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Context of 'February 2, 2009: Wall Street Journal Editorial Board Member Calls Social Security ‘a Big Ponzi Scheme’'

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Wall Street Journal editorial board member Stephen Moore, appearing as a guest on Fox News host Glenn Beck’s show, compares Social Security to “a big Ponzi scheme.” Moore and Beck are discussing the issue of the US debt, and Moore compares the cycle of different government agencies buying and selling portions of the debt to one another to Social Security, saying: “It’s very much like the way Social Security works. It’s a big Ponzi scheme. It’s like a big vault of IOUs.” [Media Matters, 2/2/2009; Media Matters, 9/7/2010] Beck will later call Social Security a “Stalinist” program designed to forcibly redistribute wealth to poorer citizens (see January 27, 2010).

Entity Tags: Glenn Beck, Stephen Moore, Fox News

Timeline Tags: Global Economic Crises, Domestic Propaganda

Tom Raum, a reporter and analyst for the Associated Press (AP), calls Social Security “a giant federal Ponzi scheme” destined to “bury… the nation ever deeper in debt.” Raum then writes: “Although calling Social Security a Ponzi scheme—think of the huge frauds that sent billionaires Bernard Madoff (see August 14, 2009) and R. Allen Stanford to prison—may be a bit of a stretch, there is one clear similarity. As in a Ponzi scheme, the concept works fine at first. So long as there are more new ‘investors’ pumping money into the system to pay off the earlier ones, everyone is happy. But at some point not enough new money is coming in and the scheme collapses.” Raum claims that Social Security system trustees have reported that by 2016, money paid out in benefits will exceed the revenues flowing in, and in 2037, the system will be entirely penniless. Thusly, Raum writes, Social Security “is projected to go insolvent in 2017.” [Associated Press, 8/16/2009] (The Raum article is reprinted over several days by different press outlets, but according to progressive media watchdog organization Media Matters, originally appears on August 12.) [Media Matters, 8/12/2009] However, the trustees did not say what Raum claims they said. In their May 12, 2009 report, the trustees said that the Social Security trust fund, not Social Security itself, will be completely depleted in 2037. And after that happens, according to the trustees, revenue from payroll taxes will be sufficient to pay about three-quarters of scheduled Social Security benefits through 2083: “Under the intermediate assumptions, the OASDI cost rate is projected to increase rapidly and first exceed the income rate in 2016, producing cash-flow deficits thereafter. Redemption of trust fund assets will allow continuation of full benefit payments on a timely basis until 2037, when the trust funds are projected to become exhausted. This redemption process will require a flow of cash from the general fund of the Treasury. Pressures on the federal budget will thus emerge well before 2037. Even if a trust fund’s assets are exhausted, however, tax income will continue to flow into the fund. Present tax rates are projected to be sufficient to pay 76 percent of scheduled benefits after trust fund exhaustion in 2037 and 74 percent of scheduled benefits in 2083.” The Associated Press accurately reported on the trustees’ report the same day it was issued. [Administration, 5/12/2009 pdf file; Associated Press, 5/12/2009; Media Matters, 8/12/2009] Stephen Moore of the Wall Street Journal made a similar claim to Raum’s in February (see February 2, 2009).

Entity Tags: Associated Press, Tom Raum, Stephen Moore

Timeline Tags: Global Economic Crises, Domestic Propaganda

Eric Bolling, a host on Fox Business Channel, appears as a guest on Fox News’s The Live Desk, where he attacks Social Security as a “Ponzi scheme.” Bolling explains that a lack of increase in July’s Consumer Price Index (CPI) means that Social Security benefits also fail to increase, but then shifts into a claim that Social Security is “underfunded or almost unfunded.… People are paying into Social Security. That money’s being used to pay for seniors right now, so, it’s kinda like a Ponzi scheme.… They should rename it the Madoff Social Security system, because down the road, there’s not going to be enough money.” Bolling is making reference to Wall Street financier Bernie Madoff, who stole billions of dollars from clients through a web of fraudulent schemes. [Media Matters, 8/14/2009; Media Matters, 9/7/2010] In February, the Wall Street Journal’s Stephen Moore made a similar claim (see February 2, 2009). And an Associated Press reporter made a similar claim two days before Bolling (see August 12-16, 2009).

