Now You Know

No, by the grace of God, you will NOT plead ignorance. You will NOT testify that you never knew any better because no one ever taught you anything better. You will not plead that you were never told.

Saturday, March 12, 2005

MartiniPundit Parses the Politicians' Ponzi Scheme

Matt of MartiniPundit does a great job of calling the Social Security system exactly what it is and what it always has been -- a Ponzi scheme.

But "Stop right there!" you say. "What exactly is a Ponzi scheme? What do you mean?"

The following is a definition of a Ponzi scheme, courtesy of

In 1919, a guy named Charles Ponzi convinced about a dozen people he could make them 50% profit in 45 days by an international trading scam. And sure enough, at the end of 45 days, he paid off. Each person got exactly what was promised, $375 for each $250 they invested. When word spread of this great opportunity, thousands ran to give Ponzi their money. What he was doing, of course, was using the money from the newest investors to pay off the oldest investors. As long as the crowds kept getting bigger, he was okay. He skimmed money off the top and started living high on the hog. Eventually, in 1920 the whole thing collapsed. and he went to jail for 10 years.

The Internet is allowing a new surge in the number of Ponzi schemes being promoted to unwary victims. Particular offshore havens known for lax regulation are part of the plan because they allow the promoters complete anonymity and banking secrecy to hide their ill-gotten gains. One program we saw
asks victims to invest a minimum of $25 to be paid back $1,000,000 in eight years. What do you want to bet the promoters won't be around when it comes to pay-back time? The problem is that the more patient the scammers, and the larger
the pot. There are also many more victims!

Promoters increase the number of participants by paying out promised returns to early participants. As in the case of Charles Ponzi, this creates a stampede of victims wanting to take part. Like a pyramid scheme, those entering the program later, get left holding the bag.
[Emphasis mine.]

Now can you see why Social Security truly is a Ponzi scheme as Matt of MartiniPundit accurately and truthfully asserts? Those who paid into it at its early stages really did receive returns as promised. However, those returns were not the result of their money having been invested in something that earned money for them. No, those payouts they received came from those who came later and were paying into the same scheme.

And so it still goes. The problem is, the Ponzi politicians are rapidly reaching a point where they won't be able to rake in enough money from the "newer" victims of the scam in order to pay off that which was promised to the earlier duped participants. At that point, both newer and earlier dupees will be left with nothing.

Please read all of Matt's post. Also read the post to which he links, which was written by Christopher G. Adamo of The American Thinker.

This is your future, folks. This is the future of your children. This is the future of your grandchildren. Just which generation would you prefer to be left holding the bag when this Ponzi scheme at last blows up? Would you prefer it to be your own generation that is left with nothing? Would you prefer it to be your children's generation? How about your grandchildren? Self-preservation and selfishness aside, what kind of cold and callous monster does it take to leave its offspring deliberately destitute?

I pray to God that you and I are not that kind of monster.

You've been told and NOW YOU KNOW.