Editorial
SS: Ponzi Scheme Isn't the Problem
Everyone by now knows what a Ponzi Scheme amounts to. We all became familiar with it when Bernie Madoff was caught using it to amass a fortune at the expense of clients who were unaware that his plan to put away money for them amounted to such a scheme.
The issue in the case of Madoff wasn't actually so much the scheme but the lack of full disclosure about it. Ponzi schemes are legion around the world and people knowingly take part in them. For instance, most insurance companies use them, collecting funds from new clients and paying old ones in part from the newly acquired cash. Retirement systems make use of the scheme, as well. Those who have paid in are often receiving the funds new clients pay now. And so with the Social Security system. The Social Security system would be no problem if it were voluntary and those who are part of it knew from the start the risks involved.
Fractional reserve banking is like that, too: When people deposit their money in banks the money isn't all left in vaults until they withdraw it; rather, much of it is used to give loans and make investments. And clients of the bank know this but figure the bankers are skilled at what they are doing and will not use the funds recklessly, irresponsibly. But the bankers do not expect all custumers to suddenly withdraw their funds; the banks could handle that. But since it is common knowledge, nothing is amiss in such arrangements.
So that's not what's wrong with the Social Security system. The problem is that when you work, you are forced to be part of them system (with only some exceptions, such as when the state you work in has its own similar scheme in play). This, like the income tax, is a form of extortion, just like what happens when organized criminals force merchants to cough up money for them or lest they burn down the business! Sending working people to jail or imposing immense fines on them unless they pay their taxes, Social Security or otherwise, is just like that. One has no choice if one wants to make a living: "Pay the government or have no job!"
When Republican candidate Rick Perry called the Social Security system a Ponzi scheme, a bunch of his critics, even fellow Republicans, expressed shock. Their ire, however, is misplaced. The Republicans have no more leverage with pointing out that Social Security is mandatory than would the Democrats. Republicans and Democrats both – indeed, all political parties other than the Libertarians – favor extorting funds from the citizenry, though for different purposes. So what they argue about isn't really all that important. Ponzi schemes are everywhere. What is much more problematic is when everywhere some people force others to carry on in certain ways, to take part in various schemes, whether they or not they chose to do so.
If there is a feature of the modern world that is basically different from ancient systems is that it is less enamoured by outright force – slavery, serfdom, torture, etc. Such things are these days more widely seen as uncivilized, barbaric. And if a political system or public policy embodies coercive force that some use on others, it is now more suspect than it was in olden days – not everywhere, of course, and not even in so-called Western democracies. After all, democracies can contain a great deal of coercion and do everywhere you look. Still, the coercion in democracies is less brutal than in systems with top-down dictatorial rulers, such as the ones in the Middle East.
What needs to be discussed about Social Security is not the Ponzi scheme element but that it is forcibly imposed on all working people in the country, nevermind whether they want it or not. It would be quite enlightening if this aspect of Social Security were debated. That would bring up a central feature of most governments, namely, their coercive nature. That is what the American founding fathers and framers were concerned about. And while they didn't reject all coercive policies – e.g., slavery, taxation – they were very hesitant about them.
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Posted by Bischoff on 09/24/11 11:27 AM
Since you do not understand "money", and since you do not understand that one cannot "save" an "irredeemable currency, all your arguments are rendered mute. I am sorry, but that's a fact.
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Posted by Bischoff on 09/24/11 11:00 AM
Speedy,
Tell me about how Social Security was developed. What exactly was it designed to do... ???
Can you cite the statistics which show that 50% of seniors lived in poverty at the time, and can you tell me how this widespread impoverishment came about... ???
I don't think you have an answer for any of those questions. My conclusion is that your response to my comments are strictly ideological claptrap driven by emotion.
How is Social Security more successful than allowing people to save on their own with a "redeemable" currency... ???
Reply from The Daily Bell
"How is Social Security more successful than allowing people to save on their own with a "redeemable" currency... ???"
Good question!
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Posted by speedygonzales on 09/24/11 01:54 AM
"When Republican candidate Rick Perry called the Social Security system a Ponzi scheme... "
Rick Perry is Tea Party aparatchik. There is a lot of similarities between Tea Party, NSDAP and Soviets.
NSDAP was founded as DAP by aristocratic Thule Society and baron Rudolf von Sebbotendorf. Purpose was break up labor's social movement lead by, so called jews(even the term is not correct but for general purpose I keep slang) as Rosa Luxemburg, Carl Liebknecht or Elsner which lead to German revolution 1919.
To understand absurdity that DAP was founded by Thule (Thule is one of the four sinked continents. Thule was at north.There is root of term Nordic race) is like if Bush's Skull and Bones will found American labor party. This is not gonna worx at all now and it did not then. Nazi Movement was sponsored by German, and Euroepean aristocracy- there were revolutions in Hungary, Poland and civil war in Finland in that time lead by so called jews. Just do not connect this guys with bolshevik revolution in Russia, please. This is different story.
