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Bob Sanders Grammar Supervisor Magic Valley Ranch, Clanton, Alabama 20504 Posts |
As an old graduate university professor (marketing, management and finance) I can't say that there is any difference between Social Security in the USA and any other Ponzi Scheme. (I'm not defending either.)
Comments? Bob Sanders Magic By Sander |
Doug Higley 1942 - 2022 7152 Posts |
Sanctioning.
Higley's Giant Flea Pocket Zibit
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balducci Loyal user Canada 227 Posts |
A Ponzi scheme promises abnormally high rates of return and is designed for failure from the start.
If Social Security in the U.S. is a failure (and I am not saying it is, but IF it is) then it was turned into one along the way by politicians and others. It was not designed that way, as a Ponzi scheme is. Pay-as-you-go systems like Social Security work fine in other countries, but these systems are 'living things' that need to be maintained, monitored, and revised (in a thoughtful, conservative, forward-looking, non-partisan manner) as times change. These systems may not be suitable for countries that tend towards political gridlock for long periods, or that treat these systems as political footballs. This may also be of interest: http://web.archive.org/web/2001100716022......nzi.html
Make America Great Again! - Trump in 2020 ... "We're a capitalistic society. I go into business, I don't make it, I go bankrupt. They're not going to bail me out. I've been on welfare and food stamps. Did anyone help me? No." - Craig T. Nelson, actor.
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abc Inner circle South African in Taiwan 1081 Posts |
Please do not take me for an expert cause my banking days are long over and I am glad they are. Now I am just an English teacher.
The difference lies in Disclosure. You are going to pay for older people and younger people are going to pay for you when you get older. We are telling you in advance because that is how this system works. The money they pay gets recycled into the economy through spending and the expansion benefits those who pay and those who get paid. Ponzi is a flat out lie. They may look the same but there is no benefit too those who invest later or loose money because they get lied to through non-disclosure. Social security is a manageable (not the best) system. Maddoff is a thief. |
DeadDave Regular user Atlanta, GA 176 Posts |
There's a flag in front of the office. That's the only difference I can see.
Since Social Security paid out benefits starting in 1937 to people who had never paid into it, it too was destined to fail. It was worse than a ponzi scheme from the get-go. At least in a ponzi scheme, the early "investors" had to come up with some money to buy in. Not so with Social Security. |
balducci Loyal user Canada 227 Posts |
Quote:
On 2008-12-18 11:16, DeadDave wrote: In no way did that guarantee failure. Those costs could be estimated with high accuracy, and easily amortized (I believe that is the proper word) over a finite future span. It might have been unfair in some sense to the early payers, but that doesn't mean it was destined for failure. This was just a finite start-up cost, and those are common to all sorts of private and public sector enterprises.
Make America Great Again! - Trump in 2020 ... "We're a capitalistic society. I go into business, I don't make it, I go bankrupt. They're not going to bail me out. I've been on welfare and food stamps. Did anyone help me? No." - Craig T. Nelson, actor.
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Scott Cram Inner circle 2678 Posts |
When the original retirement age to begin receiving Social Security was set at 65, the average U.S. lifespan was 46 years.
If we kept the same ratio between life expectancy today and the age at which Social Security began paying out, nobody could start receiving Social Security until they were 106! |
balducci Loyal user Canada 227 Posts |
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On 2008-12-18 14:40, Scott Cram wrote: Where do you get 46 years from? The actual life expectancy (both sexes) in 1935 was 61.7 years. Source: http://www.cdc.gov/nchs/data/dvs/nvsr52_14t12.pdf
Make America Great Again! - Trump in 2020 ... "We're a capitalistic society. I go into business, I don't make it, I go bankrupt. They're not going to bail me out. I've been on welfare and food stamps. Did anyone help me? No." - Craig T. Nelson, actor.
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Scott Cram Inner circle 2678 Posts |
Oops. . . I didn't use U.S. census data. OK, Going by 61.7 years, and keeping the original ratio intact, Social Security today wouldn't pay until you turned 80!
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Magnus Eisengrim Inner circle Sulla placed heads on 1053 Posts |
But what about the standard deviations?
