Dear Senator Edwards: Here’s a Financial Fraud

By June 25, 2007General

Democratic presidential candidate John Edwards is proposing “a regulatory commission to protect consumers from dangerous financial products?” Well, then, says George Mason University economist Don Boudreaux, let’s start with ….

22 June 2007

Ms. Clara Perez
www.democracyjournal.org

Dear Ms. Perez:

Thanks for your e-mail alerting me to Presidential-hopeful John Edwards’s proposal to create “a regulatory commission to protect consumers from dangerous financial products.”

If such a commission does its job, I suggest that the first dangerous financial product that it attacks be Social Security. Not only are Social Security’s returns lousy; not only are its “customers” never vested their “contributions”; not only does the institution providing it have no sound plan to keep it solvent; not only does this institution intentionally mislead its clients about its insolvency (witness its discussions of the illusory “trust fund”) – but its “customers” are forced to buy it. That is a dangerous financial product!

Sincerely,
Donald J. Boudreaux
George Mason University

Hat tip: Pejman Yousefzadeh.

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