The Anatomy of Social Security and Medicare

[Indium Flappers]

What say ye fair forum-goers to this article from the Independent Review? They claim thus:

Abstract

Do today’s retirees understand that they would have a pension two, three, or more times larger than their Social Security pension if they had been allowed to invest their FICA taxes in stocks? Despite Social Security’s monumental impact on the lives of ordinary Americans, it is probably the most poorly understood government program.

They make the common claim that Social Security is a Ponzi Scheme, but they also give data indicating a rather bleak future for social security recipients and attempting to back up the idea that people could have been better off had they invested their tax money in stocks and/or bonds instead of paying it in taxes.

Are they correct or no?

[Dardedar]

What say ye fair forum-goers to this article from the Independent Review?

Horrible.

Do today’s retirees understand that they would have a pension two, three, or more times larger than their Social Security pension if they had been allowed to invest their FICA taxes in stocks?

Bush ran on privatizing SS. Then his DOW tanked from 14k to 6.6k. Stocks are fun and I own several, but they are risky. SS isn't.

Despite Social Security’s monumental impact on the lives of ordinary Americans, it is probably the most poorly understood government program.

And these guys aren't helping with their idiotic misinformation. Speaking of bad sources, Mises is simply terrible, horrible. Be very skeptical.

They make the common claim that Social Security is a Ponzi Scheme,...

Revealing in spades they don't know what they are talking about. Let's smack this one now (then I'm off to bed). SSA has a very nice explanation of exactly why SS is not a Ponzi scheme, check it out:
http://www.ssa.gov/history/ponzi.htm
New link for that: https://www.usatrace.com/ponzi/

Excerpt:
"There is no unsustainable progression driving the mechanism of a pay-as-you-go pension system, and so it is not a pyramid or Ponzi scheme.
If the demographics of the population were stable, then a pay-as-you-go system would not have demographically-driven financing ups and downs, and no thoughtful person would be tempted to compare it to a Ponzi arrangement. However, since population demographics tend to rise and fall, the balance in pay-as-you-go systems tends to rise and fall as well. This vulnerability to demographic ups and downs is one of the problems with pay-as-you-go financing. But this problem has nothing to do with Ponzi schemes or any other fraudulent form of financing; it is simply the nature of pay-as-you-go systems." --ibid

Shoot, I see that link doesn't work. I'll find the article tomorrow, or you can snoop around. This politifact article gives a nice summary. Also this article. I guess the SSA article is toast.

but they also give data indicating a rather bleak future for social security recipients

Of course, because these right wing nuts hate SS and always have. And they like to lie about it too. SS is solid, and with small tweaks, solid as far as the eye can see.

Are they correct or no?

No. Not even close. But SS can get rather complex, so they have lots of room to cause confusion. Perhaps GW Bush had the most clear explanation on the conservative side:

"Because the — all which is on the table begins to address the big cost drivers. For example, how benefits are calculate, for example, is on the table; whether or not benefits rise based upon wage increases or price increases. There's a series of parts of the formula that are being considered. And when you couple that, those different cost drivers, affecting those — changing those with personal accounts, the idea is to get what has been promised more likely to be — or closer delivered to what has been promised. Does that make any sense to you? It's kind of muddled. Look, there's a series of things that cause the — like, for example, benefits are calculated based upon the increase of wages, as opposed to the increase of prices. Some have suggested that we calculate — the benefits will rise based upon inflation, as opposed to wage increases. There is a reform that would help solve the red if that were put into effect. In other words, how fast benefits grow, how fast the promised benefits grow, if those — if that growth is affected, it will help on the red."
—George W. Bush, explaining his plan to save Social Security, Tampa, Fla., Feb. 4, 2005

Just kidding.

the idea that people could have been better off had they invested their tax money in stocks

This assumes SS is an investment program. It isn't. It's an insurance program. See how they did that trick?

[Indium Flappers]

What say ye fair forum-goers to this article from the Independent Review?

Horrible.

Thank you.

Do today’s retirees understand that they would have a pension two, three, or more times larger than their Social Security pension if they had been allowed to invest their FICA taxes in stocks?

Bush ran on privatizing SS. Then his DOW tanked from 14k to 6.6k. Stocks are fun and I own several, but they are risky. SS isn't.

You don't address their claim. Is it true that "today’s retirees ... would have a pension two, three, or more times larger than their Social Security pension if they had been allowed to invest their FICA taxes in stocks"?

Despite Social Security’s monumental impact on the lives of ordinary Americans, it is probably the most poorly understood government program.

And these guys aren't helping with their idiotic misinformation. Speaking of bad sources, Mises is simply terrible, horrible. Be very skeptical.

So I intend. In that vein, I would be tickled azule to see any peer-reviewed literature you can provide as a refutation.

Also, I notice you don't mention Forbes, which I also linked to. Do you consider them to be a good source?

They make the common claim that Social Security is a Ponzi Scheme,...

Revealing in spades they don't know what they are talking about. Let's smack this one now (then I'm off to bed). SSA has a very nice explanation of exactly why SS is not a Ponzi scheme, check it out:

http://www.ssa.gov/history/ponzi.htm

Excerpt:
"There is no unsustainable progression driving the mechanism of a pay-as-you-go pension system, and so it is not a pyramid or Ponzi scheme.
If the demographics of the population were stable, then a pay-as-you-go system would not have demographically-driven financing ups and downs, and no thoughtful person would be tempted to compare it to a Ponzi arrangement. However, since population demographics tend to rise and fall, the balance in pay-as-you-go systems tends to rise and fall as well. This vulnerability to demographic ups and downs is one of the problems with pay-as-you-go financing. But this problem has nothing to do with Ponzi schemes or any other fraudulent form of financing; it is simply the nature of pay-as-you-go systems." --ibid

Shoot, I see that link doesn't work. I'll find the article tomorrow, or you can snoop around. This politifact article gives a nice summary. Also this article. I guess the SSA article is toast.

Thank you for the articles. Let me run through them and provide some thoughts:

Ezra Klein's article in the Washington Post:

So, Ponzi schemes. The best way to understand this question is to think about what the word “Ponzi scheme”actually refers to.

Sounds good.

In the 1920s, Charles Ponzi thought he had figured out a way to game an inconsistency between the Italian and American postal systems. He hadn’t. But rather than return his investor’s money, he told them his scheme was working, and used his salesmanship to recruit other investors. He used that money to pay back his first investors, and then flaunted his success -- and the testimonials of his happy investors -- to rope in more suckers. He used their money to pay back the second set of investors, and so on. Eventually, he couldn’t find enough new investors to pay back the swollen ranks of old investors and the scheme fell apart.

In other words: A Ponzi scheme is generally a system in which investors think they’re investing in something real but are instead being used to pay one another back. Eventually, the scheme runs out of new investors and collapses.

Matches what I've read elsewhere.

Here’s how the Social Security Administration -- which, somewhat touchingly, has a whole web page explaining why its not a Ponzi scheme -- describes Social Security: “It would be most accurate to describe Social Security as a transfer payment--transferring income from the generation of workers to the generation of retirees--with the promise that when current workers retire, there will be another generation of workers behind them who will be the source of their Social Security retirement payments.”

Seems quite accurate, and again appears to match what I've read elsewhere.

The superficial similarity to a Ponzi scheme is that different sets of investors are relying on future investors, or at least future growth, to get paid back. But that defines a Ponzi scheme so broadly as to make the term meaningless. In that definition, any intergenerational transfer system is a Ponzi scheme.

They appear to be rather intelligent. Indeed, in that definition any system in which former investors are relying on the payments of future investors would certainly quack like a Ponzi scheme.

What makes a Ponzi scheme a Ponzi scheme is that it’s a giant fraud. People think they’re investing in postal stamps. Their money is actually being invested in nothing. In Social Security, conversely, it’s perfectly clear what is going on. Every year, Social Security’s actuaries release an insanely detailed report on the system’s finances, its balance of payments, the potential problems it could face, and so on. You can read their report here. In a Ponzi scheme, the finances are a secret, and that’s central to the enterprise. In Social Security, they are, as a matter of law, public.

This is an excellent point. In speaking with retirees, it has seemed to me that they tend to be largely ignorant of how the system actually works, but perhaps that is simply from watching too much Fox News. Perhaps we simply need better education of how the system works. Far be it from me to suggest that our benign government simply doesn't care to make sure people know how it works and is content to leave the responsibility to them.

After all, if you sign a contract, it's completely your responsibility to read it and understand it, right? The fact that you have no idea what you're involved in is no indication that it's a scam.

Indeed, Social Security has a much more obvious financing structure than, well, almost anything else in the government. Consider how the Pentagon gets funded. It has no dedicated funding of its own. No one knows exactly how it will be paid for, or at what level, 20 years from now. Instead, every year, there’s a budget. Every year -- at least recently -- that budget calls for more spending than the government is taking in in taxes. So we just borrow the extra money.

If "Social Security has a much more obvious financing structure than, well, almost anything else in the government", and if, as has been my experience, people don't tend to understand Social Security's financing structure, then I guess this may be a good indication of how some of the less-than-savory qualities of our government have arisen.

Social Security, by contrast, has its own dedicated funding source. It is currently running surpluses, though it won’t be doing so for very much longer. Those surpluses are invested in U.S. Treasuries, which are widely considered the world’s safest investment. As I’ll explain in a moment, it needs adjustments to remain actuarially sound in the future. But compared to almost everything else in the federal government, its path to financial stability is clear.

I would appreciate some demonstration of the claim that U.S. Treasuries are "widely considered the world’s safest investment." For a wee bit of demonstration in the opposite direction, I would cite articles like so, such, and thus. I'm not saying I haven't seen them claimed to be safe, (for Americans), I have, especially from places like the Washington Post, which is the source you use here. I'm just saying I'm not sure it's as indisputable as Klein implies.

