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Is Social Security Disability a Ponzi Scheme? Have Seniors “Really Paid Their Own Way?
Social security disability scheme faces censures though it is primarily meant as a welfare program. This article examines the issues involved and the solutions put forth to handle the situation.

Though named after Charles Ponzi who earned his notorious reputation for indulging in fraudulent money-making in the 1920s, the “Ponzi s heme! has e"isted e#en $efore his time% Charles Ponzi issued $onds that paid $a k an un$elie#a$le &0' interest in a matter of (& days, or 100' profit in )ust 90 days% Ponzi used to take the money in#ested $y his se ond set of in#estors to pay the first set of in#estor, and repeat this pra ti e% *ow is ++, similar to a Ponzi s heme- The similarity is only superfi ial in that money olle ted from new workers is $eing used to pay the $enefits for retired and disa$led workers% .t is to $e noted that not only go#ernment, $ut pri#ate pension systems also use this “pay-as-you-go! system% The pro$lem with federal programs su h as +o ial +e urity is that though implemented with pu$li interests in #iew, they may not $e feasi$le for the long term, espe ially when the num$er people in#esting money ontinue to get
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lower ompared to the num$er of people to whom $enefits are to $e paid% +in e the reation of this s heme, retirees and disa$led ha#e $een re ei#ing $enefits that were mu h more than their in#estments% /or the disa$led, payment is made on the $asis of a thorough medi al re ord re#iew% This is to ensure that the disa$led $enefi iary still meets the plan0s definition and is entitled to re ei#e $enefits% Payment of large amount of $enefits for retirees1disa$led has led to added finan ial $urden on later generations% 2#ery time +o ial +e urity e"panded, the already retired paid no additional ta"es, and those near retirement paid for a few more years% They re ei#ed $enefits, adding on to the $urden to $e arried $y later generations% .n 1930, the ,isa$ility and dependents0 $enefits were added to +o ial +e urity, and 4edi are was added in 1933% 4edi are Part 5 e"panded the $enefits, wherein only a 6uarter was funded $y re ipients, and in Part , pres ription drug $enefit, only 117th was funded $y $enefi iaries% +o ial +e urity was signed into law in 198& $y /ranklin 9oose#elt at a time when the a#erage life e"pe tan y was 31%: years while the +o ial +e urity retirement age was 3& ;i%e% 8%8 years later%< = ording to the >%+% Centers for ,isease Control and Pre#ention0s ?ational Center for *ealth statisti s, the a#erage life e"pe tan y for =meri ans has in reased from :7%3 years in 2009 to :7%: in 2010% *owe#er, the +o ial +e urity eligi$ility age ontinues to $e the same% This is the main reason for the impra ti ality of the +o ial +e urity program% @oing $y 9oose#elt0s reasoning, the +o ial +e urity eligi$ility age
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should $e raised from age 32, the ommon age people start re ei#ing ++ $enefits% = ording to a report in nsnews% om that highlights new data released $y the +o ial +e urity =dministration trustees, o#er the last fi#e years the num$er of people re ei#ing disa$ility $enefits has phenomenally in reased% Conse6uently, the surplus in that fund has $een redu ed from A213 $illion in 2007 to little more than A 100 $illion in 2018% .n Banuary 2009 there were :%( million $enefi iaries while the num$er has gone up to nearly nine million in C to$er 2018% .n addition, there are another 2 million spouses and hildren of disa$led employees who are re ei#ing $enefits% >ndou$tedly, it0s high time the on erned authorities took matters in hand, held dis ussions and adopted onstru ti#e measures to hange the +o ial +e urity system% =my 9idenour in her write-up in @azetteDtra addresses this ma)or on ern regarding +o ial +e urity $enefits and suggests some remedial measures% +o ial se urity eligi$ility age should ideally $e raised to :0 or higherE the on ept that employees should $e sa#ing money to retire need to $e re#i#edE younger workers should $e allowed to in#est their payroll ta"es in traditional, regulated in#estments that grow o#er the yearsE and full $enefits should $e assured to people retiring or a$out to retire%
Posted $y !OS !edical Record Review "om#any httpF11www%mosmedi alre ordre#iew% om1

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