Entity Tags: Eric Bolling, Bernard Lawrence (“Bernie”) Madoff, Stephen Moore, Fox News

Timeline Tags: Global Economic Crises, Domestic Propaganda

Fox News host Glenn Beck says that Social Security and Medicare are “socialist” programs that “should have never been created.” Beck tells his viewers: “Do you think programs like Social Security and Medicare represent socialism and should have never been created in the first place?… I’m an American. I read. I believe in the Constitution. And, of course, Social Security and Medicare represent socialism and should have never been created. Since FDR and his progressive buddies started Social Security, not our Founding Fathers, that should be fairly obvious to people.” Beck tells his viewers that Social Security was created by Harry Hopkins, an adviser to then-President Franklin Roosevelt who, Beck says, “had a relationship with [Josef] Stalin,” the then-dictator of the Soviet Union. Therefore, Beck says, Social Security is a Stalinist “redistribution of wealth” program that is inherently Marxist in its nature. [Media Matters, 1/27/2010; Media Matters, 9/7/2010] Beck’s allegation that Hopkins was some sort of “Stalinist” is false. The allegation originally came from KGB defector Oleg Gordievsky, who wrote a sensationlist book, KGB: The Inside Story, where he alleged Hopkins was “an unconscious spy” for the Soviet Union during World War II. In reality, Hopkins was the top official in the Roosevelt administration charged with dealing with Soviet officials during World War II. His job involved explaining American policies and positions to Stalin and other top Soviet officials. Since Soviets who spoke to Hopkins routinely reported the contacts to the Soviet national security agency, the NKVD, Hopkins was listed as a “source” or “agent” of information for Moscow. No evidence has ever surfaced that Hopkins provided any classified or unauthorized information to the USSR, or in any way worked to advance the cause of Soviet Communism. [New York Times, 10/28/1990]

Entity Tags: Josef Stalin, Fox News, Glenn Beck, Harry Lloyd Hopkins, Roosevelt administration, Oleg Gordievsky

Timeline Tags: Global Economic Crises, Domestic Propaganda

On Fox News’s business show Bulls and Bears, Fox Business Channel host Eric Bolling tells viewers that he is glad young Americans will not have Social Security and will have to work instead of relying on what he calls that “Ponzi scheme” of a program. When Bolling calls Social Security a “Ponzi scheme,” the host and four other guests laugh and call out approving statements; host Brenda Buttner shouts repeatedly, “I love his show!” Bolling says that it is good young people “realize they’re not going to be able to suck at the teat of the nanny state too much longer, get off their butt, work, put some money away, and not have to rely on a system that’s gonna fold, probably by the time they get to collect a check.” [Media Matters, 7/24/2010; Media Matters, 9/7/2010] In February 2009, the Wall Street Journal’s Stephen Moore made a similar claim (see February 2, 2009).