The other characteristic of Ponzi schemes is that they tend to require huge increases in the number of participants in order to stay afloat. As the Social Security Administration explains, “to pay a 100% profit to the first 1,000 investors you need the money from 1,000 new investors. Now there are 2000 ‘investors’ in the scheme, and in the second round of payouts to pay the same return to these 2,000 investors in the next round, you need the money from 2,000 new investors--bringing the number of participants to 4,000. And to pay these 4,000, you will end up with 8,000 ‘investors,’ then 16,000--and so on.” This type of geometric explosion looks like a pyramid, which is why Ponzi schemes are often called “pyramid schemes.”

Accurate.

Social Security doesn’t look like a pyramid. Quite the opposite, actually. Its current funding shortfall is a product of the baby boomers retiring and birth rates declining. That means more beneficiaries and fewer workers than there were when, say, the boomers were working and their parents were retiring. So Social Security has a funding gap equal to 0.7 percent of GDP over the next 75 years. We could wipe that gap out by lifting the payroll tax cap (right now, payroll taxes only apply to the first $107,000 of income) or by adjusting benefits downwards. Once it’s done, however, it’s done. Stable. Again, quite unlike a Ponzi scheme.

So, the fact that the SS program promised retirees a certain amount of money in benefits and has the ability, which it may likely need to use, to pay retirees less in benefits then they were promised, is a demonstration that they are not engaging in fraud?

Or is the point simply that such a promise was never made to begin with? Retirees seem to have the perception that such a promise was made.

That essential stability is, perhaps, the most obvious refutation of the Ponzi scheme argument. The Social Security Administration puts it well on its Web site. “The first modern social insurance program began in Germany in 1889 and has been in continuous operation for more than 100 years. The American Social Security system has been in continuous successful operation since 1935. Charles Ponzi’s scheme lasted barely 200 days.”

I confess I have not studied the social insurance program in Germany. Perhaps it is immensely superior to our own, or at least to other alternatives the Germans could possibly use. However, the article I cited makes me doubt the success and preferability of the American Social Security system. I am, obviously, open to further evidence on the matter, seeing as I am participating in this discussion, but the claim alone is hardly sufficient to sate my empiricist appetite.

Politifact article:

This article appears to make the same basic arguments as the other you cited. Namely: a) SS is not a fraud because the pay-as-you-go nature of the system is public knowledge, and b) SS is not a pyramid scheme because, unlike Ponzi's scheme, it is sustainable.

I won't go through the whole article like I did with the other. But in regard to these points:

a) This is, again, an excellent point, but, also again, in my experience the public largely does not appear to possess this public knowledge. The impression I have gotten is that retirees believe that the money they themselves paid into SS was supposed to be held for them to pay for their retirement, and then the government spent it all and switched to a pay-as-you-go system to fund it afterwords. Indeed, until I read the article from the Independent Review, I had a somewhat similar idea of the system myself, and did not fully understand that SS had been a pay-as-you-go system from the get-go.

Here are some results from a set of surveys conducted by the Social Security Administration, in partnership with Gallup, that give some indication of the level of knowledge people had of the system around 2000. If someone can find more recent results or any alternative studies that have been conducted, I'd be quite grateful.

The overall knowledge level of the adult population did not increase significantly between PUMS-I and PUMS-II. The results of PUMS-II indicate that 56.6% of the public is knowledgeable about Social Security programs as compared to 54.9% in PUMS-I.

In addition, 24.1% of the public is "close to knowledgeable" (e.g., responded correctly to 11 or 12 of the 19 knowledge indicators) in PUMS-II.

Having a little over half the public be "knowledgable about Social Security programs" seems low for the work they've put into education. The page doesn't offer up any data on how many believe SS to be based on trust-funds vs. transfer payments, (I haven't yet been able to find statistics on this, again, if anyone knows of any, I'd be much obliged), but it does offer these numbers:

The following knowledge indicators received scores in PUMS-II that are significantly lower than the corresponding scores received in PUMS-I.

· Use of Social Security Taxes. Knowledge of the use of Social Security taxes fell from 81.1% to 78.0%.

· Fewer Workers, Future. Knowledge about the insufficient number of workers to finance future benefits fell from 60.7% to 57.4%.

and these:

Another significant change between PUMS-I and PUMS-II is an increase in the level of confidence that Social Security benefits will be available for the public when they retire (from 38% to 44%).

Meaning a decrease in "Knowledge of the use of Social Security taxes" and "Knowledge about the insufficient number of workers to finance future benefits" is correlated with "an increase in the level of confidence that Social Security benefits will be available for the public when they retire". I suppose this isn't too surprising, but it does give one pause.

So now the question becomes, does the government have a responsibility to make clear to the public the nature of the SS system? If the answer is yes, then they appear to have shirked this responsibility. Or at least underperformed. If the answer is no, then I will need to devise some new questions for the contingency, because I'd find it surprising to think that someone who believes it to be the government's responsibility to take care of retirees would not think it to be the government's responsibility to accurately inform retirees of how SS works and how they're being taken care of.

b) I think the article I cited addresses this:

A retirement system that finances retirees’ benefits by taxing younger workers’ earnings (as Social Security does) is said to be run on a pay-as-you-go (PAYGO) basis. Because no fund is being accumulated on behalf of the taxpayers, this arrangement is also sometimes called an unfunded system.

A PAYGO system bears an eerie resemblance to a Ponzi scheme (also known as a pyramid scheme), named after Charles Ponzi, who apparently first utilized this scheme to swindle investors. In 1920, Ponzi began to borrow money from investors, promising them a return of 50 percent after only forty-five days. (On an annual compound basis, this is comparable to a return of 2,500 percent!) He paid off the early investors by using the funds provided by later investors (as Social Security paid off early retirees by taxing later retirees—that is, younger workers); he did nothing with the funds to generate such fantastic returns (as Social Security does not invest the taxes paid by workers). Like most pyramid schemes, Ponzi’s system collapsed, leaving the later investors with nothing because their funds had been used to pay off the earlier investors. The entire swindle lasted less than a year. Ponzi pleaded guilty to mail fraud and spent four years in jail. Since that time, pyramid schemes have been illegal.

That is, unless they are run by the federal government, as with Social Security. But differences between privately operated Ponzi schemes and publicly operated PAYGO retirement programs enable Social Security to be a viable system for providing retirement benefits. Notably, the government can force current and future workers to “invest” (by collecting taxes from them), so that retirees can always be assured of incoming funds supplied by younger workers.

Sure, it's sustainable, in a sense. It's sustainable because workers can't opt-out of paying into the system, whether they understand how it works or not. I'd speculate that I could sustain all manner of business practices if I could pay for said practices by taxing people. But is it sustainable in the sense that I'm going to get back about the same value as I paid into the system in taxes when I retire? Are the benefits of the system sustainable? And more importantly, how do the benefits provided by SS compare to alternatives?

SSA article:

I went and found an archived version of the ssa article you cited. Here you go.

This one does a much better job than the other two articles you offered as substitute, in my opinion. It fairly clearly differentiates between pyramid schemes and transfer-payment programs, arguing that there are substantial structural differences between the two and that SS is an example of the latter. So, I'll concede that SS is a pay-as-you-go system rather than a pyramid scheme, and that, while I still think it shares qualities of a Ponzi scheme, (the qualities specified in the previous block-quote), it is not equivalent.

The ssa article also attempts to address the point that early recipients gained more in benefits than later ones, one of the major points made by the article I cited, by saying this was in the "spirit of public generosity" and that "In the context of the early years of the Social Security program it was an expression of a public policy which held that workers already old should not be turned away penniless." This seems to imply that the "public" was widely made aware of the nature of the system, that they clearly understood it, and that they widely supported it.

This leaves us with the questions of whether the system is sustainable, whether it is preferable to alternatives, and whether it is true that the government did a good job of educating the public in regard to how the system worked. On this note, the ssa article continues:

Social Security is and always has been either a "pay-as-you-go" system or one that was partially advance-funded. Its structure, logic, and mode of operation have nothing in common with Ponzi schemes or chain letters or pyramid schemes.

This leaves me with the impression that my mistake in this whole matter has been the assumption that the administration ever made the claim that contributions from workers and employers would be collected by the federal government and then held in trust for payment of benefits to these workers and their families. After all, here is a fine page now no longer available on a government website explaining that SS has always been a pay-as-you-go system, and not a trust at all.

So, I went and looked up a video I had thought I'd remembered watching at some point. The title of the film is Your Social Security, and it was produced by the Federal Security Agency sometime in the 1940s, before they became the U.S. Department of Health, Education, and Welfare on April 11, 1953. You can watch the full video at the Internet Archive, or download it from the same place if your prefer.

From about 4:47 to 5:15, the narrator of the video states that:

Contributions, based on your earnings, made regularly by you and millions of your fellow workers, plus equal contributions made by your employers, pay for the program. These contributions are collected by the federal government. The government then holds them in trust for payment of benefits to you and your family.

I see the Social Security Administration has done a lovely job of countering all the "idiotic misinformation" from "right wing nuts" such as silly little claims that payments into SS are not held in trust by the government and that the government has engaged in fraudulent behavior by miseducating the public as to the nature of the system.

but they also give data indicating a rather bleak future for social security recipients

Of course, because these right wing nuts hate SS and always have. And they like to lie about it too.

They provide data because of hatred. Yes of course. Certainly science and truth have nothing to do with it.

SS is solid, and with small tweaks, solid as far as the eye can see.

I am thrilled to be seeing your future demonstration of this. I assume that by "small tweaks" you mean higher taxes, lower benefits, or some combination thereof?

Are they correct or no?

