For the simple reason that it's not trying to make a profit - it's trying to give back to people the same amount of money they put in. If Charles Ponzi wanted

For the simple reason that it's not trying to make a profit - it's trying to give back to people the same amount of money they put in. If Charles Ponzi wanted to live modestly, but donate huge sums to charity so everybody would love the big-shot Ponzi, it wouldn't have been a Ponzi scheme? If he'd wanted to buy votes, would it have been less of a Ponzi scheem? It's more of a forced investment than anything else, with the variation of having the money skip a generation. Well, no. It's forced redistribution. The money is not invested; it's spent. The difference is that if all you do is give people the exact same amount of money they put in, you can run forever. All you need is a buffer of some kind. But SS was designed with the assumption that either demographics wouldn't change, or that they'd change so slowly that nobody would suffer politically for having invented Social Security.