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re: Jim Toedtman's article - Nov 2011
The reality is that the way Social Security is funded today, it IS a Ponzi scheme. The only thing that makes it work is the fact that "contributions are mandatory". Any Ponzi scheme would work if you could force new investors to continually contribute - and if you could adjust to contributions to the "benefits" you want to pay out.
I'm planning to retire in 5 years. Every dollar I pay today in SS taxes are used to pay current benefits. Not a penny is set aside for my retirement. And when I retire, all of my benefits will come from taxes collected during the year that I receive benefits.
Ever since Johnson mingled SS money with the general funds, Social Security has become another expense item in the budget along with every other item in the budget. Until we find a better way to fund it, there is no guarantee that we will be able to support benefits for future generations and retirees.