No. Not even close. But SS can get rather complex, so they have lots of room to cause confusion. Perhaps GW Bush had the most clear explanation on the conservative side:

"Because the — all which is on the table begins to address the big cost drivers. For example, how benefits are calculate, for example, is on the table; whether or not benefits rise based upon wage increases or price increases. There's a series of parts of the formula that are being considered. And when you couple that, those different cost drivers, affecting those — changing those with personal accounts, the idea is to get what has been promised more likely to be — or closer delivered to what has been promised. Does that make any sense to you? It's kind of muddled. Look, there's a series of things that cause the — like, for example, benefits are calculated based upon the increase of wages, as opposed to the increase of prices. Some have suggested that we calculate — the benefits will rise based upon inflation, as opposed to wage increases. There is a reform that would help solve the red if that were put into effect. In other words, how fast benefits grow, how fast the promised benefits grow, if those — if that growth is affected, it will help on the red."
—George W. Bush, explaining his plan to save Social Security, Tampa, Fla., Feb. 4, 2005

Just kidding.

I'm not a conservative, I'm a market anarchist, and I'm more interested in scientific research than I am in quotes from GW Bush. But thank you. I admire someone with a sense of humor.

the idea that people could have been better off had they invested their tax money in stocks

This assumes SS is an investment program. It isn't. It's an insurance program. See how they did that trick?

On the contrary, they claim that investment programs provide better results than SS. Not that SS is an investment program, but that investment programs are superior. You take their claim that X is better than Y and equate it with the claim that Y is an example of X. I am curious as to the methodology you employed in the invention of such an intriguing interpretation.

Their claim that X is better than Y may, of course, be completely false. But a clear understanding of what claim they are making, as opposed to a rather crippled strawman, would appear to be a healthy first step in refuting their claim.

No?

[Dardedar]

Indium, your post is over 3,800 words and fills nine pages in a Word doc. I've had a long day and adjusted 1,125 tuning pins. And I'll tell you right up front, I have a bit of an allergy to anarchist stuff. It's kind of painful to me. I've had a bad experience with all of the ones I've interacted with but you seem a gentle soul about it so perhaps we can get along. I'm just being honest in saying this. That said, I'll answer your questions and respond to your main points.

Do today’s retirees understand that they would have a pension two, three, or more times larger than their Social Security pension if they had been allowed to invest their FICA taxes in stocks?

Bush ran on privatizing SS. Then his DOW tanked from 14k to 6.6k. Stocks are fun and I own several, but they are risky. SS isn't.

You don't address their claim. Is it true that "today’s retirees ... would have a pension two, three, or more times larger than their Social Security pension if they had been allowed to invest their FICA taxes in stocks"?

I did address their claim but I was too subtle. I don't accept their set up, their dichotomy. It's bogus. SS isn't an investment program, that's not its function or purpose. It's societies way of having citizens fund what we have come to consider a societal need, that of, providing for widows, orphans and... well, let me cite an old blurb I had on this:

"Who Gets Social Security?
About 50 million people collect Social Security benefits each month, and they account for about one in six people in the United States. In about one household in four, someone is receiving Social Security benefits.
About 32 million retired workers receive benefits and another 3 million individuals receive benefits as spouses or children of retired workers. A total of 6.5 million people receive benefits as survivors of deceased workers, and these beneficiaries include 4.2 million aged widows and widowers and 1.9 million children. Another 7.2 million people receive benefits as disabled workers, and 1.8 million people receive benefits as the child or spouse of a disabled worker. A total of 3.1 million children under age 18 receive Social Security and another 0.8 million adults who have been disabled since childhood get benefits as dependents of a retired, disabled or deceased parent.
Total Beneficiaries: 50,417,000
June 30, 2008"

So again, if you put money in the stock market, you will, on average, unless you get wiped out in what have been multiple crashes, typically get more back than what SS pays. But SS is not intended as an investment program. So to compare it to one is bogus. Completely. If I took the money I have to spend on car insurance and invested it, I would have a better return too, that is, if I didn't have an accident and rack up $300k in damages. But the purpose of car insurance is not to be an investment program but rather an insurance program. So this comparison is bogus too.

For whatever reason a great portion of society does not plan for their retirement. That's just he way it is. Perhaps the fact that about half of them, last I checked, live from paycheck to paycheck has something to do with it. So rather as we did in the past, than let a great portion of society live in utter destitution because they are old, or disabled, or widowed/orphaned, ill etc, we have decided, as a society, much to the chagrin of far right market worshipers, that we will require people to pay up front for this societal cost. It's not an investment program intended to provide wonderful market returns. That's not it's purpose. We have a market for that which anyone can choose to play with, and even with tax deferred dollars. We also have Las Vegas and they are not as dissimilar as one might think (I've been playing with stocks for over 15 years and I don't have as much in my portfolio as I have put in. Case in point).

The purpose of SS is to provide a rock solid, self funded bottom floor through which we will not allow people to fall below. And it has been a tremendous, and highly efficient, success.

And these guys [Mises] aren't helping with their idiotic misinformation. Speaking of bad sources, Mises is simply terrible, horrible. Be very skeptical.

I would be tickled azule to see any peer-reviewed literature you can provide as a refutation.

Refutation of what? Be specific. (And please don't send me to read some Mises stuff, that's too painful and I don't deserve such treatment).

I notice you don't mention Forbes, which I also linked to. Do you consider them to be a good source?

I don't care so much about sources. I didn't look at the link. That said, realize Forbes used to a name that meant something, then they sold out and are "whores for the clicks." Anyone can be a contributor so an article can be good or bad. There is no Forbes discernment to distinguish between the two. It's basically a bathroom wall. Far worse than wiki. That something is on the "Forbes" site doesn't mean anything (but it used to). They are riding their name into the ground.
I just looked at the article and it's somebody doing the old SS = Ponzi nonsense. That's really too stupid for words. I can't take a person seriously who falls for that entirely bogus canard (it was started by Friedman in the 1950's as I remember and he really was smart enough to know better). It's not a serious claim.

[snipping...]

They appear to be rather intelligent. Indeed, in that definition any system in which former investors are relying on the payments of future investors would certainly quack like a Ponzi scheme.

Bingo.

Perhaps we simply need better education of how the system works.

Here's how bad the ignorance is:
"Finally, Cornell University’s Suzanne Mettler points out that many beneficiaries of government programs seem confused about their own place in the system. She tells us that 44 percent of Social Security recipients, 43 percent of those receiving unemployment benefits, and 40 percent of those on Medicare say that they “have not used a government program.”
Link

I would appreciate some demonstration of the claim that U.S. Treasuries are "widely considered the world’s safest investment."

I think that's in the context of risk when the world is in economic troubles. Here's the evidence:

No Fire Sale Coming
A sovereign debt downgrade might equal disaster for almost any other country, prompting investors to sell their government bonds en masse.
But the United States is the exception.
Why? Because foreign buyers simply don’t have any “alternatives to the Treasury market in terms of depth and liquidity,” as Vassili Serebriakov, Currency Strategist at Wells Fargo says.
Case in point: The United States has just more than $14 trillion in bonds outstanding. Meanwhile, the next biggest issuers of AAA-debt have less than $2 trillion.
So foreign buyers looking to park literally hundreds of billions of dollars in relatively safe, liquid assets have no other choice. It’s U.S. Treasuries or nothing else. Period.
LINK

Case in point. After the 2008 crash, investors were willing to pay interest to park their money and receive the relative safety of US treasuries. See here.

For a wee bit of demonstration in the opposite direction, I would cite articles like...

I don't have time to read those. This latest recession showed where the investment money went for security, and it was the US.

So, the fact that the SS program promised retirees a certain amount of money in benefits and has the ability, which it may likely need to use, to pay retirees less in benefits then they were promised, is a demonstration that they are not engaging in fraud?

The quote you are referring to, doesn't say anything like that. So, no fraud. Zip.

Or is the point simply that such a promise was never made to begin with?

What promise? Society created SS and it may, through its elected representatives adjust it over time in order to compensate for demographics and a host of other things. That's life in a democracy, that's reality, that's not fraud.

...until I read the article from the Independent Review, I had a somewhat similar idea of the system myself, and did not fully understand that SS had been a pay-as-you-go system from the get-go.

If I may speak plainly, I think some of the problem is you have been reading some wingnut sources and they have been misinforming you. The far right has spilled an ocean of ink lying about SS for three quarters of a century. They loath it. I find their misinformation about it, disgusting.

Having a little over half the public be "knowledgable about Social Security programs" seems low for the work they've put into education.

About half the population believes the Adam & Eve story and think Noah had a boat. I am not some much interested in what the profoundly ignorant American public happens to manage to believe. It really means nothing.

...does the government have a responsibility to make clear to the public the nature of the SS system?

I can't get interested in that question.

It's sustainable because workers can't opt-out of paying into the system, whether they understand how it works or not.

History has shown it's sustainable. Germany's example shows it's sustainable. Basic math shows it's sustainable. The claim it isn't sustainable is ludicrous and makes no sense. It's a common claim but one based upon either gross ignorance or dishonest politics (we can't afford to tax more for SS because we have to pay for these wars!).

But is it sustainable in the sense that I'm going to get back about the same value as I paid into the system in taxes when I retire?

That's not it's purpose. Some will get more, some will get less. That's how an insurance pool works. So if you are going to have an insurance pool, you want it to run efficiently, and with SS running with an overhead of less than 1% (as even the libertarians at CATO admit), it's exceedingly efficient at fulfilling it's purpose (already covered above).

Are the benefits of the system sustainable?

Absolutely. With well understood needs for tweaks and adjustments along the way. Simply raising the current cap at $108k up to $200k (as I remember), makes it sustainable with current benefits for 75 years. That's a fiscal forever as far as projections go.

And more importantly, how do the benefits provided by SS compare to alternatives?

