Presidential candidate Rick Perry has defended his claim that Social Security is a "Ponzi scheme," saying that the first step to fixing a problem is admitting it exists.
"Americans deserve a frank and honest discussion of the dire financial challenges facing the nearly 80-year-old program," Perry wrote in an opinion piece in USA Today.
"These are the hard facts: Social Security's unfunded liability is calculated in the trillions of dollars. Last year, annual Social Security outlays exceeded annual revenues for the first time since 1983," wrote the Texas governor.
"The Congressional Budget Office projects that outlays will be roughly 5 percent greater than revenues over the next five years, worsening as more and more baby boomers retire."
Perry has long described Social Security as a Ponzi scheme. He doubled down on his criticism of the system during Wednesday night's GOP presidential debate, when he also called it a "monstrous lie." Although he repeated the substance of his argument in his piece for USA Today, he did not repeat his use of either phrase.
"By 2037, retirees will only get roughly 76 cents back for every dollar that is put into Social Security unless reforms are implemented. Imagine how long a traditional retirement or investment plan could survive if it projected investors would lose 24 percent of their money?" he wrote.
Ponzi schemes are named after early 20th Century Boston swindler Charles Ponzi. They typically benefit early investors who get paid with money invested by those coming in later. However the cash runs out before those late investors see any benefit.
"Our elected leaders must have the strength to speak frankly about entitlement reform if we are to right our nation's financial course and get the USA working again," wrote Perry.
"For too long, politicians have been afraid to speak honestly about Social Security. We must have the guts to talk about its financial condition if we are to fix Social Security and make it financially viable for generations to come."
In an opposing editorial, USA Today accused Perry of "playing to fears among younger voters that Social Security won't be around for them." The paper said Social Security cannot correctly be described as a Ponzi scheme.
"Ponzi schemes have two salient features. First, they are criminal enterprises, which Social Security is not. Second, they work only until people get wind of what is going on, at which point they inevitably collapse. Social Security's finances are plainly visible for all to see.²
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