Likening Social Security to a “Ponzi Scheme” is Now a Mainstream Republican Party View
September 21, 2011
It’s Official: Likening Social Security to a “Ponzi Scheme” is Now a Mainstream Republican Party View In Light of Blessing by House Budget Committee Chairman Paul Ryan,
SEE: Huffington Post: “Paul Ryan Supports Rick Perry: Social Security Is A Ponzi Scheme”
Statement from Jeremy Funk, spokesman, Americans United for Change: “While virtually all current Republican presidential hopefuls including Mitt Romney and at least 108 Republicans in Congress are on record in support of privatizing Social Security and gambling Americans’ guaranteed benefits on Wall Street, most use sugar-coated rhetoric in public to obfuscate their goals and confuse seniors. In recent months, however, more and more Republicans began to wear their contempt for Social Security on their sleeve – like Congressman Tim Walberg calling it “socialism”, or like Congressman Joe Heck calling it a “pyramid scheme,” or like Senator Ron Johnson, Congressman Todd Young, Indiana Governor Mitch Daniels and of course Governor Rick Perry all assailing as a “Ponzi scheme” the hugely successful pay-as-you-go social contract with Americans that has kept generations of seniors, survivors, and people with disabilities out of poverty. Perry took his derision a step further, claiming Social Security’s very existence is unconstitutional.
“But while deceitfully comparing Social Security to a “Ponzi scheme” is clearly and completely out of step with the American people, the radical view became mainstream in the Republican Party this week when Congressman Paul Ryan did exactly that. When Paul Ryan -- the architect behind the Republican budget plan to end Medicare that virtually all GOP presidential hopefuls embrace and virtually all Republicans in Congress voted for – says ‘jump,’ Republicans say ‘How high?’ And now that Paul Ryan has joined Rick Perry, the Republican presidential frontrunner, in denouncing Social Security as fraud, Americans will no doubt soon be subjected to this same extreme rhetoric over and over again from Republican politicians at all levels.”
FLASHBACK: Sept. 2010: We Saw This Coming a Long Time Ago: “Video: Young Gun Paul Ryan Gunning for Your Social Security”
Paul Ryan Supports Rick Perry: Social Security Is A Ponzi Scheme
By: Jordan Howard, Huffington Post
First Posted: 9/20/11 04:23 PM ET Updated: 9/20/11 04:24 PM ET
WASHINGTON -- Speaking on conservative radio on Tuesday, Rep. Paul Ryan (R-Wis.) agreed with Texas Gov. Rick Perry's (R) claim that Social Security is a "Ponzi scheme."
When asked by host Laura Ingraham on Tuesday whether the country's social insurance program is a Ponzi scheme, Ryan replied, "That is how those schemes work."
"So if you take a look at the technicality of Ponzi -- I would -- it's not a criminal enterprise," he said, according to a transcript. "But it is a pay-as-you-go system where ... earlier investors or, say, taxpayers, get a positive rate of return and the most recent investors -- or taxpayers -- get a negative rate of return."
Democrats immediately criticized Ryan's comments.
"Republican Budget Committee Chairman Paul Ryan's belief that Social Security works like a Ponzi scheme proves -- once and for all -- that House Republicans have really declared war on seniors," said Jesse Ferguson, a spokesman for the Democratic Congressional Campaign Committee, in a press release. "A Ponzi scheme is Bernie Madoff ripping off American -- not Social Security benefits that seniors earned and depend on during retirement."
Ponzi schemes, made famous in 1920 by Charles Ponzi, are predicated on delivering large returns to investors with money received from new investors. The Securities and Exchange Commission definition of a Ponzi scheme is, "an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors."
Since then, some Republicans have come out in support of the governor, including Indiana Gov. Mitch Daniels (R) who said, "As far as it [Social Security goes, absolutely [it is a Ponzi scheme]."
Additionally, this past June, Reps. Pete Sessions (R-Texas) and Jeb Hensarling (R-Texas) introduced legislation that would allow workers to partially opt out of Social Security immediately and fully opt out after 15 years.