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Germany never matured after WWII because its American parents protected it from the harsh realities of this world. Result: A chronically spoiled nation that will find itself a midget among geopolitical giants and unable to deal with the kudzu of Islam overgrowing the well-manicured garden that was Deutschland. Wiedersehen...niemals.

While that Ponzi Scheme statement is true for Germany it's also going to be true for the US in the future if we don'reform our Social Security and MediCare and MediCaid systems. While we will keep being the destination for many no muslim immigrants The US Social Security system is a Ponzi Scheme. It's just going to hit Germany sooner and harder.

Sock Puppet is correct. Sadly, the U.S. Social Security system is the same kind of Ponzi scheme. The saving grace is that in the U.S., Social Security isn't the all-consuming wealth transfer system as the benefits system in Germany; many American workers have figured this out and their retirements will be covered adequately by personal IRAs and 401K accounts. Nonetheless, there are going to be problems. (And this is compounded by the probabe collapse of several large traditional pension plans, such as the problems GM is encountering now.) The really nasty thing is, Social Security has always been sold to the public as a "pay-as-you-go" system, even though it was never actually managed as such. So there are a lot of people of about my age who are going to be paying the highest Social Security taxes ever during their working years, only to have the system go bankrupt at about the time they retire. The potential political ramifications of this -- with an older generation collecting benefits, while a younger generation pays for it and gets nothing in return -- are awesome.


You are right. The U.S. Soc Sec system will be eventually bankrupt. However, Congress designed this round of reform to last an additional 30 years. Remember, not only do wage earners pay 7% into the system, but the employers match the 7% dollar for dollar. We self–employed people pay 14% of our earnings into the system. That is a hell of dollar pool for Soc Sec and Medicare.

I think the controversial issues are yet to come. There are already Red states that are advocating for workman’s comp for illegal aliens. It is a matter of time before the debate is elevated to whether illegal aliens are eligible for Soc Sec. Some illegal aliens pay Soc Sec to dummy or stolen Soc Sec numbers that they have illegally obtained. Some liberals, either in Congress or on the bench, will argue that they are do “equity” and that they should be eligible for full Soc Sec benefits.

Also remember, welfare reform relieved the states from paying AFDC, (Aid to Families with Dependent Children) which was the traditional Welfare Program. It has been replaced with SSI, which is administered by the Soc Sec Administration. SSI is meant to pay those people in society who have never contributed to social security, but can not work because of a mental or physical disability. Mental disabilities now include depression and traditional mental illnesses. It is a matter to time before Attention Deficit Disorder, kleptomania and Post Pardum Depression will be added on. Ditto physical illnesses. Wait until TMJ and impotence are added on.

>> A chronically spoiled nation that will find itself a midget among geopolitical giants and unable to deal with the kudzu of Islam overgrowing the well-manicured garden that was Deutschland. Wiedersehen...niemals.

It's not just German and it's not just their problem. It is very much ours as well.
Menace In Europe
Traveling overland from London to Istanbul, journalist Claire Berlinski shows why the Continent has lately appeared so bewildering—and often so thoroughly obnoxious—to Americans. Speaking to Muslim immigrants, German rock stars, French cops, and Italian women who have better things to do than have children, she finds that Europe is still, despite everything, in the grip of the same old ancient demons. Anyone who knows the history can sense it: There is something ugly—and familiar—in the air.

Interview with the author

The essential problem is that Europe is fundamentally passive, paralyzed, and feckless. There are distinct historic reasons for this. I would add, moreover, that Europe will always be our problem. Our histories and destinies are too deeply intertwined for it to be otherwise. It is inadequate to say, as some do, “Pull out the troops and leave them to shift for themselves.”

Re: the comments on Soc. Sec., Medicare, etc.

All true. But there is some pragmatic hope on the horizon (HSAs, etc.). And there is one other factor that is cultural. Americans are a self-sufficient lot and I think the days of huge entitlement pgms are numbered - especially after the drug plan for seniors debacle.

I hope.

SPD, Cousin Dave & George are right. And, as Dave note, many Americans are preparing for this with personal accounts such as IRAs and 401(k)s. From what I know, the social security system of many European countries is even more vulnerable to the consequences of the pyramid. Since my time in Europe (which was many years ago), has the rate of average persons investing in the market for their own future increased? I know that it was quite rare compared to the U.S. during the 1980s, so are people more aware now of the concept of investing and that the government teat is not infinite?

As much as I hate to say this there is also the option of raising taxes.

This is a flexibilty the US has and Europe really does not have because of their current level of taxation and the percent of GDP already being consumed by their respective governments.

Joe I think Merkel is planning to raise the VAT

@George M - The system you describe resembles very much the German one, though we wouldn't call it a Ponzi game put a pyramid scheme. Like the pyramids it can only be kept up by an ever-growing number of participants which to expect would be beyond real. Another problem is that a connection of welfare payments to medical diagnoses is a generator of self-fulfilling prophecies. Simulation is just another paid job after all. As soon as you add PTSD to the list, the circulus vitiosus becomes obvious, since the traumatic stress may result from the threat of withholding the basic income. A system mature enough to abstain from this threat is still to be developed.

A diagnosis-based welfare system would spiral into a nightmare in which the citizens become transparent to the authorities rather than the other way round, which is itself another cause of stress. With the behavior you have to simulate to maintain a healthy balance between frustrating your data parasites and negotiating efficiently at the same time you may be expected to submit yourself to that system. This program is a trap in which you can get lost just as easily as in a pyramid, and the path in is paved with the best intentions. And all that only because welfare still is based on income redistribution rather than energy taxation.


That as well as a small increase to the retirement program.

Germans as we all know are not taxed enough. I am sure FranZ would agree with this statement.

In a social welfare state anything less than say 25% retained earnings by an individual speaks of a lack of social justice. Therefore the Germans have a ways to go to reach this goal. Not far you understand.

I am sure they will make it. All indications they are working hard to accomplish this.

"The potential political ramifications of this -- with an older generation collecting benefits, while a younger generation pays for it and gets nothing in return -- are awesome."

What are we going to do, lynch our own grandparents? I'm sure older folks feel a certain amount of guilt about it, but I don't harbor any resentment. All we can do is make sure we as a society learn the historical lessons from this ill-advised scheme. When we consider creating entitlement programs in the future, we have to be sure that we're not making our descendents foot the bill.

@joe - I know you think I would like to use taxation to humiliate capitalists, but this is not the case. Of course you expect nazi anticapitalism which would denounce both gaming the welfare system and gaming the stock market as effortless income of locusts, because it makes you feel good to think of me as some kind of dark avenger of the proletariat.

Let it rip. There is no need for nation states to raise all kinds of local taxes, it is enough if one tax is raised by an international agency. Just let ElBaradei, resp. his successor, tax nuclear waste storage and fossile resources exploitation all the same for proletarians, capitalists and, if you will, space aliens.

The best instrument for turning UN member states into democracies is to turn the world body into their budget provider. It would also provide the opportunity to employ the threat of withholding financing against regimes that deserve it, instead of against the citizen who makes use of his right to be lazy.

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