The pundit universe was afire this past week over Gov. Perry's characterizing Social Security as a Ponzi scheme, one of the oldest forms of financial fraud, well-defined.
The Boston Globe, in its review of a book titled 'The Looting of Social Security' by Allen Smith Ph.D., characterized Social Security as "a national pension plan transformed into an outright shakedown of working people." Shakedown. The Boston Globe.
Gov. Perry and The Boston Globe agree that the Social Security system is, in fact, a criminal enterprise.
For the record, two hallmarks of Ponzi schemes are: (a) a non-existent or unsustainable means of getting yield from capital and (b) payments made to early investors entirely dependent on getting fresh money from later investors - creating an ever-growing need for more and more money from more and more new investors.
So how can any honest person say Social Security is anything but a Ponzi scheme? That's not inflammatory. It's stating fact. Social Security is entirely bankrupt. Its fictitious lock-box, as Dr. Smith describes in his book, has been looted and has nothing in it but IOUs. There is no actual financial model for yield from capital because there is no capital. As fast as new money comes in the front door from later, younger investors, it is paid out the back door to the earlier, older investors. The new investors are fraudulently told they're paying to fund their own retirement pensions. In reality, their money is going directly to the the older investors. Without that new money, the older investors would get nothing.
As is, it is a pure, simple, blatant fraud. Don't shoot the truth-telling messenger, Gov. Perry. Ponzi schemes can't be fixed. This must be replaced.
For the record, a shakedown is dictionary defined as both a 'swindle' and as 'extortion.' That, too, accurately describes Social Security. Money is not voluntarily paid in. No sane person would. It is extorted. And it is used to sustain a swindle. Is this the sort of activity we want our government perpetrating?
Gov. Perry also got a lot of flak for suggesting that, should Bernanke amp up the Fed's printing presses and print, print, print more and more money - effectively stealing value from every already existent dollar, thus robbing every person who has those dollars in hand, in savings, in a needed paycheck, thus weakening the nation as a whole - he would almost be committing treason. The media almost universally omitted the word "almost" from the Governor's statement, almost committing its own fraud.
Treason is the betrayal of one's country. If Bernanke were to start printing money, he'd be knowingly and deliberately destroying the value of the nation's currency, inflicting harm on every senior on a fixed income and every equity holder, and making the country poorer and weaker. Why isn't it perfectly reasonable to term that almost treasonous?
On NBC's "Meet the Press," September 4, Congresswoman Maxine Waters said that President Obama needs to put forth a trillion dollars of new and additional stimulus spending attached to some epic jobs program. This suggestion is also almost treasonous. It has the same effect as endlessly printing new money and destroying value of existent money, and almost certainly mandates more of that. It doubles down on an inarguably failed wager by a woefully inexperienced, inept, and ideological president and his gang of academic theorist and socialism-leaning radicals. It would shamelessly attempt buying votes to renew the failed administration with another trillion dollars of deficit spending and debt. Its ridiculousness went unchallenged on "Meet the Press."
We can only hope the Republicans in the House have enough integrity, sense and backbone to challenge anything of this nature the President might dare propose. Compromise would be almost treasonous. We should encourage Gov. Perry and others of his mind, of his successful, practical experience, to speak out, often, forcefully. That is patriotic.