Privatizing always costs more and increases risks. That's why Bush got spanked when he touched the third rail. As one republican famously put it long ago:

"Should any political party attempt to abolish social security,
unemployment insurance, and eliminate labor laws and farm programs, you
would not hear of that party again in our political history. There is a
tiny splinter group, of course, that believes you can do these things.
Among them are [a] few other Texas oil millionaires, and an occasional
politician or business man from other areas. Their number is negligible
and they are stupid." - President Dwight D. Eisenhower, 11/8/54

I'll concede that SS is a pay-as-you-go system rather than a pyramid scheme, and that, while I still think it shares qualities of a Ponzi scheme, (the qualities specified in the previous block-quote), it is not equivalent.

Excellent. Now consider, think, about the sources that peddled this canard in the first place. And how common this canard is in many circles.

After all, here is a fine page now no longer available on a government website explaining that SS has always been a pay-as-you-go system, and not a trust at all.

It really is a stupid claim I think. Maybe they thought it wasn't worth addressing any more. Maybe I'll grab it and put it on this forum. That waybackmachine has been trying to load for over a minute and it still hasn't loaded. (that tab crashed. another one finally loaded)

...the narrator of the video states that:

Contributions, based on your earnings, made regularly by you and millions of your fellow workers, plus equal contributions made by your employers, pay for the program. These contributions are collected by the federal government. The government then holds them in trust for payment of benefits to you and your family.

I see the Social Security Administration has done a lovely job of countering all the "idiotic misinformation" from "right wing nuts" such as silly little claims that payments into SS are not held in trust by the government and that the government has engaged in fraudulent behavior by miseducating the public as to the nature of the system.

It is "idiotic misinformation" by "rightwing nuts." The SS trust funds have just as much reality as the fiat money in your pocket. If you don't believe in that money, then I'll trade it for some copier paper, straight across. Our currency is a "trust" and so is "SS." It is a societal trust. It is an example of socialism. And it works fantastically.

DAR
"SS is solid, and with small tweaks, solid as far as the eye can see."

I am thrilled to be seeing your future demonstration of this.

You'll just have to look that up for yourself. It's pretty straightforward math, contrary to the ludicrous claims of the far right. Here's an old blurb I had from a debate years ago:

***
Conservatives love to tell whoppers about SS.

"Thanks to hikes in the Social Security payroll tax in the 1980s designed to create a surplus to handle the crunch of baby-boomer retirements, the program's trust fund is projected to grow steadily for nearly 20 more years — until 2027.
After that, officials estimate there will be sufficient money to pay 100 percent of benefits until 2041, when the surplus is expected to be exhausted. From that year on, payroll tax revenue alone should be able to meet 78 percent of the program's obligations — even if no changes are made." http://www.ohio.com/news/american_dream/27325314.html

That was a little optimistic since it was before the Bush train wreck. So the numbers are a little different now:
"The concepts of solvency, sustainability, and budget impact are common in discussions of Social Security, but are not well understood. Currently, the Social Security Board of Trustees projects program cost to rise by 2035 so that taxes will be enough to pay for only 75 percent of scheduled benefits. This increase in cost results from population aging, not because we are living longer, but because birth rates dropped from three to two children per woman. Importantly, this shortfall is basically stable after 2035; adjustments to taxes or benefits that offset the effects of the lower birth rate may restore solvency for the Social Security program on a sustainable basis for the foreseeable future." http://www.ssa.gov/policy/docs/ssb/v70n3/v70n3p111.html
New link for that: https://www.usatrace.com/ponzi/

A little adjusting, as necessary for demographics etc, and SS is fine forever. Start by taxing the rich. Cut out their tax free ride on income over $108k. Problem solved.
***

Standard stuff. SS is as solid as the US. Which as the world turns, with about $180 trillion in assets last I checked, fairly solid.

I assume that by "small tweaks" you mean... higher taxes, lower benefits, or some combination thereof[/url]?

Precisely. Taxes are too low, especially on the rich.

I'm not a conservative, I'm a market anarchist,...

I consider that conservatism gone to seed.

...they claim that investment programs provide better results than SS.

That's their bogus dichotomy that necessarily rides upon a very purposeful distortion of SS's purpose. Vegas provides better results than SS, if your lucky. SS is not an investment program, it is an insurance program. This is detailed very clearly in it's title.

Not that SS is an investment program, but that investment programs are superior.

Except when they aren't and you lose all or most of your money. See history. Invest away, I do. I buy houses and play the market a bit. Society has decided that rather than have a great portion of people, typically the working poor, suffer in squalor and destitution due to (all the reasons people get SS), we are going to require people self-fund an insurance program for the betterment of society and provide a floor under which people can't fall. This has nothing to do with bogus comparisons to investment programs. Stop peddling this bogus rightwing canard.

...a clear understanding of what claim they are making, as opposed to a rather crippled strawman, would appear to be a healthy first step in refuting their claim.
No?

I think I've given a good shot at struggling to take a claim seriously that I find tedious and difficult to take seriously. The far right has loathed SS from the beginning. They have systematically lied about it from the beginning as it seems you may now be seeing. Their goal has been to destroy it, from the beginning. I understand their attempts to privatize it as an attempt to get their hands on the trillions that now flow through it with 99% efficiency, in order to siphon a good chunk of it off to the rich. This point is made nicely: here.

D.
----------------
"I'm going to spend a lot of time on Social Security. I enjoy it. I enjoy taking on the issue. I guess, it's the Mother in me." —George W. Bush, Washington D.C., April 14, 2005

[David Franks]

You don't address their claim. Is it true that "today’s retirees ... would have a pension two, three, or more times larger than their Social Security pension if they had been allowed to invest their FICA taxes in stocks"?

It is such a gross generalization-- so dependent upon the span of years in which one invests and one's investment strategy-- that one would have to be either stupid or dishonest to offer it as a justification for privatizing Social Security. For example, my household retirement investments lost about 30% of their value in Bush's grand recession-- and we were lucky. Social Security did not lose value. Most financial planners consider Social Security to be an important part of one's savings/insurance/investments because most people will not invest conservatively at the recommended rate-- percentage of investment in low-yield products equals your age.

If you want to see how well investment in the stock market works for retirement, look at the ongoing situation with public employee pension funds.

If you want to see how non-compulsory retirement funding works, look at the numbers of people who try to live on Social Security, even when they've been told for their entire working lives that they can't live on Social Security. Americans spend a lot of money needlessly, even when they know they're going to retire-- and the "bite" of Social Security doesn't keep them from spending money needlessly.

If you wish to suggest that compulsory retirement funding be turned to stock market investment, I will note that this will either increase the size of government tremendously or provide an unneeded teat to a business sector that is already robbing us blind. Plus, either way, it will demand even more attention from a public that can't even pay the minimal attention required to understand Social Security.

So, the fact that the SS program promised retirees a certain amount of money in benefits and has the ability, which it may likely need to use, to pay retirees less in benefits then they were promised, is a demonstration that they are not engaging in fraud?

Or is the point simply that such a promise was never made to begin with? Retirees seem to have the perception that such a promise was made.

While it is true that many people feel that they have been promised a certain level of benefits at a certain age, and that some politicians have said as much from time to time, unrealistic expectations and lies don't make Social Security a Ponzi scheme. Much of the outcry about Social Security benefits is not so much related to perceived promises as to the perception that Congress "raids" Social Security instead of raising its own damned income, dammit.

As Darrel pointed out, there is nothing mysterious about Social Security. Its dependence on the ratio of workers to retirees has always been known; its creation and alterations over time have been subjected to intense public scrutiny. A Ponzi scheme is a particular mechanism by which promised return on investment is somehow made to appear-- "somehow" being mysteriously, and only for a while. Part of the definition of a Ponzi scheme is the revenue mechanism, but secrecy and fraud are part of the definition as well. The very fact that projections show that Social Security can run out of money and when that could happen tends to prove that it is not a Ponzi scheme. The source for ongoing income is known to participants, and Social Security can work even when the worker/retiree ratio would kill a Ponzi scheme.

[Indium Flappers]

Indium, your post is over 3,800 words and fills nine pages in a Word doc.

Mm.

Yeah, sorry about that.

I'll try to be more succinct going forward.

I've had a long day and adjusted 1,125 tuning pins. And I'll tell you right up front, I have a bit of an allergy to anarchist stuff. It's kind of painful to me. I've had a bad experience with all of the ones I've interacted with but you seem a gentle soul about it so perhaps we can get along.

Why thank you.

Like, genuine thank you, actually, that's a warmer welcome than I think I was expecting.

Yes, I've read some of the discussions you've had with anarchists on this forum in the past. Don't worry, I'm not going to claim that Somalia is a pleasant place to live or anything like that.

I'm just being honest in saying this. That said, I'll answer your questions and respond to your main points.

Much appreciated. I'd kind of forgotten how long-winded I get in discussions like this.

I did address their claim but I was too subtle. I don't accept their set up, their dichotomy. It's bogus. SS isn't an investment program, that's not its function or purpose. It's societies way of having citizens fund what we have come to consider a societal need, that of, providing for widows, orphans ... So again, if you put money in the stock market, you will, on average, unless you get wiped out in what have been multiple crashes, typically get more back than what SS pays. But SS is not intended as an investment program. So to compare it to one is bogus. Completely.

Well ok, I respectfully disagree. I don't see why a program designed to provide insurance can't use investments to do so. People have a certain amount of money to spend, and different ways to spend it, and "society" as you say has decided that in order to provide for their retirement their money ought to go into the social security program. But that's not the only way one could provide for one's own retirement.

Anywho, I get your point I think.

For whatever reason a great portion of society does not plan for their retirement. That's just he way it is. Perhaps the fact that about half of them, last I checked, live from paycheck to paycheck has something to do with it. So rather as we did in the past, than let a great portion of society live in utter destitution because they are old, or disabled, or widowed/orphaned, ill etc, we have decided, as a society, much to the chagrin of far right market worshipers, that we will require people to pay up front for this societal cost. ... The purpose of SS is to provide a rock solid, self funded bottom floor through which we will not allow people to fall below. And it has been a tremendous, and highly efficient, success.

