Secret #5: The Largest Ponzi Scheme in the Country is Medicare
Many people were horrified by Bernie’s Madoff theft of over $50 billion of investor money. They thought that the SEC and the government would protect them from such a massive and obvious scam. It’s true that he will probably spend the rest of his life in jail. However, that won’t help the people who lost all the money.
What many people don’t know (or choose to ignore) is that the Medicare and Medicaid liabilities are 1,000 times greater than the Madoff scam. These liabilities are currently estimated at $62 trillion. It’s gotten to the point that these sums are so big that we can’t even imagine them.
In addition, I believe that this sum is massively underestimated. People are living longer and longer, and in 30 years people will be living 10 years longer than they live now. Besides that, the cost of healthcare is increasing exponentially. These two factors are not adequately addressed in the above estimate.
Is Medicare really a Ponzi scheme? It is simply paying people who put money in first with the money collected later. And, yes, the government has already spent all the money collected, so there is nothing to fall back on. So, Medicare is a Ponzi scheme. Perhaps it was designed with the right idea, to take care of people when they are old. The problem is that the money coming out is increasing exponentially, and there is no way to replenish it fast enough.
The government doesn’t want you to know this because it undermines the system. If everyone knew that they would never collect the Medicare money that they pay in, then there will be a response. In fact, it will be more of a backlash. The only alternative is for the government to admit that there is a serious problem, and this too will have a massive negative response. So, most politicians just push the problem farther into the future. They let the next administration deal with it.
Most people just choose the easy way and trust the government. I don’t know if that’s such a good idea. The facts are obvious. The fiscal policy of just borrowing more and more money is too easy. One day soon will come the day of reckoning.
Related posts:
- Secret #1: Social Security is a Ponzi Scheme
- How To Run A Ponzi Scheme
- The Singularity… and the Trillion-Dollar Ponzi Scheme
- Madoff’s $50 Billion Scheme: What Should the Government Do?
- Secret #7: The Government will not be able to take Care of you
Related posts brought to you by Yet Another Related Posts Plugin.
is one of my favorite financial books of all time. It's an allegory about a guy who has a terrible job, and how he overcomes challenges to achieve his dreams.
>In addition, I believe that this sum is massively underestimated. People are living longer and longer, and in 30 years people will be living 10 years longer than they live now. Besides that, the cost of healthcare is increasing exponentially. These two factors are not adequately addressed in the above estimate.
No worries – as the economy sinks into oblivion life expectancies will follow suit, as planned
It’s frightening! Is Medicare really a Ponzi scheme? I just thought about it. We are investing our hard earned money in different schemes and some of them are mendatory to take part in. When an investment like Medicare can become a Ponzi scheme, so what else do we have to trust? Really frightening.
invest money
This is true but what about Social Security? I know I am paying into something I will receive ZERO from. I love the statements I get form Social Security Administration, they make me feel very secure
Hi Russell,
I agree. Did you notice how they never say they are going to go bankrupt and all the money will be gone? That’s not right.
Is this true? I am glad about Medicare but I don’t know if they are into Ponzi scheme. Scary.