Throw Fdr in Jail...

by Jonah Goldberg

Getting a lot of email like this:

You missed the biggest argument: it’s the world’s biggest Ponzi scheme. If a private citizen tried to start something exactly like it, they’d be thrown in jail, and rightly so. It was always called “Old Age, Survivors and Disability Insurance.” It isn’t insurance in any way, shape or form. There aren’t any reserves for claims…

I’m a Chartered Property Casualty Underwriter; I oughta know.

And…

Dear Mr. Goldberg,

What I cannot understand is that no one is applying the historic legal standard for the proper stewardship of money.

Legally, a fiduciary HAS TO INVEST in a diversified portfolio of stocks, bonds as well as other reasonable assets.

He HAS TO DIVERSIFY or he breaks fiduciary law.

This has been conventional wisdom as well as LAW for ages. Exactly why doesn’t anyone ask the Krugman’s of the world why the LEGAL standard for rationally investing money for pension funds, trusts and other types of custodial accounts doesn’t have any bearing on the largest “pension plan” ever?

Is Krugman’s private assets all in treasury bills? Does he think this is prudent? Then why in the world would anyone advocate against doing what a “wise” fiduciary is legally bound to do?

Why doesn’t anyone argue that Social Security is the only “pension fund” or “trust fund” that is run absolutely contrary to legal doctrine?

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