Following today's New York Times invasion of CNBC, where two of its most irrelevant columnists are now part of CNBC's most irrelevant hourly block so at least it is symmetric, Rick Santelli and "The Earth is flat...but I sure am round" author Tom Friedman had a choice exchange of words which culminated with Rick Santelli finally telling the world's most overhyped patron saint of globalization the bitter truth. In the meantime, not even the very non-flat Friemdan had an answer to Santelli's very simple question: is Social Security a ponzi scheme... And while we are there, we wonder just what noun would be used to describe Friemdan if asked if the entire Keynesian model is an even bigger ponzi.
SANTELLI: I’d just like to know – you know, I was watching that debate last night, although it really wasn’t a debate,” Santelli said. “It was like a weird press conference. But I would like to know – does Mr. Friedman think Social Security is a Ponzi scheme?
FRIEDMAN: No, I don’t think it’s a Ponzi scheme.
SANTELLI: Earlier in the show you said that we’re putting the burden on our kids that’s unsustainable. What’s the definition of a Ponzi scheme?
FRIEDMAN: It’s a program that made promises that it cannot keep in full and it needs to be fixed and reformed.
SANTELLI: Isn’t that exactly what a Ponzi pyramid is?
FRIEDMAN: I don’t think it is a Ponzi scheme as a criminal endeavor.
SANTELLI: No, no – forget the criminal side. You need more people to perpetuate a myth because if the people stop the myth is known to all. That’s my definition of a Ponzi scheme. Let’s call at it chain letter, a pyramid scheme. Isn’t that by definition what Social Security is? Take the legalities and fraud out.
STEVE LIESMAN: Why is it a Ponzi scheme, Rick?
FRIEDMAN: It is pay as we go. Ronald Reagan fixed it. Why can’t we fix it?
SANTELLI: What does Ronald Reagan have to do with my question?
FRIEDMAN: What does your question have to do with reality?
MICHELLE CARUSO CABRERA: We brought it up.
SANTELLI: You can’t decide that more people is the only thing made Social Security work. We have a real issue because many people in government seem to like to read your work.
FRIEDMAN: What makes Social Security work is fixing Social Security in terms of the population demands.
SANTELLI: I didn’t ask if we should fix it or not. I asked if it’s a pyramid scheme.
FRIEDMAN: Your question is idiotic. That’s what you asked.
SANTELLI: You’re idiotic. I’m done. I feel good.
FRIEDMAN: So do I.