;) John
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned; The best lack all conviction, while the worst Are full of passionate intensity.--Yeats |
Turk Inner circle Portland, OR 3546 Posts |
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On 2008-12-18 16:42, Magnus Eisengrim wrote: John, It's my understanding that "standard deviants" are also included in the Social Security pay-out system--provided that they paid into the system and are now out of prison. (grin) Mike
Magic is a vanishing Art.
This must not be Kansas anymore, Toto. Eschew obfuscation. |
kregg Inner circle 1950 Posts |
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On 2008-12-18 16:42, Magnus Eisengrim wrote: In light of all of the present scandals it's more like deviant standards.
POOF!
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Bob Sanders Grammar Supervisor Magic Valley Ranch, Clanton, Alabama 20504 Posts |
Since the word "Trust" as in "trust fund" has no meaning in the US Government (Social Security), why would we put "In God we Trust" on our worthless money?
Bob |
Jonathan Townsend Eternal Order Ossining, NY 27297 Posts |
I believe what Bob was asking has to do with the amount of working people required to support the baby boomers as they go from working into retirement years.
...to all the coins I've dropped here
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Josh Chaikin Inner circle Kansas City 1430 Posts |
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On 2008-12-18 10:05, Bob Sanders wrote: Interesting, someone brought up the same point on the Dave Ramsey show this morning. It does fit the definition perfectly. There is a difference and that's that the government is involved with one, which makes it perfectly okay. |
balducci Loyal user Canada 227 Posts |
Quote:
On 2008-12-19 20:31, Josh Chaikin wrote: The economist Thomas Sowell has made the claim that Social Security is a Ponzi scheme. Maybe you heard him, or one of his disciples? However, in reality, there are many differences between a Ponzi scheme and Social Security in the U.S. Frankly, I think if people are confusing the two or equating one to the other, then they are most likely unclear about the concepts involved (or they have a personal agenda, see below). Social Security, incidentally, is funded until 2041. But with minor, minor changes (in the thoughtful, conservative, forward-looking, non-partisan manner I referred to previously), it can continue indefinitely with no problem. Any system that lasts 100+ years can hardly be called a Ponzi scheme. At least, not unless you are just trying to scare people in order to score political points. (Or possibly to sell books to sheeple. As Sowell is doing, perhaps.) Medicare, now, that is a different story.
Make America Great Again! - Trump in 2020 ... "We're a capitalistic society. I go into business, I don't make it, I go bankrupt. They're not going to bail me out. I've been on welfare and food stamps. Did anyone help me? No." - Craig T. Nelson, actor.
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MagiClyde Special user Columbus, Ohio 871 Posts |
Quote:
why would we put "In God we Trust" on our worthless money? There's an interesting history to that. The words "In God We Trust" first appeared on coins either during or shortly after the Civil War. It did not appear on paper money until the 1950's when McCarthyism was all the rage and it was felt that putting the phrase on paper and coin would show that our money was better than that of the "godless communists"! For more information, here is a link to the treasury website regarding ths phrase. http://www.treas.gov/education/fact-shee......st.shtml
Magic! The quicker picker-upper!
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Bob Sanders Grammar Supervisor Magic Valley Ranch, Clanton, Alabama 20504 Posts |
Quote:
On 2008-12-19 19:08, Jonathan Townsend wrote: Jonathan, You are right! When I was a young professor teaching economics, we taught that Social Security was "forced savings" held in trust for the depositors. That is no longer remotely true of the Social Security system in the USA. Today it is simply another tax on employers and employees. The beneficiaries are not related! There is no trust fund. The corpus has been invaded by the "tax and spend" political forces. It is an administrative function (like we needed another one!) that disburses current tax revenues. It functionally is the essence of a Ponzi scheme (just as we also taught that!). Bob Sanders Magic By Sander |
gaddy Inner circle Agent of Chaos 3526 Posts |
My goodness! Now that a big muckety muck in the investing world has just been indited on charges in relation to a ponzi scheme, now here we are talking about Social Security and comparing IT to a ponzi scheme...
How interesting! You know there's a word for this kind of fraud as well -It's called "The Old Bait and Switch..."
*due to the editorial policies here, words on this site attributed to me cannot necessarily be held to be my own.*
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Jonathan Townsend Eternal Order Ossining, NY 27297 Posts |
Bob, when was SS presented as a savings plan? I only heard about it as a transfer system.
...to all the coins I've dropped here
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