Mr. Rasmussen singles out Mr. Johnson

It seems the Rasmussen group has taken a special interest in Wisconsin Republican Senate candidate Ron Johnson. There’s a new survey out about Johnson’s assertion that Social Security is a Ponzi scheme.

The spouse and I chatted about it this afternoon. (Not your afternoon. I’m in a bit of a time warp right now.) We both agree Social Security is a Ponzi scheme.

Perhaps not in the strictest dictionary definition, but when one considers the benefits of the current retirees can only be paid by the current workers, and the setup only survives if there are new players – those willing to work and add to the pool – then yes, it’s a Ponzi scheme.

Steve Eggleston writes some pretty detailed stuff about Social Security if you want to follow him. While I confess I don’t know every detail, I’m incredibly sure I’ve known to never plan for my retirement from that pool.

So what do you think? I’m particularly interested in the left response. Do you think Social Security will be there when you retire? No, it’s not enough to say you paid for it. Really, will it survive?

Comments

  1. Couple things,

    I would agree that Social Security, by loose definition, is a ponzi scheme but it’s important to remember one important thing:

    Social Security has always been paid for by a regressive tax (the payroll tax) which impacts everyone below the $100,000 income level. The “surplus” generated by the payroll tax paid by the middle class, has mostly been redistributed upward via income tax cuts throughout the years (more recent years primarily). Income tax cuts (our more progressive form of taxation) tend to benefit upper middle and upper class Americans (who pay more in income taxes than payroll taxes). In other words, social security is a ponzi scheme that needs new players willing to work in order to keep the program going, however, to assume that Social Security’s, “solvency” problems rest solely on the fact that more people are receiving benefits than paying into it are a bit misleading. Social Security surplus funds have been redistributed upward for years.

    As for whether or not I think it will survive long enough for my generation to receive benefits? Sure. Why not? Social Security is just one large program within the total Federal budget. We can fix Social Security, directly, by lifting the cap on the payroll tax or, indirectly, by increasing overall Federal tax receipts via an income tax increase or we can choose to offset the shortfall via spending cuts in other areas (Medicare, military, whatever).

    I think it’s safe to say that we need to do a lotta each in the coming years.

  2. I believe that Social Security can survive only as long as we can keep the GOP from turning it over to Wall Street. Then there will be no safety net for the very poorest and no guarantees for the Middle Class.

    It would be, to coin a phrase, the biggest scheme for the redistribution of wealth that the country has ever seen.