Like RWN Has Been Telling You, Social Security Is A Ponzi Scheme

As Michael Kinsley once famously said, “A gaffe is when a politician tells the truth.” Last night at the debate, Rick Perry told the truth about Social Security and although it’s not a gaffe in the conventional sense, you can expect to see both Republicans and Democrats who know he’s 100% right trying to spin desperately to try to hide the truth: Yes, Social Security is an unsustainable Ponzi scheme.

Perry didn’t call for an end to Social Security, nor did he say we should cut benefits for people already on the program, but he did point out that Social Security is not going to look the same way for younger Americans that it does today. He also noted that we need to make some changes to the program for people who have not reached retirement age if we want to make the program sustainable.

The fact that is even controversial tells you how little the mainstream media in this country does to educate the public about the problems we face.

Here’s the reality, step by step.

The ultimate issue is that over the years, the cost of Social Security and Medicare has escalated dramatically and the government, being the government, has failed to demand that people pay as much into the programs as they’re going to take out.

That worked out okay for awhile because of the population bubble created by the birth of the baby boomers. There were so many people paying into the system that it didn’t matter that everyone wasn’t paying his own way.

However, the baby boomers are now starting to retire and there’s no glut of workers to keep the Ponzi scheme going – and that’s what it is. Individuals who set up financial schemes that are constructed the same way Social Security and Medicare are get arrested for fraud because ultimately, somebody always gets left holding the bag.

So, we are left with a fundamental problem: We have 100 TRILLION DOLLARS in promised benefits that we have no way to pay for – and that’s setting aside the fact that we’ve already spent all the money we’ve collected and created bonds that have to be redeemed out of the general treasury, to give people the false impression that their money hasn’t yet been spent.

So, on the one hand, we have people who have been promised things all their life by the government. They’ve paid money in exchange for those promises; so they REALLY feel entitled to get every dime they’re owed. But, the government doesn’t have the money to pay them – and because of the size of the programs, the only way to get the money will be to either DRAMATICALLY escalate taxes on EVERYONE, not just the rich, or to DRAMATICALLY cut back what the programs are paying out over the next few decades. That’s not what ANYBODY wants to hear, but it’s what’s going to happen because eventually – and eventually is probably a decade or two away at best – our choices will become very limited. Either we take one of those two options or jackknife the economy for decades by defaulting or worse yet, inflating the currency into the stratosphere.

If even that’s not enough to convince you, take a look at this video, too.

Saying Social Security is a Ponzi scheme, that all the money that has been collected for the program has already been spent, and that we will either have to dramatically cut benefits or dramatically escalate taxes to continue the program are just plain statements of the unambiguous facts that are in front of us.

Calling for the status quo to continue will put the entire program at risk for purely political purposes and that’s simply unconscionable.

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