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Title: Rick Perry is Right: Social Security Really is a Ponzi Scheme
Source:
Dissenting Opinions
URL Source: http://jwpegler.blogspot.com/2011/0 ... -is-right-social-security.html
Published: Sep 10, 2011
Author: Eric Blankenburg
Post Date: 2011-09-10 21:05:00 by jwpegler
Keywords: None
Views: 114394
Comments: 228
Rick Perry's comments during this week's GOP debate at the Reagan library has caused quite a stir in the liberal media. During the debate, Governor Perry defended the words in his book, calling Social Security a "Ponzi scheme". After the debate, the "analysis" on MSNBC was truly fun to watch as every commentator sat shelled shocked over the fact that a politician would dare to use these words to describe America's most sacred welfare program. The only person on the panel who had a clue about what might be going on was Ed Schultz who at one point questioned whether or not whether young people would stick with Obama or jump on the Perry bandwagon. Unlike the political and media establishment in this country, young people understand that they are going to get the short end of the Social Security "inter-generational compact". Schultz surprisingly realized that Perry's message might resonant with young people. Let's take a quick look at the Social Security system and see if Perry might be on to something. The people who got into the Social Security system very early got back on average 15 times the amount of money they paid in. They got a great deal and were raving proponents of the system. The people receiving Social Security benefits today are getting back on average 2 1/2 to 3 times what they paid in. They are also generally strong proponents of the system. Today, Social Security is paying out more every year than it takes it. We are borrowing money from the foreigners, like the Chinese and Saudis to pay current benefits. As the huge Baby Boom generation retires, the amount of debt we incur each year will quickly escalate until it blows up in our face and old people without resources really do wind up in the street. So, what happens when my generation starts to retire in 15 to 20 years and what will happen to my kids? We will all be left holding the bag. There is a financial MODEL that describes this. The model is called a Pyramid scheme or Ponzi scheme or a Bernie Madoff scheme. The people who get it in early make out like bandits and the people who get it late get screwed. That is exactly how the Social Security system will play out. The fact is that the Social Security is a pay-as-you-go welfare system that transfers money from young, struggling families to relatively well-to-do retired people. There isn't any "trust fund". The words "trust fund" are used to describe a mountain of debt. A mountain of debt is NOT a trust fund. It's a mountain of debt. Today, the mountain of debt in the Social Security system is so great that it cannot be paid. Peel away the emotion, the Orwellian language about the "trust fund", and the other political rhetoric, and just look at the financial facts. Then this all becomes very clear. Rick Perry is absolutely right and I am actually impressed that a politician would tell the truth about this. It's truly amazing. The big question is what can be done? Long term, people need to be able to save for their own retirements. Social Security needs to be taken back to it's roots as a program that supplements the income of retirees who are truly poor, through no fault of their own. Today, 25% of people over 65 have pension or investment income that places them in the "wealthy" category. They still get Social Security benefits, so long as they don't work for their income. Why should young struggling families hand money over the wealthy retired people? They shouldn't. Means testing Social Security will go a long way to make it solvent for the future. When Social Security was implemented, the retirement age was 65. The average life expectancy was 59 for men and 61 for women. Most people didn't live long enough to get a check. Today, the retirement age is still 65. However, life expectancy is 73 for men and 78 for women. The math just doesn't work. We need to gradually raise the retirement age to keep up with life expectancy. Bravo to Perry for telling it like it is. I certainly agree with Ed Schultz that a lot of young people will find this message appealing. The other group who should find this message appealing are wealthy retirees who are stealing from their children's and grandchildren's future. Will they finally put their selfishness aside and say: "no more"? Probably not, but we'll see.
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#1. To: All, sneakypete, hondo68, A K A Stone, BorisY, Captialist Eric, CZ82, Murran, no gnu taxes, nolu chan, e_type_jag, We The People (#0)
Those who are on the retire at 65 plan should hold the gov to their contract. Teenagers just starting work should be given the option of not participating in the SS ponzi. The racketeers in congress can raise the retirement age, but only for those who agree. Any (most) congress-criters who participated in the theft of retirement funds are eligible for trial, and jail. Ya, like that's really going to happen in the good 'ol boy club!
#5. To: hondo68 (#4)
I guess those would be the guys who voted for the Bush tax cuts and signed the "no new taxes" pledge.
