Be Careful, Republicans, When Attacking Perry on Social Security
September 12, 2011
RUSH: By the way, you Republicans, I'm gonna warn you about something here. I've not endorsed anybody, and this is not an endorsement, but be very careful if you start attacking Rick Perry on Social Security and a Ponzi scheme. There are too many of you out there who have already said that yourselves, Mitt Romney. Mitt, you have already called it a Ponzi scheme and worse. I've got a whole list of people here in politics, media and outside, who have referred to Social Security as a Ponzi scheme, and I'm hearing that Michele Bachmann is preparing to lay into Rick Perry on his comments about Social Security being a Ponzi scheme and I would like to warn everybody, be careful here because you're pandering to the media. You're pandering to the left-wing media by jumping on Perry on this Ponzi scheme business.
Do you think that if Social Security had been honestly described as what it was -- well, if somebody came to you and said we're gonna create this Ponzi scheme, that you're not gonna have any choice, would you want it? Of course not! Would you like a program that's gonna guarantee your retirement? Yeah. Fine. It's all in how the whole thing was put together.
RUSH: There's a Republican debate tonight. I don't think too many people are going to see it. It's up against a Monday Night Football game. There were two of them tonight, and the first one starts at seven. It's the New England Patriots and Miami Dolphins, and that's followed by the "Raida's" at Denver to play the Broncos. That's at 10:15. But don't worry, we'll have comments. They're gonna gang up on Rick Perry on Social Security tonight, and it is a mistake. They're going to do this to pander to the media. They're going to do this. It's all about the Ponzi scheme comment that was made. I think Newt will probably pile on; I know Romney is gonna pile on.
I'm even hearing Michele Bachmann is thinking of piling on Rick Perry about this, and it will be a mistake if they do this because remember, now: This is a Republican debate, the Republican primary we're talking about. The Republican base is the audience, and the Republican base -- Social Security, the entitlements -- everything that has to do with excessive spending is something they want our guys to look into and do something about here. Now, Romney himself has used the term "Ponzi scheme." He's had horrible things to say about it. He just doesn't believe you can get elected saying so, so he won't say so. He's put out a flier, the Romney flier attacking Rick Perry on Social Security and all that. It's a mistake.
Let me find something here. There's a number of pieces that I read since I have been out, since Thursday night, that go back and chronicle all the pundits and people who have called Social Security a "Ponzi scheme" and even worse. So apparently now the way the other Republican candidates hope to beat Perry is by attacking him from the left, and that's what they're going to be doing if they go after him on saying Social Security is a Ponzi scheme. Because the left is distorting what Perry is saying about this and therefore the Republican critics will be doing the same thing, and when you deny that Social Security is what it is -- and I'm not endorsing Perry, folks. As you know, I haven't done that yet. So I'm just observing.
I would have a question for Romney: What major program other than issuing waivers on Obamacare would be eliminate? There's a willingness of some people in the Republican field to burn down the entire conservative movement here with some of the comments that they are prepared to make, like for example I notice Romney doesn't attack Perry over illegal immigration. None of these guys are perfect. I don't want to be misunderstood here. I just think they ought to be very careful doing this because this is gonna set the tone. Something's gonna have to be done about the program. Even seasoned citizens realize that it is what it is. Even Obama is talking about a payroll tax cut.
If the program can continue by cutting its own funding source in half, then it has to be something illegitimate, my friends. And Obama's speech, his jobs speech -- and Republicans, you know, various ones have proposed either a tax holiday on the payroll tax or cutting it in half for a year or what have you. Well, that's the only funding source for Social Security! So if you're gonna cut the funding in half but the benefits continue, then what is the game? How does that work? In other words, your boss comes in and tells you your salary is being cut in half but you're gonna be able to spend the same amount of money.
Really? Where am I gonna get it? If you're gonna cut my salary in half, I keep my job, but I still can spend the same amount of money I had, how does it work? I'll tell you what: If Social Security is not a Ponzi scheme, then set Bernard Madoff free. Set him free today. If I understand those attacking Rick Perry correctly, Madoff's crime was that he didn't find enough new investors not that he defrauded anybody. That's not the crime, right? Madoff simply needed to "reform" his plan. Recipients needed to lower their expectations. There wasn't any fraud. The plan simply needed tweaking.