Um, ok. I'm completely and utterly unconvinced of this. We have a fair number of poor/needy people in our society, yes, and used to have in the past, yes, but I'm not convinced that SS provides a better solution than other alternatives, or that it has provided a great improvement to our society, or that people failed as utterly as you say in providing for the old, disabled, widowed/orphaned, ill, poor, unemployed, etc.

You reject the comparison with private investments. How about Mutual Aid Societies?

Refutation of what? Be specific. (And please don't send me to read some Mises stuff, that's too painful and I don't deserve such treatment).

I meant this article from the Independent Review, but it's a 24 page paper and you've already conceded to the main empirical claim that they made, while rejecting the validity of their comparison in the first place, so don't bother I guess?

I don't care so much about sources. I didn't look at the link. That said, realize Forbes used to a name that meant something, then they sold out and are "whores for the clicks." Anyone can be a contributor so an article can be good or bad. There is no Forbes discernment to distinguish between the two. It's basically a bathroom wall. Far worse than wiki. That something is on the "Forbes" site doesn't mean anything (but it used to). They are riding their name into the ground.

Ah, I didn't know that about the Forbes website. Thanks.

Here's how bad the ignorance is:
"Finally, Cornell University’s Suzanne Mettler points out that many beneficiaries of government programs seem confused about their own place in the system. She tells us that 44 percent of Social Security recipients, 43 percent of those receiving unemployment benefits, and 40 percent of those on Medicare say that they “have not used a government program.”
Link

I guess I think of Paul Krugman similarly to how you think of Mises, but yes, sad numbers.

...I think that's in the context of risk when the world is in economic troubles. Here's the evidence...

Thank you! Shall read soon.

...until I read the article from the Independent Review, I had a somewhat similar idea of the system myself, and did not fully understand that SS had been a pay-as-you-go system from the get-go.

If I may speak plainly, I think some of the problem is you have been reading some wingnut sources and they have been misinforming you. The far right has spilled an ocean of ink lying about SS for three quarters of a century. They loath it. I find their misinformation about it, disgusting.

I'm willing to read whatever sources you send me to to read. In my experience words like "wingnut" tend to be subjectively applied to whatever a particular person strongly disagrees with.

I'm not surprised that you think that though.

Having a little over half the public be "knowledgable about Social Security programs" seems low for the work they've put into education.

About half the population believes the Adam & Eve story and think Noah had a boat. I am not some much interested in what the profoundly ignorant American public happens to manage to believe. It really means nothing.

What it means is that if the "society" that, as you say, has decided to adopt SS wasn't "profoundly ignorant", it may have made a different decision.

It's sustainable because workers can't opt-out of paying into the system, whether they understand how it works or not.

History has shown it's sustainable. Germany's example shows it's sustainable. Basic math shows it's sustainable. The claim it isn't sustainable is ludicrous and makes no sense. It's a common claim but one based upon either gross ignorance or dishonest politics (we can't afford to tax more for SS because we have to pay for these wars!).

I find this amusing honestly, because you sound like a marxist I know of. (That's a compliment, he's one of my favorite game designers.) The basic math is that a far lower number of workers are supporting each beneficiary than in the past, and it places a strain on the system. You can take the same talk about "basic math" and switch the ideologies out and put what you say in a Heinlein book.

But is it sustainable in the sense that I'm going to get back about the same value as I paid into the system in taxes when I retire?

That's not it's purpose. Some will get more, some will get less. That's how an insurance pool works.

An insurance pool and a trust are different, no?

So if you are going to have an insurance pool, you want it to run efficiently, and with SS running with an overhead of less than 1% (as even the libertarians at CATO admit), it's exceedingly efficient at fulfilling it's purpose (already covered above).

Mutual Aid Societies seem to be able to provide efficient insurance programs, from what I've read, but I haven't done as much research into them.

Are the benefits of the system sustainable?

Absolutely. With well understood needs for tweaks and adjustments along the way. Simply raising the current cap at $108k up to $200k (as I remember), makes it sustainable with current benefits for 75 years. That's a fiscal forever as far as projections go.

I shall have to investigate this later.

Privatizing always costs more and increases risks.

Actually, I honestly find it hard to believe that you actually mean this. Always? Should everything be produced publicly then? Bread? Computers? Yo-yos? You don't think there's a single example of privatization reducing costs?

...the narrator of the video states that:

Contributions, based on your earnings, made regularly by you and millions of your fellow workers, plus equal contributions made by your employers, pay for the program. These contributions are collected by the federal government. The government then holds them in trust for payment of benefits to you and your family.

I see the Social Security Administration has done a lovely job of countering all the "idiotic misinformation" from "right wing nuts" such as silly little claims that payments into SS are not held in trust by the government and that the government has engaged in fraudulent behavior by miseducating the public as to the nature of the system.

It is "idiotic misinformation" by "rightwing nuts." The SS trust funds have just as much reality as the fiat money in your pocket. If you don't believe in that money, then I'll trade it for some copier paper, straight across. Our currency is a "trust" and so is "SS." It is a societal trust. It is an example of socialism. And it works fantastically.

I think terms like "idiotic misinformation" and "rightwing nuts" are more in the rhetoric category than the logic/evidence category. A pay-as-you-go system is not a trust fund. Those are at least as dissimilar as paygo and pyramid schemes. Saying that our currency is a trust stretches the term even more. If you're going to criticize the stretching of the term "ponzi scheme" to fit social security, because it implies a particular structure, then it seems fit to do the same with trust funds which also have a particular structure.

I'm not a conservative, I'm a market anarchist,...

I consider that conservatism gone to seed.

Of course you do.

Society has decided that rather than have a great portion of people, typically the working poor, suffer in squalor and destitution due to (all the reasons people get SS), we are going to require people self-fund an insurance program for the betterment of society and provide a floor under which people can't fall.

Society, as you have pointed out, is largely ignorant, a transfer payment by definition is different from self-funding, people still seem to be able to fall quite low, and we'll leave the discussion of whether SS keeps the working poor from suffering in squalor and destitution for another day.

Though I guess I could leave this link here before moving on. I've only just started reading this one though.

...a clear understanding of what claim they are making, as opposed to a rather crippled strawman, would appear to be a healthy first step in refuting their claim.
No?

I think I've given a good shot at struggling to take a claim seriously that I find tedious and difficult to take seriously. The far right has loathed SS from the beginning. They have systematically lied about it from the beginning as it seems you may now be seeing. Their goal has been to destroy it, from the beginning. I understand their attempts to privatize it as an attempt to get their hands on the trillions that now flow through it with 99% efficiency, in order to siphon a good chunk of it off to the rich. This point is made nicely: here.

By claiming that the money paid into SS is held in trust the SSA intentionally deceived the public. They gave them an inaccurate impression of how SS works that the public would be more supportive of. The government is the liar here.

Also, I imagine that pretty much any claim I make in regard to politics will seem tedious and difficult to take seriously to you. Alas, I shall have to go where the evidence leads, whether people find me tedious to talk with or not.

Thanks for your responses!

Also, @David Franks, I was almost done with this post before seeing your post, so I didn't get to responding to you, but I'll try and respond in the morning.

[Dardedar]

I don't see why a program designed to provide insurance can't use investments to do so.

It can. My insurance premiums paid to Allstate are used for investments too. That doesn't make my car insurance an investment program, and it doesn't make my car insurance something that should fairly be compared with an investment program.
Staying with the analogy, SS payments/premiums are invested in society and our paypack has been those 50 million people (mentioned above) not living in poverty and squalor. I think that's a pretty good payback.

People have a certain amount of money to spend, and different ways to spend it, and "society" as you say has decided that in order to provide for their retirement their money ought to go into the social security program.

Exactly. And that society, was created by them.

But that's not the only way one could provide for one's own retirement.

Obviously. And most people, like me, also partake in those other ways as well. SS just provides a floor, a guard rail. And it makes the people pay for it, just like the guard rail on a highway.

I'm not convinced that SS provides a better solution than other alternatives,

What alternatives? Let's see them. Show me a country using an alternative with a superior outcomes/efficiency/results.

or that it has provided a great improvement to our society,

Then you really haven't been paying attention. Really. How old are you Indium?

Blurb:

"In the 77 years since President Franklin Roosevelt signed Social Security into law on August 14, 1935, the retirement program has been one of the nation's most successful anti-poverty programs. Before Social Security existed, about half of America's senior citizens lived in poverty. Today, less than 10 percent live in poverty.
Today, Social Security not only provides retirement security but also enables millions of people with disabilities and widows, widowers and children to live in dignity and security." Link

On what planet is that not "a great improvement to our society?"

or that people failed as utterly as you say in providing for the old, disabled, widowed/orphaned, ill, poor, unemployed, etc.

They did. How long have you been calling yourself an anarchist? Perhaps there is still time.

You reject the comparison with private investments.

Yes. Different things, different purpose.

How about Mutual Aid Societies?

I don't know much about those. Show me a country with poor/disabled/elderly/sick thriving under that system.

Refutation of what? Be specific. (And please don't send me to read some Mises stuff, that's too painful and I don't deserve such treatment).

I guess I think of Paul Krugman similarly to how you think of Mises,...

Your condition is curable. Perhaps.

Privatizing always costs more and increases risks.

Actually, I honestly find it hard to believe that you actually mean this. Always?

I say this based upon countries that have experimented with it. SS efficiency is about 1% or less. Estimates are privatization puts costs around 20-30% (very much like our health insurance system).
I am gathering that you don't know very much about this topic.

Should everything be produced publicly then? Bread? Computers?

Here we go....

You don't think there's a single example of privatization reducing costs?