There is no enforceable contract. The government can take it away or define it out of existence. Look at the promise of free heatlh care for life for military vets after 20 years active duty service. Promised military benefits were provided in writing. http://usmilitary.about.com/cs/joiningup/a/recruiter12.htm Part 12 - - Military Medical and Dental Care By Rod Powers, About.com Guide Continued from Part 11 If the recruiter promises you free health care for life, turn around and run (or find another recruiter). Seriously, up until the mid 1980s, recruiters were promising just that. It wasn't their fault -- up until that time there was free health care for life. Any military retiree, and their immediate families, could get care (space available) at any military medical facility. That law hasn't really changed. What has changed is the "space availability" of health care. As a result of down-sizing, 35 percent of the military hospitals that existed in the United States in 1987 are closed today. Several dozen others have cut services. The number of doctors, nurses and medical technicians in military service has declined along with the number of other service members. Despite this, the total number of people seeking health care through the military’s health care system has dropped only slightly. Slowly, but steadily, military retirees, their families, and many active duty family members, were forced to seek medical care off-base, with only partial reimbursement from a program called CHAMPUS (Civilian Health and Medical Program of the Uniformed Services). Those who could still receive care through the military medical facilities found that even urgent care appointments were taking weeks -- if not months -- to obtain. Let me say right from the start: The current military health care system (Tricare) is not bad when compared to most civilian health care plans. We have a health care cost crisis in this country, and Tricare is certainly one of the least expensive plans available anywhere. However, many military veterans and retirees are understandably upset with the provisions of Tricare for two primary reasons: Up until this year, retirees completely lost their Tricare benefits when they become eligible for Medicare. A new law now allows Medicare eligible retirees to use Tricare to pay any costs not covered by Medicare. To use this benefit, retirees must be enrolled in the Medicare "Part B" plan. Active duty military members and their dependents receive free medical care, under the Provision of Tricare known as "Tricare Prime." This works kind of like an HMO. The member (and his/her dependents) are assigned to a "Primary Care Provider," which is usually (but not always) the base hospital. The Primary Care Provider takes care of their medical needs, and makes authorized referrals to specialists when they don't have the capability to handle the problem. Guard and Reserve. Members of the Guard and Reserve (and their dependents) can use any of the Tricare Options anytime the member is called to active duty for more than 30 days. Use of Tricare Prime is free, as it is with active duty family members. Health coverage is also provided up to 90 days prior to activation for servicemembers who receive a 'delayed-effective-date' order. The coverage lasts until 180 days following their activation. After that 180 day "transition" period, following activation, Guard and Reserve members can purchase special Health Care Coverage under the Tricare Reserve Select program, if they were activated for a contingency operation for 90 days or more. Dental care is free to active duty members and to members of the Guard/Reserve who are on active duty, but not free to non-mobilized Guard/Reserve members or military dependents. However, the services have a family dental plan which -- for just a few bucks a month -- gives dental insurance coverage to military family members and non-mobilized members of the Guard/Reserves (and their families). Military Health Care - The Issue of Promised Benefits - CRS Report 98-1006F Updated 12aug2003 At 4: This language, of course, does not mention “free” health care. Nor does it mention that such care is to be provided via the military health services system and/or in military facilities. This advertised statement is correct in that military retirees do receive their promised lifetime benefits via MTFs (including space- or serviceavailable care in retirement), Tricare and Medicare — all earned as a result of their federal military service. The health care promised to be provided is not promised to be free, and at disappearing military medical facilities it is on a "space available" basis. There might be "space available" for a retired senior officer, but there is no "space available" for the lowly enlisted retiree.
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#4. To: jwpegler, *The Two Parties ARE the Same* (#1)
Replies to Comment # 4. Any (most) congress-criters who participated in the theft of retirement funds are eligible for trial, and jail. Ya, like that's really going to happen in the good 'ol boy club!
#7. To: hondo68 (#4)
Those who are on the retire at 65 plan should hold the gov to their contract.
What the Recruiter Never Told You
They feel they were promised FREE health care for life in exchange for a minimum commitment of 20 years. Veterans believed this promise, and put up with dismal work/living conditions and low pay in order to win this compensation. Many retirees and veterans feel that their Government lied to them.
Numerous claims have been made concerning “promises” to military personnel and retirees with regard to health care benefits. Many appear to believe that they were “promised free health care for life at military facilities.” Efforts to locate written authoritative documentation of such “promises” have not been successful. However, some military recruiting literature does make general statements about health care. As an example, a recruiting brochure cited by The Retired Officers Association states:
Health care is provided to you and your family members while you are in the Army, and for the rest of your life if you serve a minimum of 20 years of Federal service to earn your retirement.
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