Purpose of this movement was improve life of working and middle class against bourgeoisie. The real story of bolshevik revolution started in second half of 18th century when Khazars decided to get back their homeland between Caspian and Black sea, rich for oil now.
First was Napoleon. During 19th century there was Khazarian movement-terrorism in Russia which lead to creation of Pale setlement and expeletion of Khazars from Russia. Russians move Khazars to then their territory in Poland got it after tripartition of Poland.
Tripartition was not caused by superpowers in this times as Poles will explain You, but it was proces of internal fight between higher and lower aristocrats in Poland. So leading 3 polish families asked their causins in Russia, Austria and Prussia to take security control over Poland, split Poland but keep them in control. That's what really happened. Lower aristocrats as Tadeusz Kosciusko or Kazimierz Pulaski knew what was going on so they had been expelled from Poland after rebelions, later became heroes of american civil war. Another well known rebels known in the USA was Lajos Kossuth from Austro-Hungarian empire or less known Maurice Benyovszky. England played big game on the Continent during lord's Palmerston 19th century.
So those Khazar-rebels from Russia ended in Eastern europe and Germany not because they wanted to but because of someone else's interests.
And what they have done in Russia they did in those teritories as well. Finaly archduke Ferdinand was killed by masonic Black Hand conected to Scottish Rite. War war first exploded. Khazars had been pressed by zionist's movement to be loyal khazarian case to return to homeland, but their's homeland was already there in Germany, Poland and eastern europe.
They refused. But more. They were leading figures of social movement against interest of guess who? British empire as main sponsor of Khazarian case. It was british Balfour who gave Palestine to Rothschild in 1917 even it was not Brititish territory.Yes. You got it. British empire used khazarian case as main force for their interests. Scenario is the same to this days. We have opressed minority and we have tyrants who are breaking human rights. Actions of Russia were similar to US durring WW2 with japanese americans.
Come back to Tea Party. Main sponsors of Tea Party are Koch bro's. As Bush's fortune was based on nazi era Koch's fortune was done- watch this:
"The Roots of Stalin in the Tea Party Movement
The Koch family, America's biggest financial backers of the Tea Party, would not be the billionaires they are today were it not for the godless empire of the USSR.
The Tea Party movement's dirty little secret is that its chief financial backers owe their family fortune to the granddaddy of all their hatred: Stalin's godless empire of the USSR. The secretive oil billionaires of the Koch family, the main supporters of the right-wing groups that orchestrated the Tea Party movement, would not have the means to bankroll their favorite causes had it not been for the pile of money the family made working for the Bolsheviks in the late 1920s and early 1930s, building refineries, training Communist engineers and laying down the foundation of Soviet oil infrastructure."
Click to view link
So now we have former nazi cooperators to being conspirators, war criminals , supporting enemy while country is in war:
"Amazingly, the two American contractors in the 7th Circuit decision were known by the military to be working undercover for the FBI, to whom they had reported witnessing the sale of U.S government munitions to Iraqi rebel groups."
Click to view link
This so serious that I can not believe they did that. US governemt was selling amunition to people who were killing our bro's and sis's. Daily Bell is "well known" for writing conspiracy stories, helping enemies by watching RT and this activities are supporting terrorists. But this is from US court. The same guys are attacking wikileaks, planed attack Al Jazeera, keep Maning in their custody, run Gitmo, attack Click to view link, raid our houses.
Now we are gonna switch for better. Right. Nazi for stalinists. I personaly know few Tea Party guys from Texas. High positions. Judges, mayor. One day they asked me review one of their publication. It was horror for me just to read not to imagine what this could do in head of typical midwest rednex. Their dictionary was full of :Marxism,pogressive, libs,dems,nazi, Stalin,constitution and bible. This scared me to death. Propaganda.
For them was Sarah Palin "perfect" candidate. I thought that am on different planet. Come back to Perry. When Teaxas executed- this is their rednex culture- teenager this year, Perry said that international law does not apply to Texas. Constitution of every modern country in civilized world has one clausule: ... internatational law and agreements apply in the case when they guarantee higher standard of civil rights. This not case in Texas. But as soon as Texan will be in custody for smugling drugs, let say in case of Waco, then there will be call for international law. You are trying make us stupid, Mr Perry?
Social Security is not a Ponzi schem. It is not given by government but is earned. It is not surprise that government who sold amunition to the enemies in war time screwed up Social Security as well.
And this is all about Rick Perry and the Tea Party. They offer exchange nazi profiteers for stalinism profiteers. But we have to hate it. We have to hate nazi,bolsheviks,jews,Stalin, commies. So they can profit from it. Make sure you are not anti-semite, pro-commie or supporter of enemies or terrorists. Make sure You are stupid enough to be in their box. Otherwise You are enemy of the state. City of London, Vatican, D.C. They will find something against you, don't worry.
Since Perry is just another puppet of his masters who knows how to manipulate mases he is just saying what they need.
Reply from The Daily Bell
Speedy, the initial Tea Party impetus was Libertarian and came out of the Ron Paul movement. Much of this feedback is interesting, but please check your facts.