More investors, lower expectations of the participants, right? Isn't that what Social Security reform is gonna be? We need more taxpayers, we're gonna reduce the benefits. Nobody's been defrauded, right? So if Madoff woulda just done what they're doing with Social Security to fix it, fine and dandy, right? Well, of course not! This is my point. Let's see if I can find it. Oh, yes. Here we go. Stanley Kurtz, National Review Online. "t's certain that Perry's Ponzi-scheme claim is in no way original. Not only have a raft of conservatives called Social Security a Ponzi scheme over the years, quite a few very respectable liberals have done so as well. It is clearly wrong either to treat the Ponzi-scheme analogy as unprecedented or to rule it altogether out of legitimate public debate.
"A historical tour of the use of the Ponzi-scheme metaphor will make the point. Jonathan Last has already identified a 1967 Newsweek column by liberal economist and Nobel laureate Paul Samuelson as perhaps the earliest use of the Social Security/Ponzi-scheme comparison in public argument. ... Samuelson's idea that Social Security could best be understood as an enduring and rational Ponzi scheme grew out of his 'overlapping-generations model,' ... Samuelson's model implied that public debt in general, and Social Security in particular, could be financed over successive generations without major tax increases.
"In the 1980s, Samuelson's overlapping-generations model was seized upon by Keynesian economists to serve as a microeconomic foundation for their favored theories and plans. The unfortunate weakness of Samuelson's model is its assumption that a growing economy will produce continual population increase. In an April 1978 follow-up in Newsweek to his original 1967 column, Samuelson acknowledged that demographic reality was disproving this assumption. ... In an April 1999 Los Angeles Times op-ed titled 'Ponzi Game Needs Equitable Solution,' for example, Stanford University economists Victor Fuchs and John Shoven hark back to Samuelson's 1967 column," and they quote him.
"[T]he 1987 publication of Ben Wattenberg's book The Birth Dearth. Wattenberg, who once worked for Lyndon Johnson and Hubert Humphrey, was by the late 1980s a centrist Democrat... In a U.S. News & World Report cover story excerpting The Birth Dearth, Wattenberg sums up his argument by saying: 'In short, Social Security is a Ponzi game, a pyramid scheme, a chain letter.' ... We'll see more examples of liberals and Democrats calling Social Security a Ponzi scheme, but let's first note that from the mid-1980s on, the Ponzi analogy became a staple for conservatives. In an August 1985 editorial commenting on Social Security's 50th anniversary, the Wall Street Journal says the system was designed like a Ponzi scheme.
"A July 1994 Chicago Tribune column by Cato Institute head Edward Crane dubs the offices of the Social Security Administration 'home of the world's largest Ponzi scheme.' A 1995 piece by conservative columnist Michael Barone argues that '...many more voters under 50 realize that Medicare and Social Security are Ponzi schemes in which the benefits they're paying for today will be impossible to collect in the future without unthinkable tax increases.' ... In December of 1988, Ronald Reagan's budget director, James C. Miller III, made news when he called Social Security a Ponzi scheme before an audience at the National Press Club.
"Miller, however, had just left the Reagan administration and acknowledged that he would not have spoken as frankly while still in government... In September 1994, conservative columnist Jeff Jacoby made the same point: 'Not being a politician, I can say anything I like about Social Security -- even the truth. And the truth is that Social Security is an immense Ponzi scheme...' In a January 1997 op-ed in the Washington Post, left-liberal Robert Kuttner wrote: 'Critics of the system call it a giant Ponzi scheme. But as long as the economy and its tax base keep growing, there is nothing wrong with taxing current workers to finance current retirement.' ...
"In the fall of 1995, [liberal] Robert J. Shapiro published an article called 'Rethinking Social Security: The New Deal's Crowning Achievement Has Fallen and It Can't Get Up' ... complains that Social Security, as currently structured, is crowding out funding for young children ... [it's a] 'National Ponzi Scheme.' ... In January of 1996... William Raspberry ... argues that '[Social Security] is, in important ways, like a massive Ponzi scheme ...' n May of 1996, liberal columnist Jonathan Alter published a piece in Newsweek suggesting that former Democratic Colorado governor and erstwhile Clinton supporter Richard Lamm might run for president as the candidate of Ross Perot's Reform party. ... Lamm is praised as a 'truthteller' by Alter for being willing to say ... that Social Security is a 'well-meaning Ponzi scheme.' ...
