Americans Are Putting Billions More Than Usual in Their 401(k)s

Re:Americans Are Putting Billions More Than Usual in Their 4... by JumpCrisscross on Thursday January 05, 2017 @02:09PM (#13330332)

> A Ponzi scheme is by definition an illegal crime and an unsustainable set-up that crashes very quickly. Social Security and Medicare, which have been around for decades, are not criminal schemes.

This is terrible legalistic reasoning. It essentially says the government cannot create a Ponzi scheme because Ponzi schemes are by definition illegal and governments define what is legal.

Better reasoning would incorporate the government's indirect control of inflation, direct control of federal wages and ability to "restructure" social security benefits and taxes, as well as the fact that the economy grows in real terms. This reasoning is more complex, but it is behind why investing in a start-up that plans to go public isn't a Ponzi scheme.

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Re:Americans Are Putting Billions More Than Usual in Their 4... by chockablock on Thursday January 05, 2017 @03:08PM (#13330876)

Enough with the straw man. The article's thesis absolutely does not hang on this interpretation, which only appears deep into the summary. Briefly, in contrast with a Ponzi scheme promising unsustainable returns on investment:

-There are no promises of huge returns

-The inner workings of the program are public knowledge

-There is no fundamental demographic or mathematical reason the system (a pretty straight-ahead social insurance program involving a certain amount of wealth transfer) should ever become insolvent, assuming the political will exists to keep it running.

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