I think there are lots of instances. And there are lots going the other way as well. Here are a few examples:

1) About 95% of fire stations are handled by municipal governments because it's cheaper to handle it in house rather than pay a for profit private company.

2) Same with sanitation.

3) Social Security operates with an expense of about 1%. That's incredibly efficient. Countries that have experimented with privatizing social security have found the expense goes up to as high as 20%-30%.

4) The entirely government run VA medical system operates with better outcomes, higher satisfaction and far less cost than the private for profit sector. Extensive references upon request.

5) The IRS. "The employment of private tax collectors has been, for federal unions, a particularly egregious example of the misuse of contractors. In March, the Internal Revenue Service stopped using two private tax collection companies because, according to an agency statement, "IRS collection is more cost-effective than the contractors." http://www.washingtonpost.com/wp-dyn/co ... 02812.html

6) The military. As of some time ago it cost about $1,000,000 per soldier, per year, to station them in Afghanistan. This absurd amount is no doubt largely because so many military services have been out-sourced to expensive profit driven private contractors. Note:

"Contractors Outnumber U.S. Troops in Afghanistan"
"The White House Office of Management and Budget is directing federal agencies to take a series of actions designed to reduce the government's growing reliance on outside contractors..." Link

"Frederick D. Barton, a senior adviser to the Center for Strategic and International Studies in Washington,... questioned whether using contractors was cost effective, saying that no one really knew whether having a force made up mainly of contractors whose salaries were often triple or quadruple those of a corresponding soldier or Marine was cheaper or more expensive for the American taxpayer." Link

A pay-as-you-go system is not a trust fund.

Why not?

...a transfer payment by definition is different from self-funding,

Not at all. It's a self-funding transfer payment.

people still seem to be able to fall quite low,

That's supposed to be an argument against SS? Sounds like an argument for higher taxes and higher funding. I have gutters for my roof, but they don't catch all the water. Sometimes they overflow. An argument against gutters?

The government is the liar here.

Write your congressman.

...any claim I make in regard to politics will seem tedious and difficult to take seriously to you.

Being an anarchist, you are no doubt used to that by now.

[David Franks]

RE Length of posts

You can make long posts easier to read by leaving less space in them. When you respond to a quote, responding on the same line as the end-quote code puts your response immediately under the quote; if you respond on the next line (no empty line space), there will be a line space when you post. If you reply with a line space, there will be two line spaces, which breaks the continuity and requires more scrolling. And be careful that your quotes don't contain extra line spaces. (When I post a tome, I go through quoted material and remove extra line spaces.)

Reducing the number of one-line paragraphs helps, too.

[Indium Flappers]

You don't address their claim. Is it true that "today’s retirees ... would have a pension two, three, or more times larger than their Social Security pension if they had been allowed to invest their FICA taxes in stocks"?

It is such a gross generalization-- so dependent upon the span of years in which one invests and one's investment strategy-- that one would have to be either stupid or dishonest to offer it as a justification for privatizing Social Security. For example, my household retirement investments lost about 30% of their value in Bush's grand recession-- and we were lucky. Social Security did not lose value.

The benefits given to recipients have been continuously decreasing, as the article from the Independent Review demonstrates. How does that not constitute a loss in value?

Also, thank you for the info on how to make posts more readable!

[David Franks]

The benefits given to recipients have been continuously decreasing, as the article from the Independent Review demonstrates. How does that not constitute a loss in value?

The principal was not diminished. My point would have been clearer had I said "the Social Security trust fund" in order to make it more clear that I was comparing income sources.

I think the government is not charging enough interest on the trust fund principal that it lends, but that's another issue.

[Indium Flappers]

The benefits given to recipients have been continuously decreasing, as the article from the Independent Review demonstrates. How does that not constitute a loss in value?

The principal was not diminished. My point would have been clearer had I said "the Social Security trust fund" in order to make it more clear that I was comparing income sources.
I think the government is not charging enough interest on the trust fund principal that it lends, but that's another issue.

I hate to sound like a broken record, but this discussion might have been made easier if someone were able to take the time to read the article from which I took the title of this thread. At least then I could stop bringing up points Browning already made in the article.

But, you may ask, what about the trust funds we hear about all the time? Doesn’t the money go into the trust funds? It is true that there are trust funds, but they play a minor, even negligible, role in the operation of Social Security. They are temporarily playing a somewhat larger role right now than they did in the past or will in the future, but it is a minor factor even today. (In 2005, eighty-four cents of each dollar in workers’ taxes were paid out immediately as retirement benefits; only sixteen cents went into the trust funds.) I discuss the trust funds later, but we can get a clearer understanding of how Social Security operates by first ignoring them.

What is your response to this contention, and to the further contention that having an institution, in this case the government, "invest" funds into bonds in that same institution, which it then calls an asset, makes little sense, and would be considered fraudulent if done by a private company? Are they not essentially loaning money to themselves?

My understanding of a "trust fund" implies that the money is kept rather than being spent, while my understanding of a pay-as-you-go system implies that the money is paid through to another person. Would someone be willing to explain to little-ol'-me how a pay-as-you-go system can also be a trust fund? It seems more accurate to say that SS involves both a pay-as-you-go system and a trust fund, which are separate from each other, but that, as Browning says, the trust fund plays a negligible role, and, since it involves treasury bonds purchased by the government itself, is of no practical use, since cashing in these bonds to make the payments would involve raising taxes or otherwise raising extra money anyway.

Also, my understanding of the term "self-funded", to reply to Dardedar's assertion that SS is a "self-funded transfer payment", is that "self-funded" implies that the payment given to one is funded by themselves, rather than out of a common pool or payments from, in this case, current workers. In SS, current retirees are funded by current workers. How then are the benefits paid out to current retirees self-funded?

[Indium Flappers]

No, no, no, wait, wait, wait, let me guess, you'll argue that...

*spoiler, please post argument before reading...*The government is actually being financially adept by using money from taxes instead of "raiding" the trust funds, so the fact the trust funds get so little use is an argument in their favor.*

I would actually argue against this, but I want to see if I can guess what you'll say. Pretend you're testing a psychic or something.

[Dardedar]

this discussion might have been made easier if someone were able to take the time to read the article from which I took the title of this thread.

The abstract was enough. It matters not if his thesis is correct. It's based upon this same most basic misunderstanding of what SS is and is intended to be. One that the right-wing has promulgated from day one. SS is not an investment program. It's a societal decision to tax and provide a self-funded and extremely efficiently delivered floor beneath which we will not let people fall below.
The most recent and best made case for doing this was put together, polished and offered for sale by all of the best conservative minds (*cough*) during the beginning of Bush's second term. Read their pro arguments and then read the arguments that ripped the balls off of Bush's case. I wrote some doosey's myself but they are buried email's about 9-10 years old now. I was up on the details back in the day. Not so much now.

The populace considered Bush's attempt at privatization (I remember he made over 100 flights with Airforce One while campaigning for this turd). And I remember predicting, specifically and confidently to an extreme conservative associate that he would completely fall on his face in the attempt. As he did. I should have offered to bet him.
(Note: I am not saying it follows that your argument/position fails because Bush got roasted on this, but only that it provides a recent and instructive reason for why privatization or destruction of SS was not something the US populace was remotely interested in).

Perhaps of interest: Primer on Bush SS plan.

Also Ryan supported Social Security privatization in 2005. What was that again?.

[Indium Flappers]

What about this article from reason.com?

52 Percent of Young Americans Favor Social Security Opt-Outs Even If It Reduces Current Benefits.

When facing this trade-off, younger and older Americans significantly diverge in their policy response. Even when faced with the trade-off of reducing benefits to current seniors to allow younger workers to opt-out of Social Security, a majority (52 percent) of Americans under 35 favor the proposal. In stark contrast, 62 percent of Americans over 35 oppose the proposal. Instead, if allowing younger workers to opt-out of Social Security meant only paying Social Security benefits to seniors in financial need, then 60 percent of Americans under 35 favor the proposal, while a majority (53 percent) of Americans over 35 oppose the proposal.

[Dardedar]

What about this article from reason.com?

An excerpt, square brackets mine:

"After these initial questions were asked, Americans were given additional information about the current status of the program according to the Social Security Administration. First, they were told that Social Security currently pays out more than it collects in taxes [misleading, SS is trillions in surplus], and that without any changes the Social Security Trust Fund would be depleted by 2033, [very misleading] possibly resulting in a benefit reduction of 25 percent or more. Knowing this, 57 percent of Americans favored changing the way benefits are calculated so they increase at a slower rate than they do now."

Polling Joe public on the technicalities of the inner workings of what people believe to be a very boring/arcane topic like SS doesn't mean much to me, but it means exactly zero when you actually feed whoppers to the respondents just before you ask the questions. This is pathetic.

Indium, I've been around a while. I've subscribed to dozens of magazines over the years, from the far left (Nation, The Progressive, Utne Reader etc.) to stuff on the far right (Reason, Imprimis), and everything in between. I really tried to read Reason mag for a while and to give these libertarians a shot at making a case (catchy name) but I constantly, *constantly* caught them spinning facts beyond recognition. You can read this fringe stuff on the left or right, but realize as you do it, it is filled with spin, distortion and crap information and in my experience, the libertarians are among the worst (except for perhaps those goddamn anarchists).

Just kidding about that.

D.
-------------
(Not really kidding about that). Present company excluded of course.

Footnotes:
"Social Security Has “A Large and Growing Surplus”
"Today’s report from the Social Security Trustees shows that our Social Security system has a large and growing surplus. Unlike the banks, which nearly brought the economy to ruin, Social Security didn’t need a bailout. Its surplus has grown year after year, even during the Great Recession. The result of decades of foresight and planning, its cumulative surplus is projected to be $2.8 trillion in 2013, growing to $2.9 trillion by 2020. Social Security does not and cannot contribute to the deficit. Social Security will take in more money than it pays out, roughly $28 billion more in 2013. Social Security has a large surplus in 2013 because it has more than enough income from its three sources of revenue to cover its expenses — payroll contributions, interest payments on the $2.8 trillion invested in U.S. Treasury bonds and taxation of benefits." Link

"Social Security Depletion Date Still 2033"
"The annual report released today by the Social Security Board of Trustees said the year the combined assets of the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds are projected to become depleted is unchanged from predictions last year, with 77% of benefits still payable at that time." Link

Underline mine.

