Madoff was only employing the Social Security business model

American Thinker with a good take on the world's largest Ponzi Scheme know as social security.

Ever wonder why the New York Times can report on a Ponzi scheme in the private sector and be totally oblivious to the Ponzi scheme that the U.S. Government has been running right under the Gray Lady's nose for seventy-five years? This hustle is called "Social Security."

In an article about the Bernie Madoff scandal and Ponzi schemes in general, Catherine Rampell makes it clear that she understands the basics. Her article is entitled "A Scheme With No Off Button":

"Mathematically speaking, Ponzi schemes are doomed. They work by bringing in new investors to pay off old ones. In pure form, there's never any actual business activity; the money just rolls backward from ever-increasing numbers of investors to keep up the appearance of profits. This means the scheme requires an infinite supply of new suckers."

This is also an accurate description of Social Security -- though no one at the Times seems to be aware of that fact.

Here is the same paragraph translated to reflect the big government version of Franklin Delano Roosevelt's Ponzi scheme -- which happens to be collected with the threat of imprisonment. (Words in bold italics are my reinterpretation throughout this article.):

"Mathematically speaking, Ponzi schemes are doomed. They work by bringing in new FICA payers to pay off old ones. In pure form, there's never any actual business activity; the money just rolls backward from ever-increasing numbers of new workers to keep up the appearance of being solvent. This means the scheme requires an infinite supply of new suckers -- for example you and me."

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