A Bigger Ponzi Scheme Than Madoff's
Yesterday, Bernie Madoff was sentenced to 150 years in prison for stealing approximately $65 billion dollars from investors through a Ponzi scheme. The story in itself is uninteresting as anyone that commits fraud should be prosecuted. However, what I find interesting is that Madoff's fraud was committed through a Ponzi scheme and yet the perpetrator of the largest Ponzi scheme in the U.S. remains unscathed.
According to Wikipedia (bold mine): "A Ponzi scheme is a fraudulent investment operation that pays returns to investors from their own money or money paid by subsequent investors rather than from any actual profit earned. The Ponzi scheme usually offers returns that other investments cannot guarantee in order to entice new investors, in the form of short-term returns that are either abnormally high or unusually consistent. The perpetuation of the returns that a Ponzi scheme advertises and pays requires an ever-increasing flow of money from investors in order to keep the scheme going."
By that very definition, the U.S. Federal Government is running the largest Ponzi scheme in the history of mankind-- social security. The social security program is an investment that all Americans enroll in as infants upon receipt of a social security number. Throughout an individuals working life, the government takes money from their paycheck and supposedly saves it in a trust fund for their retirement. In reality, the government uses social security taxes to feed its spending habits and pay down the public debt. Thus, current recipients of social security are not even receiving the money the government was supposed to save for them-- instead, they are receiving money from the current working generation. Eventually, the working generation will no longer be able to support the retired generation-- the faucet will run dry. This is a concern with the baby boomer generation now retiring. The current National debt stands at about $11 trillion, but the GAO estimates that there is an additional $60 trillion of debt in the form of entitlement programs!
So, when will the U.S. government be prosecuted for defrauding American citizens?