Social Secuity as Ponzi Scheme

Rick Perry says that Social Security is a Ponzi scheme.  One difference is that a Ponzi scheme requires all (or most of) its participants to have unrealistic expectations about the future and Social Security does not.  A Ponzi scheme requires exponential growth whereas Social Security does not.  There are some elements of similarity, but Social Security funding is more like the way public education is funded.  It is a pay-as-you-go intergenerational tax and transfer program.  If you think of it as a government spending program, then it isn't any different from education spending or defense spending.  If you think of it as being like an individual investment account (which it is not), then there are some Ponzi-like rises and falls in the return on investment (ROI) due to demographic shifts.  When the baby-boom generation was working, they paid a lot into Social Security and their parents got a really good deal (high ROI).  But the baby boom won't get as good of a deal (ROI) as generations before them because there will be fewer workers supporting them.  Demographic shifts make all spending programs more difficult, and create a Ponzi-like dynamic, but they do not make spending programs like Social Security inherently unsustainable.  Milton Friedman noted that Social Security has been called a Ponzi scheme by many of its opponents who seem to think it is unsustainable and fraudulent like a true Ponzi scheme. The Social Security Administration explains the difference in detail.