Scheming The Citizenry

Charles Ponzi must be spinning in his grave while Bernie Madoff is presumably bewildered in his jail cell.

During the CNN GOP debate last night in Tampa, GOP front runners Mitt Romney and Rick Perry battled it out once again over whether Social Security is a Ponzi scheme. Take a listen:



This debate is very healthy, and quite telling about how we arrived in the mess we are in and where we stand as a nation.

For decades, folks from both sides of the political aisle have accurately labeled Social Security as a Ponzi scheme. For example, Jonathan Hoenig often battles Democratic strategerists on FOX Business Network making the case in pinpoint fashion.

In fact, Social Security is worse than a Ponzi scheme, as those involved with a Ponzi scheme engage the activity on their own, rather than being forced to partake.

Rick Perry is quite correct that this program is in need of extensive reform, as it is currently bankrupt and unsustainable. Although, as Perry correctly points out, Mitt Romney and a large contingent of pundits are attempting to scare seniors by implying they will not receive their benefits, they will not be impacted by any proposed changes. President Obama even proclaimed he could not guarantee checks for our seniors, in yet another inaccuracy out his arrogant mouth. Scare tactics aimed at our seniors in this perilous economic environment is pathetic, and it implies our seasoned citizens are ill informed.

Our senior community, as well as many of those who have freshly entered the workforce, understand that changes to the program are vital for it to survive, for the status quo is doomed for failure sooner than later. They appreciate the truth, something that is far too often missing in politics. Like health care, a private sector component to Social Security would be beneficial, and gives participants choices in investment vehicles which offer opportunities for greater return on investment.

It is time for the truth, and the Ponzi scheme known as Social Security is a great place to start the debate on reforming, or with any luck eliminating, dozens of entitlement programs that are in fact bankrupting our country.

Ultimately, the federal government should be out of this business, allowing individuals to plan for retirement in ways that best serve their particular interests. If a base of support is necessary, each state can produce programs that best suit the needs of its citizens. It will take decades for this to occur, but steps taken now through a broad initiative can begin the lengthy process.

For folks my age, mid forties, and below, retirement plan forecasts should not include anticipation of any return from Social Security. Folks saving for retirement should indeed focus on a collection of market base instruments for a solid return on investment.