Why Did Bernie Madoff Go To Prison?

To make it simple, he talked people into investing with him. Trouble was, he didn’t invest their money. As time rolled on, he simply took the money from the new investors to pay off the old investors.

Finally, there were too many old investors and not enough money from new investors coming in to keep the payments going. Next thing you know, Madoff is one of the most hated men in America and he is off to jail.

Madoff did to his investors what the government has been doing to us for over 70 years with Social Security. There is no meaningful difference between the two schemes except that one was operated by a private individual who is now in jail, and the other is operated by politicians who enjoy perks, privileges, and status, in spite of their actions.

Do you need a side-by-side comparison here?




Takes money from investors with the promise that the money will be invested and made available to them later.

Takes money from wage earners with the promise that the money will be invested in a “Trust Fund” (Lock Box) and made available later.

Instead of investing the money, Madoff spends it on nice homes in the Hamptons and yachts. Instead of depositing money in a Trust Fund, the politicians transfer it to the General Revenue Fund and use it for general spending and vote buying.

When the time comes to pay the investors back, Madoff simply uses some of the new funds from newer investors to pay back the older investors.

When benefits for older investors become due, the politicians pay them with money taken from younger and newer wage earners to pay the older geezers.

When Madoff’s scheme is discovered, all heck breaks loose. New investors won’t give him any more cash.

When Social Security runs out of money, the politicians try to force the taxpayers to send them some more, or they cancel S/S to all those who paid into it.

Bernie Madoff is in jail.

Politicians remain in Washington… with fat medical and retirement benefits.

About Fredda Jones

Fredda Davis Jones was raised “in the country” in Comanche County and learned very early that creativity and innovation are traits that can flourish even in small-town Texas and that with enough effort, indeed nothing is impossible, including being married to the same man for over 40 years! Rickey and Fredda have 2 children, 5 grandchildren, and a crazy life that includes sitting in the bleachers several times a week. The rest of her time is spent creating great content for texansunited.com and marketing small-town Texas.
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4 Responses to Why Did Bernie Madoff Go To Prison?

  1. Connie says:

    The government has been running the largest Ponzi scheme that has ever existed. If an individual or a business operated the way they do, they would most undoubtedly go to prison, as they should.

  2. Sam Vineyard says:

    I never thought of it in that light before, but it sure looks like the same thing to me. I can remember my dad talking to other in the 50’s about the government “borrowing” some money form the SS fund since it had so much in it. Then in the late 60’s they just moved the whole thing over into the general fund to use where ever they wanted. (Some say it was never put into a special fund, but I am just going by what my dad had said) In the past week I have gotten some emails in that people want a new contract with Congress, some of them want a new Ammendment to the Constitution, with term limits, no retirement for Congressmen or Senators, ect. I just send it back to them saying, it will never happen. To get that done someone in Congress will have to write the bill and run it through Congress and who in Congress would ever cut their own throat and do any such thing?

  3. Dennis Marken says:

    The state calls its own violence law, but that or the individual, crime.

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