Bacon's Rebellion

Democracy Thrives in Sunlight

Kaine leaps into the Ponzi Pool

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Norm Leahy
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By Norm Leahy

I don’t begrudge Democratic Senate candidate Tim Kaine’s desire to stir-up the base with this meeting, or forum, if you prefer, on Social Security. It is amusing, though, to read the quote Wes Hester pulled from the Kaine campaign’s press release announcing the event:

A release from Kaine’s campaign announcing the Tuesday morning said that Perry “will no doubt promote the extreme Republican agenda which labels Social Security a ‘Ponzi’ scheme and seeks to privatize it.”

Damn those extreme Republicans and their wicked attempts to denigrate the most successful of entitlement programs…it puts them in the same league as that equally nefarious Paul Krugman:

“In practice it has turned out to be strongly redistributionist, but only because of its Ponzi game aspect, in which each generation takes more out than it put in. Well, the Ponzi game will soon be over, thanks to changing demographics, so that the typical recipient henceforth will get only about as much as he or she put in.”

One can only imagine what Mr. Kaine will have to say about that…

(H/T: Don Boudreaux)

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3 responses to “Kaine leaps into the Ponzi Pool”

  1. larryg Avatar
    larryg

    If one wants to be HONEST about the SS issue the very first step is to admit that FICA is what funds SS and not the income tax and that FICA is about 1/2 of the tax revenues in the budget and that no matter what happens to the income-tax side of the budget that FICA will continue – year in and year out to generate almost a trillion dollars worth of revenues to fund SS,.

    and that in a worst case scenarios with no changes that SS will continue to pay benefits but at a 75% level.

    that’s not a Ponzi scheme. A Ponsi scheme pays NOTHING.

    then we have the fiction that SS cannot change and should not change.

    in whose little world?

    SS has changed about a dozen times throughout it’s 65+ year history.

    including increasing FICA Taxes and reducing benefits…

    these changes happen to people paying into the system in prior years… so yes.. the benefit structure changed while they were paying into the system.

    As the ones whose retirement age got pushed on those whose SS benefits are now taxes.

    the biggest problem with the SS issue is the abject ignorance of even the folks who support it and that ignorance is taken full advantage of by those who oppose the CONCEPT of payroll taxes and SS.

    173 out of 193 countries in the world have some form of mandatory payroll tax and Social Security… so it’s not like it’s a unique thing to the United States to start with.

    the most significant aspect here is the use of bomb-throwing words to describe a program that has 1/5 the unfunded liabilities of Medicare Part B but the focus is on the program with the 1/5 problem..

    why?

    we are 1.5 trillion in deficit and SS has precious little to do with it but instead of addressing the things that ARE part of the 1.5T deficit, we focus on the thing that is not.

    why?

  2. Groveton Avatar
    Groveton

    Ponzi schemes pay nothing?

    C’Mon, LarryG – that’s not true and you know it. They always pay out the early victims at a handsome profit in order to lure in later suckers. You know, just like Social Security.

    Don’t believe me? As Paul Krugman. Or Chris Matthews. They both agree that it’s a Ponzi scheme. Both have made the point publicly.

    You are all alone, LarryG, all alone.

  3. larryg Avatar
    larryg

    SS pays out to everyone – just at a reduced rate – and this would not be the first time that it has happened… either…

    SS has changed over the years – to extend the age where you get benefits and to actually tax benefits of those with higher incomes.

    categorizing changes to the SS program as a Ponzi Scheme would be no different than calling a private health insurance changes to their higher premiums and lower benefits a “ponzi” scheme.

    the word itself is a bomb-throwing word used by those whose primary motivation is to vandalize the politics associated with changing programs to keep them solvent.

    I’ve not seen anyone call Medicare Part B a “ponzi” scheme. why?

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