Charles opines that there is one difference between Social Security and a Ponzi scheme: participation the former is mandatory. But that distinction is of little moment because law is impotent to command the impossible. Social Security, too, must collapse; just as in Ponzi’s fraud, there are not enough later entrants to make good on the outlandish promises that have been made.
I freely concede that Charles goes on to argue for Social Security’s preservation. He would “fix” it, in essence, by expanding on the fraud. Charles posits that Social Security’s humane upsides (which I believe he overrates) outweigh its fugazi design. Consequently, rather than scrap it in favor of a more transparent welfare program, he reckons it would not be unreasonable to maintain the “insurance” charade by, among other things, extending the retirement age and adding a “means-test for richer recipients.” The idea is that, having trod this far down the Ponzi path, we might as well take the next logical step of breaking it to “investors” that the harder they work and the better they do, the tinier the “dividends” that await them in a more distant future.
My column offered contrary views on how we ought to deal with so-called entitlements. For present purposes, though, the point is that Charles’s portrayal of Social Security in “Of Course It’s a Ponzi Scheme” is not very different from what Ron refers to as my “more than foolish” assertion that Social Security is a “fraud designed to create dependency on the government.”
And I’m fairly confident that, if I were a progressive New Deal devotee sitting in Jon Stewart’s audience, listening intently to a prominent conservative dilate on Social Security, I’d find “Ponzi Scheme” a teensy bit less ingratiating than “great achievement of liberalism.”