Entity Tags: Eric Bolling, Brenda Buttner, Stephen Moore, Fox News

Timeline Tags: Global Economic Crises, Domestic Propaganda

Fox News chief Roger Ailes acknowledges that Fox News has undergone what he calls a “course correction” over the last year, dialing back some of the most inflammatory and partisan rhetoric that is its brand. The release of talk show host Glenn Beck (see March 28 - April 6, 2011) is one of the actions Ailes has taken to “moderate” Fox News’s stance, as is the lower profile given former Alaska Governor Sarah Palin as a prominent Fox personality—once aggressively promoted by the network as the savior of the Republican Party, Palin is much less visible on the network now. Fox executives admit that after Barack Obama’s election in 2008 (see January 2009), “the entire network took a hard right turn (see February 2, 2009, February 9-10, 2009, February 10, 2009, February 20, 2009, March 16-17, 2009, March 17, 2009, March 17-24, 2009, March 18, 2009, March 23-24, 2009, March 24, 2009, March 24, 2009, March 31, 2009, April 1, 2009, April 1, 2009, April 1-2, 2009, April 3, 2009, April 3-7, 2009, April 6, 2009, April 6-13, 2009, April 6-7, 2009, April 13-15, 2009, April 15, 2009, April 16, 2009, April 22, 2009, April 23, 2009, April 28, 2009, April 29, 2009, May 5-6, 2009, May 6, 2009, May 8-15, 2009, May 13-14, 2009, May 26, 2009, May 27, 2009, June 2, 2009, July 8, 2009, July 23, 2009, July 27, 2009, July 28, 2009, July 28-29, 2009, July 30, 2009, August 3, 2009, August 3, 2009, August 7, 2009, August 8, 2009, August 10, 2009, August 10, 2009, August 11, 2009, August 11, 2009, August 14, 2009, August 28, 2009, September 1, 2009, September 12, 2009, September 18, 2009, September 29, 2009, October 11, 2009, October 16, 2009, November 3, 2009, November 5-8, 2009, November 18-19, 2009, November 24, 2009, January 27, 2010, May 20-22, 2010, June 11, 2010, June 24, 2010 and After, July 2, 2010, July 24, 2010, September 1, 2010, September 4, 2010, September 4, 2010, September 15-16, 2010, September 18, 2010, September 18, 2010, September 27, 2010, September 28, 2010, September 29, 2010, September 29, 2010, September 30, 2010, October 1, 2010, October 3, 2010, October 26, 2010, November 9-11, 2010 and After, and November 9-11, 2010 and After)… but, as the tea party’s popularity fades (see August 25, 2011), is edging back toward the mainstream” (see November 16, 2010, November 17-18, 2010, February 23, 2011, February 28, 2011, March 19-24, 2011, March 23, 2011, March 23, 2011, March 24, 2011, March 27-28, 2011, March 30, 2011, April 26, 2011, April 26, 2011, April 27, 2011, April 27, 2011, April 27, 2011, April 28, 2011, May 22, 2011, May 23-24, 2011, June 10, 2011, July 13-14, 2011, January 14, 2012, January 17-18, 2012, February 11-16, 2012, and February 12-13, 2012). Ailes has ordered the opinion show hosts such as Sean Hannity and Bill O’Reilly to tone down the rhetoric, in part in response to the shooting of Representative Gabrielle Giffords (D-AZ) and the resultant debate about the aggressive, violent rhetoric being promulgated on the right (see March 24, 2010). Moreover, as media pundit Howard Kurtz writes, “[i]t was, in his view, a chance to boost profits by grabbing a more moderate audience.” Ailes’s contract is up in 2013, and some expect the 71-year-old media magnate not to renew his contract thereafter. Ailes continues to insist that his news network is the only “fair and balanced” (see 1995) news outlet on television, with the other broadcast and cable news providers being relentlessly liberal in their presentations, but on the other hand implicitly admits that he routinely pushes right-wing memes and talking points on his network. Today, for example, he is touting Fox News’s new “Regulation Nation” series, pushing the idea that government regulations have a stranglehold on American business. “[N]o other network will cover that subject,” he says. “I think regulations are totally out of control.” Government bureaucrats hire Ph.D.s to “sit in the basement and draw up regulations to try to ruin your life,” he says. Under Ailes’s direction, Fox News will feature stories on “over-regulation” in many of its straight-news and opinion shows. Some non-Fox News conservative pundits, such as radio host Rush Limbaugh, wonder if Ailes hasn’t given up on his commitment to conservative principles in return for ratings, saying, “Fox wants these people [Republican primary candidates] to tear each other up, ‘cause they want approval from the mainstream media.” Kurtz says that Ailes has turned the Republican primary into his own “reality show” for ratings and profits, essentially agreeing with Limbaugh. Overall, others are registering that Ailes is attempting to dial back the hyperpartisan posturing, even former Obama administration aide Anita Dunn, who says, “You have the sense that they’re trying to at least appear less of the hyperpartisan political network they had been.” [Newsweek, 9/25/2011]

Entity Tags: Gabrielle Giffords, Anita Dunn, Barack Obama, Fox News, Sean Hannity, Rush Limbaugh, Glenn Beck, Bill O’Reilly, Roger Ailes, Howard Kurtz, Sarah Palin

Timeline Tags: Domestic Propaganda


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