Forget the crooked CEOs at Enron or WorldCom. If a private corporation was run like Social Security, its officers would be hunted down by Eliot Spitzer and hung up to dry as the biggest fraudsters on Earth.
Social Security is a Ponzi scheme…there’s just no other way to describe it. Individuals are taxed a significant portion of their income, supposedly to pay into a trust fund to secure their retirement. But there are no accounts sitting in banks with names on them. Money confiscated from your income for Social Security is not saved or invested, but directly transferred to today's retirees. The only security in Social Security is the hope that future taxpayers' income will be transferred to us, just as ours has been transferred to others.
Liberals herald the "guarantee" and "safety" of government-run entitlements. Yet the truth is that every aspect of Social Security is up for grabs, not guaranteed, and unsafe. Everything — the age at which you are eligible for benefits, the level of those benefits — is subject to Washington's political whim. I'd sooner take my chances with a bank, a managed mutual fund or even the S&P 500, thank you very much.
Most insulting are those who suggest that although folks had the smarts to earn a living they’re not responsible enough to take care of it. So, when I hear Gretchen Morgenson, the hugely influential and Pulitzer Prize winning voice of the New York Times business section lecture me on Cashin’ In about the potential for “Enron style” disasters if people could invest their own retirement savings — well, I don’t know whether to laugh or to cry.
American is a country based on individual rights, not involuntary servitude from birth. Beyond the fact that Social Security is a shamefully fraudulent Ponzi scheme, the real reason it should be eliminated is that it's in direct conflict with the individualist principles on which this country was founded. Let it die.
This weekend our Business Block has much more on the Social Security dilemma. Tune in Saturday 10am - noon ET.
Jonathan Hoenig is managing member at Capitalistpig Hedge Fund LLC and is a markets columnist for Smartmoney.com. He appears regularly on FNC's business program Cashin' In.