[Indium Flappers]

On the matter of Ponzi-schemeness:

Dictionary.com gives these 3 definitions of a Ponzi Scheme:

Pon·zi
/ˈpɒnzi/ Show Spelled [pon-zee] Show IPA
noun
a swindle in which a quick return, made up of money from new investors, on an initial investment lures the victim into much bigger risks.

Ponzi scheme (ˈpɒnzɪ)
— n
a fraudulent investment operation that pays quick returns to initial contributors using money from subsequent contributors rather than profit

Ponzi scheme
investment scam by which early investors are paid off from the contributions of later ones, 1957, in ref. to Charles Ponzi, who perpetrated such a scam in U.S., 1919-20.

Quoting from earlier in our conversation:

The superficial similarity to a Ponzi scheme is that different sets of investors are relying on future investors, or at least future growth, to get paid back. But that defines a Ponzi scheme so broadly as to make the term meaningless. In that definition, any intergenerational transfer system is a Ponzi scheme.

They appear to be rather intelligent. Indeed, in that definition any system in which former investors are relying on the payments of future investors would certainly quack like a Ponzi scheme.

Bingo.

Ezra Klein's definition, by which he appears to agree with SS's characterization as a Ponzi scheme, seems to match the actual dictionary definitions. The dictionary definitions also specifies a Ponzi scheme as an "investment" scam, and you've made it a point to portray it as an "insurance program" rather than an "investment program", (even though from my reading of insurance programs, most private insurance programs seem to work by investing the money in stocks and bonds, which is what Browning suggests doing, while SS "invests" in Treasury bonds, which as I pointed out above seems to amount to the government writing itself an IOU), but Ezra Klein even uses the term "investor", and in any case one could replace the term "investor" with "contributor" while keeping the same essential payment mechanism. Also, note on the argument about sustainability above, Bernie Madoff's Ponzi scheme began somewhere around the early 90's (according to Madoff) or early 70's (according to the FBI), and lasted until around 2009, so about 20-40 years.

So, comparing characteristics of SS to characteristics of a Ponzi Scheme:

• Current beneficiaries paid off primarily by current contributors - Yes.
• Decreasing number of contributors available to pay for benefits - Yes, though the SSA claims that this is temporary.
• Able to be kept up for decades - Yes, though the benefits for SS have been decreasing.
• Participants largely unknowledgeable about the system - Yes.
• Administrators of the system making false promises or misleading claims about how the system works - Yes.
• Portrayed as investment program - Yes for Ponzi schemes but no for SS. Neither you or Browning portray it as an investment program. (The main problem Browning has with it is that the money is not invested, as it would have been in a private insurance program, as far as I can gather.)

What other variables should I add?

First, they were told that Social Security currently pays out more than it collects in taxes [misleading, SS is trillions in surplus], and that without any changes the Social Security Trust Fund would be depleted by 2033, [very misleading] possibly resulting in a benefit reduction of 25 percent or more.

...
"Social Security Depletion Date Still 2033"
"The annual report released today by the Social Security Board of Trustees said the year the combined assets of the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds are projected to become depleted is unchanged from predictions last year, with 77% of benefits still payable at that time." Link

So, Reason claims that the depletion date is 2033, your citation claims that it is 2033, Reason claims it could "possibly" result in a benefit reduction of "25 percent or more", and your citation claims that "77% of benefits" will still be payable, meaning 23% will not be payable.

I admit "25 percent or more" is greater than the 23% given by your citation, but it doesn't sound like a "whopper" even by your source. I'm surprised they're so close. Also, from your first link:

To address the long-term shortfall in OASDI, Congress should legislate that everyone pay the same
Social Security contribution rate on all wages. The dramatic growth of income inequality, where
wages at the top have grown so much faster than average wages, has caused Social Security to lose
income. It’s time to fix this. Congress could eliminate almost all of the projected shortfall by raising
the Social Security payroll tax cap so that the 6 percent of workers who make more than $113,700 a
year contribute on all of their wages just like everyone else.

It sounds like they are assuming an increase in taxes when they say the benefits will last. (As you also assumed earlier in the conversation.)

I'll investigate the claim about SS having a surplus.

[David Franks]

So, comparing characteristics of SS to characteristics of a Ponzi Scheme:

• Current beneficiaries paid off primarily by current contributors - Yes.
• Decreasing number of contributors available to pay for benefits - Yes, though the SSA claims that this is temporary.
• Able to be kept up for decades - Yes, though the benefits for SS have been decreasing.
• Participants largely unknowledgeable about the system - Yes.
• Administrators of the system making false promises or misleading claims about how the system works - Yes.
• Portrayed as investment program - Yes for Ponzi schemes but no for SS. Neither you or Browning portray it as an investment program. (The main problem Browning has with it is that the money is not invested, as it would have been in a private insurance program, as far as I can gather.)

What other variables should I add?

A few points:
-- Social Security does not necessarily have a deceasing number of contributors; the contributor pool goes up and down. The most recent drop in the U.S. birth rate appears to be tied to the economy, so it is not likely to be permanent. In the meantime, some of the slack is being taken up by immigrants and people like the Duggars.
-- One thing that keeps Social Security going is that, like other forms of insurance, it depends on the fact that some beneficiaries will not get all of the benefits they are entitled to because they will die before that happens. Unlike a Ponzi scheme, which promises immediate returns (and the more immediate a given return is, the more spectacular it appears to be), Social Security is set up for the long term, and we all (should) know that.
-- The fact that participants are not generally knowledgeable about Social Security is not the fault of the SSA. Again, fraudulent intent (and so unavailability of information) is an integral part of the definition of a Ponzi scheme. Most people know very little about their stock market investments. Does that make the stock market fraudulent?
-- The SSA makes frequent predictions as information becomes available, but I've never heard the SSA make promises or misleading claims. (Congresspeople and the president are not administrators.) Examples?

The contention that there is no Social Security trust fund is an old-fashioned and simplistic view of how money works. Al Gore's suggestion that Social Security be put in a "lockbox" was just as silly. Money is no longer an asset that sits in a vault. Paying retiree benefits with revenue from current workers is one of the ways that money circulates-- and not just in Social Security or Ponzi schemes. When my retirement investments grow, it is because other people are working; though it is a very indirect form of payment-- and not very dependable, as Bush's grand recession demonstrated-- current workers pay for my retirement.

[Dardedar]

On the matter of Ponzi-schemeness:

I used to have more patience for this nonsense, but it's slipping. I just bought the new Samsung S4 phone today and it holds a great many wonders. Also, I have a nice picture collection of girls with tattoos that needs to be organized. That has got to be more useful than smacking these half century old rightwing whoppers about SS. David has experience as an educator and is used to working with students so perhaps he will be willing to talk to you regarding this semantic word game silliness of SS being a ponzi scheme, but I just can't do it any more. It's painful. I can't take the argument seriously and I can't take people seriously who peddle it, especially after they've pretty much acknowledged that they can see it doesn't work. It's halfway to a hogeye and again reinforces my consistent experience that those who associate themselves with the category of anarchy have some sort of mental issue that does not allow them to see things right in front of their face that almost everyone else can see. They are good at memorizing facts but can't get nuance. And they really like to appeal to these semantic, taxonomy games of... 'here are three dictionary which might allow this to mean this, which means this might mean this and that supports my crazy self-serving use of language..."

So I'll be brief and then it's on to something useful.

Dictionary.com gives these 3 definitions of a Ponzi Scheme:

The classic, anarchist attempt to define your way to a silly, false, conclusion. The defining characteristic of a ponzi scheme is that it requires an exponential increase in incoming dolts widening the bottom of the pyramid in order to appear to fund itself in a sustainable. This is why they are illegal. This is why they cannot work. This has no relation to SS, which can be entirely stable for all time because it simply taxes the populace to pay for a societal need. The taxes will go up and down to adjust for demographics. This was known from the beginning. This has been explained to you, and you appeared to understand. Again:

"If the demographics of the population were stable, then a pay-as-you-go system would not have demographically-driven financing ups and downs, and no thoughtful person would be tempted to compare it to a Ponzi arrangement. However, since population demographics tend to rise and fall, the balance in pay-as-you-go systems tends to rise and fall as well. This vulnerability to demographic ups and downs is one of the problems with pay-as-you-go financing. But this problem has nothing to do with Ponzi schemes or any other fraudulent form of financing; it is simply the nature of pay-as-you-go systems." --Gov, SS article

As said on this forum years ago: "Anyone who thinks SS is a Ponzi scheme either doesn't understand SS, or a Ponzi scheme, or both. Thanks to our rightwing media and a profoundly misinformed populace, this condition is very common."

What other variables should I add?

You should avoid confusing SS with a ponzi system because it will cause reasonable people to not take you seriously and they will assume, correctly, that you don't have a good knowledge of either.

First, they were told that Social Security currently pays out more than it collects in taxes [misleading, SS is trillions in surplus], and that without any changes the Social Security Trust Fund would be depleted by 2033, [very misleading] possibly resulting in a benefit reduction of 25 percent or more.

...

"Social Security Depletion Date Still 2033"

Now, at this point would could assume that I am too stupid to read the headline of the evidence I provided to support my claim, or perhaps.... something else is going on.

Guess what, something else is going on, but it will requiring considering something beyond a superficial level.

