SS Ponzi

Communication breakdown
It's always the same
I'm having a nervous breakdown
Drive me insane
--Led Zeppelin

During last week's debate among Republican presidential hopefuls, Texas governer Rick Perry referred to the Social Security system as a Ponzi scheme. This article implies that Perry was wrong, and quotes 'experts' on Ponzi and Social Security to validate this point of view.

The gist of the so-called expert argument is that an official Ponzi involves fraud while the Social Security system is 'above board.'

This is laughable. The cash collected by Social Security has been replaced by government IOUs (Treasury debt) for years. At some point, the system will not be able to pay a tranch of claimants unless the contract underlying the current system is broken.

This is precisely what occurs in a Ponzi scheme. The early participants in the system benefit at the expense of the latecomers.

This article also exemplifies a classic strategy of media bias. The author has a particular point of view to convey, and limits citation of outside 'experts' to those sharing a similar view. The legitimacy of the view seems to be reinforced.

But other views exist. Indeed, there is no shortage of other 'experts' who have written extensively on the Ponzi-esque nature of Social Security. Any journalist seeking balanced perspective could have easily incorporated alternative views here.

Instead, the tone of the article is that Perry wrongly shot his mouth off (which seems to be picture that many media outlets are attempting to collectively portray).

In reality, Perry's comments can be construed as accurate.