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Posted by speedygonzales on 09/23/11 12:01 PM
Republicans hate Social Security because it has been an extraordinary success and has done exactly what it was designed to do. It is the most successful government program in our nation's history and is enormously popular.
When Social Security was developed, 50 percent of seniors lived in poverty. Today, that number is 10 percent -- still too high, but a testament to the success of Social Security.
Click to view link
Reply from The Daily Bell
Oh, come on Speedy. It is true that less seniors live in poverty perhaps, but wait a few years. The whole system seems to be imploding.
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Posted by speedygonzales on 09/23/11 11:58 AM
Answeringing the Big Lies
The Social Security Administration is an independent federal agency with its own revenue stream and depository fund: IT IS NOT A PART OF THE FEDERAL BUDGET! On March 31, 1995, the Social Security Administration was officially designated as an independent agency. The Federal Old-Age and Survivors Insurance (OASI) Trust Fund was established on January 1, 1940 as a separate account in the United States Treasury.
The federal government scams workers by placing the Social Security fund within the federal budget, as if it were merely a part of the revenue stream. Social Security is not an "entitlement program" paid for by government taxes. It is a completely separate program with its own revenue stream and retiree payments. Social Security is paid for by employees and employers, as is Medicare. The benefits provided by Social Security are earned, not bestowed by the government. None of the Social Security funds can legally be "borrowed" by the federal government.
According to the 2008 Social Security Trustees report, the Social Security Administration runs at a surplus of about $190 billion per year. Using any realistic view of the U.S. economy, the Social Security System will stay solvent, in fact reap a surplus, throughout the entire twenty-first century!
This Social Security trust fund system is one of the few programs set up by the federal government that continues to operate successfully. To take a sample year, in 2002, the SSS received $627 billion in checks, $453.8 billion in taxes, and an additional $49 billion in interest. Instead of red ink, Social Security made almost $102 billion in profit, to add to the trillions it has in surplus from previous years.
The impact of Social Security benefits on the lives of citizens and on local economies is incalculable. In 1995 Social Security paid $340 billion in benefits.
The Vultures Are Circling Social Security
The Wall Street Journal let the cat out of the bag, announcing that even under moderate privatization plans, $60 billion a year would flow into mutual funds managed by Wall Street, instead of going into the Social Security Trust Funds.
The actual Ponzi scheme going on is the cabal's continual printing of unsecured currency by its privately owned and operated Federal Reserve System.
"The real problem is that both Democrats and Republicans want to fund endless wars, give endless bailouts to the too big to fail banks and corporations, and perpetuate the expensive Ponzi scheme of printing money out of thin air."
Click to view link
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Posted by Bischoff on 09/19/11 03:06 PM
"What needs to be discussed about Social Security is not the Ponzi scheme element, but that it is forcibly imposed on all working people in the country, nevermind whether they want it or not."
The question is why was it forcibly imposed on working people... ??? There was no social security and then there was "Social Security" legislation. Why... ???
The reason lies in the realization by federal politicians that when American citizens where prohibited from holding gold, their ability to save on their own to provide for old age was taken away from them.
Currency created by monetizing debt might be a currency useful for immediate expenditures, but it could never be a vehicle for one's savings to be available in old age. The federal politicians who passed the 1935 Banking Act knew this perfectly well. That is why they also passed the Old Age, Survivor and Disability Insurance (OASDI) legislation, aka Social Security Act in 1935.
Any discussion about Social Security will invariably lead to the question of the workability of "central banking" to allow savings. Do you really think such "Social Security" discussion will ever be allowed to involve the greater public... ??? I rather doubt it, despite Rick Perry's "stirring of the pot" with his "Ponzi Scheme" remark.
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Posted by Joelg on 09/19/11 01:54 AM
Excellent editorial. One of the ways the two parties collaborated was when Bob Dole and Jimmy Carter got together in the 1980s to "Save" Social Security (SS): They subjected the self-employed, the bastion of freedom in capitalism, with both worker and employer SS taxes. Until recently that amounted to about 15% of earnings for SS in addition to federal, state, and other taxes. I knew back then that the GOP, if not a total fraud in their support of the values of individuals in business, was curiously indifferent to capitalism at other than the level of the mega-corporation. That undermining of the old American notions has helped erode this country as a viable enterprise, and laid the red carpet for the Democrat's socialist agenda that also favors the big corporations as pillars of the state via campaign donations. It's like the hip bone is connected to the knee bone -it is all interrelated, and we can't blame it all on the Rothchilds.
Of course they can never make it voluntary, as what sane self-employed person would ever fork out 15% of income for SS for a return that would be less than investing it elsewhere. At the same in the 1980s, the Federal government changed the payout formula so that for forthcoming cohorts the SS retirement payments will be based on the TOP 38 Years of earnings, rather than the current 5 years. For people graduating school with huge education debts to payoff, I think they will be doing well just to live above the poverty level. With SS and federal, state, and other taxes and fees taking close to 50%, even doctors and lawyers will be lucky to afford much.