Tip: When those on the far left or right (Reason mag.) are going to mislead they are typically smart enough to do it with canards, not with outright factual lying. That is, a statement that is factually correct, but misleading (still lying AFAIC) because it doesn't include necessary information. The folks at Reason swim a sea of this. It is a primary tactic. Those on the left do it too. For those who can see through this stuff, it's very boring.

Reason claims that the depletion date is 2033, your citation claims that it is 2033,

Which was your big clue that I was referring to something that wasn't bat to the face obvious.

Couple points, red flags:

When a polling group is feeding data to the people it is polling, it's a big read flag. When it's on something controversial that people are typically ignorant about, that's another flag. Referring to the "depletion date," without providing a bunch of important background information has the necessary effect of being extremely misleading (and the spinmeister at Reason know exactly what the are doing here) because:

a) the chance of us hitting that date without fixing it in advance is nearly zero.
b) if we hit it, and we wouldn't it, we would raise taxes to make up the difference
c) it's a moving target so that date means very little. Before the Great Bush Recession the depletion date was, as I remember, 2043. As we now come out of that fiscal mess, the date will be moved into the future.
d) the respondents are very unlikely to understand what "depletion" means here even if it is somewhat explained to them. The usual phrase these right-wingers like to use is "broke." But neither are very accurate because even if we hit that date (that is constantly moving, and we would fix it first anyway) SS would still have a vast income allow it to pay the vast majority of it's obligations. Which means it really isn't broke, it just means it isn't in surplus anymore.

Reason claims it could "possibly" result in a benefit reduction of "25 percent or more", and your citation claims that "77% of benefits" will still be payable,

Another clue that my quibble is not with this tiny difference, but rather that people are very unlikely to understand what this even means. They are too busing worrying that SS is going broke because these tools at Reason are purposely misleading them, which is what they do. It's what rightwingers never get tired of doing, lying about SS. And I really have no patience for it anymore. I would much rather play with my new phone.

Fixing/adjusting SS is really easy (medicare not so easy, which is why Obamacare is so important). Tax the rich. Take the cap off which allows the free ride the uber-wealthy get on all income over $110K. Something that not one in ten people know (at best). Then it's solvent for 75 years (as I've already said).

D.
---------------
"Despite what you may have seen or heard, the Social Security Trust Fund today has a $2.5 trillion surplus that is projected to grow to more than $4 trillion in 2023. According to the non-partisan Congressional Budget Office, Social Security will be able to pay every nickel owed to every eligible beneficiary until the year 2039. Let me repeat that. According to the people who have studied this issue most thoroughly, Social Security will be able to pay out all benefits for the next 29 years. At that time, in 2039, it will be able to pay out only 78 percent of benefits. What that means is that while the system is strong today and for many years to come, it’s important that we make some changes soon so that Social Security remains strong and solvent for the next 75 years. And there’s a pretty easy way to do that.
According to the Congressional Budget Office, if the Social Security payroll tax was applied to all income, Social Security would be solvent for the next 75 years. Right now, because of the cap on income subject to Social Security payroll taxes, someone who earns $106,800 a year pays the same amount into Social Security taxes as a billionaire. That’s wrong and unfair and must be changed. Simply applying the Social Security payroll tax to all incomes would correct this inequity and bring in enough funds to keep the system strong for the next 75 years."
Sanders Op-Ed: A way to make Social Security solvent for the next 75 years."
--Sen. Bernie Sanders, August 17, 2010, LINK

Before you get all jazzed about the difference between my $110k and Bernies $106,800 realize... it changes each year: "For earnings in 2013, this base is $113,700." http://www.socialsecurity.gov/oact/cola/cbb.html

[Indium Flappers]

The classic, anarchist attempt to define your way to a silly, false, conclusion.

You're the one who refused to read the article because they used definitions that make sense but which you don't like. The issue of whether or not it's a Ponzi scheme was not my main question, and to be honest I don't care about nomenclature, I continued talking about it because you tried to use it to smear my sources.

I am an anarchist because it is the tentative position to which scientific inquiry and curiosity have currently led me. I have done my best to contribute a bit of civil discussion to your happily inactive forum, and to refrain from ad hominem, emotive rhetoric, and other useless trite which you have littered throughout your replies.

I have also attempted to follow so-called "hacker ethic", which holds that "True communication is possible only between equals". I have thus attempted to ignore your intentionally offensive remarks about my age, tediousness, etc. Your present remark on anarchists in general having some kind of mental illness leads me to the conclusion that you must be trying your darnedest to get rid of me by offending me off of your forum, since you are minimally open-minded enough not to ban people for content.

[Dardedar]

You're the one who refused to read the article because they used definitions that make sense...

I didn't waste time reading the article because I could tell, as clearly spelled out in the abstract, that the person was peddling his thesis based upon the same foundational crock that you have been regurgitating as well. A basic misunderstanding... no, wait, maybe in your case a misunderstanding, in his his case it would be a practiced purposeful deception, that SS should compete with an investment program.

The issue of whether or not it's a Ponzi scheme was not my main question, and to be honest I don't care about nomenclature,..."

When someone reaches for three dictionaries in order to play semantics and smear some ponzi on social security, then they are one who is taking the action of caring about nomenclature.

I continued talking about it because you tried to use it to smear my sources.

And I will continue to. Anyone who thinks SS is a ponzi doesn't have a good understand what either is. And this gets to the nut of it, and I was going to mention it earlier. Even you know this ponzi bit is bag of crap. The reason you are backsliding now and resorting to trying to defend it, pathetically, is exactly as you just admitted, it's because there is an uncomfortable truth that follows from it being a bag of crap: it means a whole bunch of people you up look to, are invested in peddling this disgusting, dishonest, distortion. So to admit that they are all wet about this, would look bad on a whole swath of rightwing nuts that have made careers out of peddling this swill. Well get used to this, because these people you are looking to, and your Reason magazine, are heavily invested in this sort of "Truthiness." You can learn that now, or you can learn it 50 years from now, or you can possibly never learn and fall for this stuff for a lifetime. I'm not about to humor it in order to not be offensive.

I am an anarchist because it is the tentative position to which scientific inquiry and curiosity have currently led me.

That's great. The more tentative the better. Some people get lead to geo-centrism or whatever sort of quackery. Maybe you'll grow out of it. If you haven't noticed yet, you will need to develop a tough skin about it because a great number of people find it annoying. And they even have good reasons.

I have done my best to contribute a bit of civil discussion to your happily inactive forum, and to refrain from ad hominem,...

Indeed you have. And I've been much more rude than you. But then, I'm not the one going back to peddling annoying nonsense for the purpose of rehabilitating your "sources." Your sources suck.

I have also attempted to follow so-called "hacker ethic",... True communication is possible only between equals[/url]".

I have no interest in the question of who is more equal or less. The chips will fall where they may. And when you go on about SS without knowing it has always been a "pay as you go" system, or that it is trillions in surplus, or that it isn't a ponz scheme, then you are going on about a topic you know very little about. But worse, rather than looking to learn about the topic from reasonable sources, you are filling your head with nonsense by looking to crackpot sources. This will in a short time, make you what I call "studied stupid." You actually become less informed and more misinformed as you go. And it's a conscious choice because you don't have to look to quacky sources, even though the authoritative sources are going to be rather dry and boring compared to the radical bomb throwers extremists. It's much more fun being a radical. It is entirely appropriate to not know much about a topic. And it's appropriate to be taken to task when you try to defend stuff that can't be defended.

I have thus attempted to ignore your intentionally offensive remarks about my age,...

I asked you how old you are. You didn't answer. I have no intention of using that information (I basically know) to say you don't know what you are talking about because of your age. Because that would be redundant.

...tediousness, etc.

Tediousness is what happens to me when someone works to make themselves "studied stupid." It's much more annoying than a person who simply doesn't know something or is simple. It's when a person actively uses their intellect to sharpen their skills of deception/dishonesty. And I hate it. I'm not saying you're there, but you are laying the ground work. This is what you were doing when you were getting out the dictionaries and trying to rehabilitate the ponzi/SS bag of crap which you now say: "to be honest I don't care about."

Your present remark on anarchists in general having some kind of mental illness...

I didn't say "mental illness," I said: "my consistent experience [is] that those who associate themselves with the category of anarchy have some sort of mental issue that does not allow them to see things right in front of their face that almost everyone else can see." I have not had an interaction with an anarchist that had their head on straight or didn't fall in that category. Maybe they do exist. Maybe you're just dabbling. I don't really care. I am interested in smacking ideas, not persons.

...leads me to the conclusion that you must be trying your darnedest to get rid of me by offending me off of your forum,

Nope. If you can handle some pokes in the ribs with a goat horn, all the better. They won't hurt at all except to the degree that they are accurate. If this guy didn't get the boot then you're safe.

...since you are minimally open-minded enough not to ban people for content.

Indeed. And I think that's the way to go, even though it has lead to several prominent posters leaving because of it. I know of four specific people, who wrote me, that specifically left because of the obnoxious zealotry of the last anarchist. Perhaps they would have migrated to Facebook over time anyway, as I largely have too, but it certainly sped up the process. Also, the other day I invited a friend, an accountant and expert on these SS matters to come by and chime in, but he too, now, has no patience with this anarchist stuff. And he said so specifically.
So, you can use this little spat to learn something, or you can get defensive about it. You've been quite nice and I haven't been. I'll try to be better but I'm not going to be nice to your sources, I know them and their methods too well. As I said, I'm just losing patience with the novel extremism of the libertarian/anarchist mindset. It's just not funny anymore. Maybe David can handle it better.

D.
-----------------
"Meetings of the Libertarian can be pretty hilarious when you get cornered by a high school algebra teacher who wants to talk about privatizing the sidewalks for an hour." --P.J. O'Rourke

P.S. Good tip on the spacing David. That really works.

Edited by Savonarola, 20130825 0235: fixed URL tag