Follows from your logic. Everything govt does is a Ponzi scheme.

All Krugman has shown is that he is willing to kick the can down the road like so many others, in the hopes that either the demographics will somehow fix themselves or that someone else comes up with a fix.

No. He has shown that the dire warnings are unfounded.

The SS trustees urge that action be taken soon:
- http://www.ssa.gov/OACT/TRSUM/index.html

They have a legitimate concern for the fund. It doesn't mean it will bankrupt govt as Krugman notes.

 

[mhaze]

....
Asking us to take your word for it doesn't quite cut it.

I'm not. We are talking about a book that's in the bookstores. Everything I've said can be verified, and if you are too lazy to go do it, then STFU.

Or use your GoogleFU to provide the page numbers.

 

[johnny karate]

Delete post

 

[lomiller]

If you want to challenge the SS trustees that say it will be broke by 2036-2037

Just out of curiosity, what exactly do you think this means? I.E. what specifically would change when the Social Security Trust fund is depleted?

 

[bikerdruid]

I'm not. We are talking about a book that's in the bookstores. Everything I've said can be verified, and if you are too lazy to go do it, then STFU.

Or use your GoogleFU to provide the page numbers.

temper, temper.
yours is the burden of proof.

 

[mhaze]

Let me get this straight. Conservatives complain about there not being a "lockbox" yet they also complain about the low rate of return on SS investments and say they could do better in the market.

Am I the only one seeing a total disconnect there? If it were truly in a "lockbox" like conservatives request, wouldn't they be getting 0% return on their investment and only end up with the money they put in?

Not sure what you are getting at, but we have already established that the SS securities are paid 4.6% for "loaning their money to the US government". I recall that the net return for an individual averaged 2%, but that would seem to vary with many circumstances. Full payments are provided for anyone who works at least 40 quarters or 10 years. Someone who works 40 years and contributes 4x as much does not get a dime more.

 

[JoeTheJuggler]

Incidentally, Perry's not going to play your little game of endlessly arguing over nuances of word definitions.

You mean he will continue to use words without regard for their conventional meanings?

Come on, haze, you know the reason he said "Ponzi Scheme" rather than "a tax that works like most taxes do in not paying back benefits strictly to those who pay in and strictly in equal amounts" is because "Ponzi Scheme" implies deception, fraud and crime.

 

[sarge]

Yes, I've already noted that as long as dollars can be printed, dollars can be handed out.

You are inventing wrong answers to questions not actually asked.

Solving the Social Security "problem" does not depend on inflating the dollar.

But if the corresponding increases in the money supply and the resulting inflation lowers the value of said dollars, then this is nothing more than juggling money from year n+3 to year n. That of course, reaches a point of limiting returns and limiting benefits.

There is no need to increase the money supply. There is a need to increase the revenue. These two things are not only not synonymous, they are not similar.

Mincing words and trying to narrow the scope of the discussion won't get around these general issues.

Stop making stuff up. If you struggle to keep arguments with several different interlocuters seperate, stick to one argument at a time.

If you want to claim that when spending is reduced by 40%, social security won't be reduced at all, go ahead. Makes no difference to me. Just seems rather unlikely that will be the case.

Either demonstrate that it is necessary to cut Social Security benefits when general spending is cut, or admit that you are simply guessing.

Social Security has its own source of funds. Social Security can remain solvent independent of general budget tightening. It can happen by increasing the revenue, decreasing the payout, or both. This is fact, and can not be changed no matter how often or forcefully you state your opinion to the contrary.

And there is no contractual obligation to pay any SS, only a promise that changes with the winds. Frankly, your attitude illustrates well the problem which Perry spoke of about SS

I have no "attitude" about Social Security either way - perhaps that is what allows me to seperate the facts from the fictions about social security. Perhaps if yu had not painted yourself into a corner defending Perry's statements, you might have been able to do as he has done - put the paint brush down and walk quietly out of the room.

:

"Now if you say Social Security is a failure, as I have just done, you will inherit the wind of political scorn. Seniors might think you want to cut the benefits they have paid for. Politicians will want to take advantage, stirring up fear about benefits that will be lost if you elect another "heartless Republican." I get it. ....

But by remaining quiet, politicians are really saying they think the American people won't understand it if we share the grim details of our financial future....

Is that how we should respect our fellow citizens? By underestimating their intelligence, their desire to retire with greater stability, or their commitment to the next generation? ...."

Perry is mistaken. Social Security is not a failure. It still serves exactly the purpose for which it was intended, and will continue to do so for decades to come. With adjustments, it will always do so. This is simple, demonstrable fact.