President Bush in his recent State of the Union address called the U.S. Social Security System “…a great moral success of the 20th Century.” Mr. Bush is the leader of an immeasurably powerful government. The president’s assessment of Social Security’s moral achievement must be that of a man who believes, despite abundant evidence to the contrary, that government is an agent of moral good. Otherwise he must assume the role of villain in his own life’s story, a role no one willingly accepts.

In the 20th Century governments of all flavors, democracies, dictatorships and otherwise together murdered over 100 million innocent people. Even though the American government was responsible for a relatively small, though by no means insignificant portion of those deaths, we must examine any government’s assessment of moral success in the bright glare of history.

By 20th Century government standards anything short of mass murder is a moral triumph. It is only by government standards that a program modeled after Charles Ponzi’s famous pyramid scheme would define moral accomplishment.

From its beginning in 1935 politicians have told Americans that Social Security is an insurance program — that it has a “trust fund.” We believe such whoppers because, unlike politicians, we are too honest to tell them. We believe because it’s easier to believe than to admit we have no right to charge our Viagra to our grandchildren.

Social Security is not and has never been insurance. We have no contract with the government. We have no claim against our “contributions.” Congress can change the rules any time. An insurance company run like Social Security would be busted for fraud.

The trust fund is like a pile of IOU’s we left in our safety deposit box when we took out all the money for a week in Vegas. The only difference between Ponzi’s “postal reply coupon” swindle and Social Security is that the latter is run by politicians. The business model for Social Security is exactly the same as that of the pyramid scheme that earned undying infamy for swindler, Charles Ponzi. Money from new “investors” pays off old “investors.” There are no “investments” of any kind.

Today Ponzi’s name is synonymous with slimy fraud. In reality his swindle harmed almost no one. He was busted long before his pyramid would have collapsed on its own. In the final days before his arrest, Ponzi rode out a massive run. He paid out millions to panicked coupon holders. He paid until the lines of nervous investors who wanted out had vanished. But the bank regulators were watching closely. As soon as his account was overdrawn, they busted him and the bank that was carrying him.

Ponzi was bankrupt. But in the reckoning that followed there were many more winners than losers. People knew Ponzi was a crook. Never the less, it took 6 years and selective prosecution of 14 indictments before prosecutors, on their third try, got a jury to convict him of theft. No one had ever registered a complaint against him.

If the Feds had left him alone or, more certainly, if they had helped him, he could have continued his scam for generations by steadily raising the minimum “investment” and forcing everyone to “invest” — just like Social Security.

President Bush called Social Security “…a symbol of the trust between generations.” But trust between generations does not come about by government edict. Trust between generations grows in the fertile ground of mutually honored commitments to family and community. Trust between generations is poisoned when one generation loots the next, assuring its victims they can do the same.

The symbol of trust between adults is a contract. A contract is a formal exchange of promises between willing adults. Contracts can be as thick as a Bible, as simple as a handshake or as madly complex as a marriage.

We wisely forbid children from entering into contracts. We would rightly condemn anyone who contracted with a child. And yet, we look down into the cribs of our grandchildren and pretend to honor a solemn agreement when we fleece them for our cushy retirements, our free medical care and our Viagra. We promise them they will be able to do the same to their grandkids. What a deal. Sign here, kid. Never mind, Daddy will sign for you.

Governments do not invest, they spend. They do not persuade, they compel. They do not help anyone without hurting someone else. Asking government to achieve “moral success” in society is like asking a pack of weasels to manage a henhouse. Social Security isn’t “…a great moral success,” as George II maintains, but a chain letter at gunpoint.

We should privatize Social Security, not because it will otherwise go bankrupt, but because it has always been bankrupt, morally and financially, and will continue to be as long as it runs as an intergenerational Ponzi scheme.