It just is. Rick Perry is correct.
And it’s not because Congress is filled with nincompoops or the government is irresponsible, although both of these things are true. It’s because the program was actually designed as a Ponzi Scheme.
Many Social Security recipients are under the misimpression that they worked all their life, contributed their money to their Social Security savings, and now have a right to get it back.
That’s a mistake. Their money went to fund people who were retired. The money you contribute is not going to you, it’s going to grandpa.
When was the last time grandpa said to you or your parents, “Thank you for your money?” Did you know that grandma was using your money to buy the ingredients for those pies?
The first retirees covered by Social Security were not, in fact, told to go back to work until they were 100 so they could get their money.
No, they almost immediately started getting cash from current workers. And that’s how the system continued. A classic Ponzi Scheme in which new participants – that is workers – were needed to pay out benefits to those already signed up – Social Security recipients.
The reason this particular Ponzi Scheme is now crashing is that during the era – now ending – when the working population of baby boomers far outnumbered the retired population, and more money was coming into the system than needed to fund current retirees, Congress didn’t save the money.
IT SPENT IT.
Many people think there is a Social Security Trust Fund brimming with money to be dispensed to the elderly.
Well, there is a Social Security Trust Fund, but all that’s in it is IOUs from Congress. That’s why Social Security is headed toward bankruptcy. Because Congress doesn’t have the money, and will have to raise taxes or ask the Chinese for it, or just not pay up.
And that’s what Perry means when he says Social Security is a failure and why he accuses its creators of “violently tossing aside any respect for our founding principles of federalism and limited government.”
BECAUSE BY PUTTING THE GOVERNMENT IN CHARGE OF YOUR RETIREMENT FUNDS, YOU GAVE THEM TO SOMEONE UNTRUSTWORTHY WHO LOST YOUR RETIREMENT FUNDS.
Sure, Social Security is a lifeline to millions of Americans. But by putting the government in charge of it, its founders guaranteed that it would end up like most Ponzi schemes eventually do – bleeding cash and headed for bankruptcy.