McCain On Social Security: ‘It’s A Ponzi Scheme That Bernie Madoff Would Be Proud Of’

Last week, Sen. John McCain (R-AZ) appeared on Tuscon, AZ, morning radio show Wake Up! Tuscon to discuss a variety of national issues, including the upcoming debate over the federal budget deficit.

At one point, the host asked McCain about the future solvency of the Social Security program. The host asked if there’s a simple solution to future shortfalls like saying that “everyone that’s under 50, you get to retire at 67.” McCain replied by saying that the program could be changed by increasing the eligibility for benefits by “a month every year or so” or by lifting the payroll tax cap. He went on to malign the program, saying that the system is “basically…already” bankrupt and that it’s a “Ponzi scheme that Bernie Madoff would be proud of”:

HOST: Is it a simple thing like saying like everyone that’s under 50, you get to retire at 67 –
MCCAIN: Yeah, and for example, increase the age eligibility by a month every year or so, I mean, uh, lift the cap. Right now there’s a certain amount you pay into Social Security, and then after that it’s not taxed. There’s a number of things you can do to that are pretty simple and are pretty gradual keep the system from going bankrupt which basically it already is, because we’ve already spent the money that’s in the Social Security trust fund. It’s a Ponzi scheme that Bernie Madoff would be proud of.

Listen to it:

By calling Social Security a Ponzi scheme, McCain appears to be aligning himself with other radical conservatives who have long sought to gut or privatize the popular public program. Last year, former House Majority Leader and FreedomWorks chairman Dick Armey called Social Security a “pay-as-you-go Ponzi scheme“; a month later, Texas Gov. Rick Perry (R) also compared the program to a Ponzi scheme. And Sen. Ron Johnson (R-WI) campaigned by making the same comparison in his television commercials.

All of these radical conservatives are wrong to make such a comparison between a criminal enterprise and one of America’s most successful social programs. A Ponzi scheme involves fraudulently manipulating investors’ money without being able to pay them back; meanwhile, Social Security is a program that has successfully managedAmericans’ money since its inception and has guaranteed them safe retirements.

And while McCain’s suggestion of lifting the payroll tax income cap has merit — it wouldessentially eliminate any shortfall in the program’s funding for the near future — his proposal to raise the Social Security retirement age does not. Raising the retirement age would force the “nearly half of workers over the age of 58 work at jobs that are either physically demanding or involve difficult work conditions” to work longer with fewer years of retirement, hurting their health and well-being.