We've all heard the claim that "social security is a Ponzi scheme." While I do believe it is, I have a question: what exactly makes the mechanics of private insurance different than a Ponzi scheme/SS if SS is essentially a Ponzi scheme (other than the obvious fact that SS is compulsory and tax funded and private insurance is not, of course)?
One of the key attributes that makes Social Security the Ponzi scheme that it is is that its methods for attaining funds are, in the long-run, bound to not work due to changing population demographics. Being a pay-as-you-go system, Social Security does not save any of its excess money, instead it places it in a "trust" with Congress that is immediatly spent, rather the money going out to recipients of Social Security every year depends on the income it taxes every year. Eventually, when there are not enough people being taxed by Social Security to support the droves who are on it, Social Security will fall like a house of cards. Its a Ponzi scheme because its an easy way for the government to get money, as of now there is more income for Social Security than expenses, but eventually it will fail as its obligations are greater than its income.
Abstract liberty, like other mere abstractions, is not to be found.
- Edmund Burke
Insurance is not a Ponzi scheme, because it is based on risk and payouts are not based on who joins first and who joins last. Payouts are based on need.
At most, I think only 5% of the adult population would need to stop cooperating to have real change.