In the Think Tank today, John Mauldin writes about Social Security, calling it a “Catastrophic Success.”
John believes SS is a Ponzi scheme, and we disagree. He comes from a different country than I do — John lives in Texas, while I live on a small island off the East Coast of America — two completely different regions only technically existing on the same planet. And since this meme comes from John’s governor, Rick Perry, he seems compelled to want to defend Perry’s view, regardless.
A Ponzi scheme is an illegal and deliberate attempt at scamming people out of their money. Social Security is a national insurance plan created to address the issue of Seniors living in poverty. Hence, my view is that Perry’s Social Security chatter is unvarnished nonsense.
At present, Social Security is financially stable. As I told John earlier this week, it starts to run into increasing deficits over the next 3 decades, and the adults (assuming any still exist) in the political classes will be forced to respond by raising the Retirement Age, raising the cap on FICA contributions far above the $106k of today, and then instituting Means Testing so people like me won’t qualify. If we were adults in this nation, we would be discussing Medicare/Medicaid and the absurd costs of Health Care in the USA, but that is a different issue entirely.
“Saving” Social Security (June 17th, 2010)
SSA.gov: Ponzi Schemes vs. Social Security (2009)