"Mathew Miller..." Should I go on? " Around the same time, Matthew Miller, a senior writer for The New Republic, published a long piece on the future of Social Security. Miller begins his TNR article by recounting the U.S. Senate hearing on Social Security at which he and others had just testified. ... 'Only a grinch could grumble about the most effective anti-poverty program in history; but only a fool would fail to ask whether the Ponzi scheme is sustainable, and at what price.' ... Republican senator Simpson of Wyoming and Democratic senator Bob Kerrey of Nebraska ... were proposing changes such as mandatory savings accounts, means testing, and raising the retirement age. ...
"Senator Simpson was making news at just this time by garnering attention for his proposed Social Security reforms with aggressive use of the Ponzi-scheme point: 'This is a Ponzi scheme, and people don't know that,' said Simpson in August of 1996. ... In December of 1996, liberal Michael Kinsley published a piece at Slate titled, 'Social Security: From Ponzi Scheme to Shell Game.' ... March of 1998, then former New York Times executive editor Max Frankel turned one of his regular columns in The New York Times Magazine to the subject of Social Security. ... 'For more than 30 years, Presidents and Congresses have pretended that the Social Security Ponzi scheming [blah, blah, blah, blah, blah the majority of voters have been misled.'"
So it's nothing new that people have called Social Security a Ponzi scheme, and to harp all over Perry for doing this is to simply take the liberal side of an argument to try to curry favor with the liberal media here as though nobody has ever called it this. Now, the left, don't forget this, folks, the left doesn't want to be judged on the results of anything they do. They only want to be judged on their good intentions. FDR and his people knew that this whole program was unsustainable. They were banking on the fact that once it existed, the fact that it was sold to people in a fraudulent way would not matter because of the good intentions. It's a Ponzi scheme. Rick Perry's having the guts to say that it is and to go out here and attack him here, as I say, is simply to pick up the mantle of the liberal media or at least to try to curry favor with them. Ought to join the chorus.
RUSH: Let's go back to last Thursday on MSNBC Hardball, Chris Matthews talking to a couple guys about this whole Ponzi scheme, Social Security and Rick Perry. And Matthews says to Steve McMahon, Democrat strategerist, "Do you really believe that Perry can fix this Ponzi scheme gaffe?"
MCMAHON: He could probably fix the Ponzi scheme part because the Ponzi scheme is, people, probably many people would agree with that.
RUSH: It is, it's a Ponzi scheme. Yeah. Yet our guys are gonna jump all over him. Todd Harris, Republican strategerist. Matthews said, "Todd, why do Texans like this language, Ponzi scheme language?"
HARRIS: No, no. 'Cause he can say, you know what, it is a Ponzi scheme, but what I want to do now is talk about my plan to actually save it.
RUSH: That's what he's doing. Anyway, I'm just issuing, it's gonna be a warning to make a big issue out of this on the criticism side because it is true and it isn't gonna work for the critics, is the bottom line, and look, let's remember something here. All Perry did was call Social Security what it is, and then he said we need to figure out how to ensure future generations are not left holding bag and are not continually misled about their retirement. I'm paraphrasing, but that's what he said. It's not complicated. You know, Newt pounced on Paul Ryan for his Medicare plan, and Trump did, too. It's the only plan I've seen so far to try to modestly deal with that problem and now they're all gonna jump on Perry.
I just think Michele Bachmann, who I really admire here, needs to be very careful. If she doesn't think Social Security is a Ponzi scheme, then she needs to tell us what she thinks it is, separate and apart from how you fix it or alter it. Just don't get up there and portray yourself as a defender of a retirement program for the elderly, because that's not what it is either anymore. It's long since ceased being that.
Quick sound bite here. No, not enough time to do it. It's a montage of MSNBC people accusing Rick Perry of being me, basically saying that, ah, Rick Perry seems the kind of fellow who reads the Journal editorials and listens to Limbaugh. Seems like he's got Limbaugh on his side, Fox News and the Koch brothers and so forth. So they're starting to get worried about Perry out there.
RUSH: For the record, ladies and gentlemen, Mitt Romney called Social Security a fraudulent criminal enterprise in his latest book. If it is a criminal enterprise, what's criminal about it except insofar as it's a Ponzi scheme? From his book, No Apology: The Case for American Greatness, Romney compares those managing Social Security to criminals. I got the paragraph here. That's all you need to know as we go into the debate tonight. I'm sure Perry's ready for this. It's just a little warning.