‘Ponzi scheme’ rhetoric becoming GOP standard

Last week, during a debate for the Republican presidential candidates, Mitt Romney tried his best to make Rick Perry look far outside the American mainstream. Specifically on Social Security policy, Romney seized on the frontrunner’s rhetoric, arguing, “[T]he term ‘Ponzi scheme’ I think is over the top and unnecessary and frightful to many people.”

For much of the country, that’s probably true. For the Republican mainstream, Romney’s warnings aren’t resonating at all.

The Republican chairman of the House Budget Committee on Tuesday drew fire from the Democrats for backing Texas Gov. Rick Perry’s description of Social Security as a “Ponzi scheme.”

Social Security fits the technical definition of a Ponzi scheme, Rep. Paul Ryan (R-Wis.) told conservative Laura Ingraham on her radio show.

“It’s not a criminal enterprise, but it’s a pay-as-you-go system, where earlier investors — or say, taxpayers — get a positive rate of return, and the most recent investors — or taxpayers — get a negative rate of return,” he said. “That is how those schemes work.”

DCCC spokesman Jesse Ferguson said in a statement, “Ryan’s belief that Social Security works like a Ponzi scheme proves — once and for all — that House Republicans have really declared a war on seniors. A Ponzi scheme is Bernie Madoff ripping off Americans — not Social Security benefits that seniors earned and depend on during retirement.”

That’s true, but Republicans don’t seem to care. References to “Ponzi schemes” have gone from borderline extremism to GOP conventional wisdom in about a week. Perry seems to have gotten the ball rolling, but his line has now been endorsed by Paul Ryan, Indiana Gov. Mitch Daniels (R), and other GOP lawmakers.

Romney thinks this kind of talk is “over the top and unnecessary and frightful to many people”? For millions of voters, probably. For his party? Apparently not.

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Steve Benen

Steve Benen is a producer at MSNBC's The Rachel Maddow Show. He was the principal contributor to the Washington Monthly's Political Animal blog from August 2008 until January 2012.