17th
The $100 Trillion Ponzi Scheme
Forbes published a very insightful analysis of former Treasury Department economist Bruce Bartlett on the massive unfunded liabilities of Social Security and Medicare.
Based on 2010 budget, the present value of all future unfunded liabilities needed to cover Social Security and Medicare is estimated at over $100 trillion, or 8.1% of GDP in perpetuity.
In order to cover that shortfall, income taxes have to increase 81% from 10% to 18.1% of GDP.
To summarize, we see that taxpayers are on the hook for Social Security and Medicare by these amounts: Social Security, 1.3% of GDP; Medicare part A, 2.8% of GDP; Medicare part B, 2.8% of GDP; and Medicare part D, 1.2% of GDP. This adds up to 8.1% of GDP.
Thus federal income taxes for every taxpayer would have to rise by roughly 81% to pay all of the benefits promised by these programs under current law over and above the payroll tax.
The article also covers the biggest ponzi scheme of all, the “Social Security Trust” scam.
The problem is that by law 100% of these “assets” are invested in Treasury securities. Therefore, the trust fund does not have any actual resources with which to pay Social Security benefits. It’s as if you wrote an IOU to yourself; no matter how large the IOU is it doesn’t increase your net worth.
Similarly to intercompany accounts that are eliminated at consolidation, the Social Security Trust and its $2.4 trillion of “assets” cancel out at government level.
