By Lauren Callahan
TYLER, TX (KLTV) - Governor Rick Perry, the current frontrunner for the GOP presidential nomination, created a stir last week when he compared Social Security to a ponzi scheme.
"It is a Ponzi scheme to tell our kids that are 25 or 30 years old today, you're paying into a program that's going to be there," Perry said in an MSNBC debate on September 7.
Other Republican candidates were quick to pounce on Perry's comment during the debate. "Our nominee has to be someone who isn't committed to abolishing Social Security," former Governor Mitt Romney said.
So we wanted to find out—what's a ponzi scheme, and does our social security program qualify as one?
Ponzi schemes have been around for a long time, but they're named for Charles Ponzi, who became famous during the 1920s for taking investments and paying investors from their own money or from the money of other investors.
A ponzi scheme will eventually collapse, mainly because investors are being paid more than the fund takes in.
So, can Rick Perry compare social security to a ponzi scheme?
"I can see where people might compare it to that if they don't know the whole history," said Dovie Lawrence, a benefits counselor with the Area Agency on Aging of East Texas. "I couldn't say that it was a scheme. In the beginning it was intended to be a social insurance for the elderly, the unemployed, and their widows or dependent children."
Here's the problem: Social security was designed for people who are working now to pay people who aren't working anymore. And pretty soon, we'll have more retirees than workers.
As for calling social security a ponzi scheme … well, that's for you to decide.