This correspondent recently shared a classroom lectern with a left-of-center partisan who told a group of college students that they should not consider Social Security an expensive government entitlement program. “I’ve paid money for years into Social Security, and when I reach retirement age, I will be getting my money back.”

I was too polite to laugh and too cheap to offer my interlocutor a subscription to Barron’s, which would have offered her regular, written reminders of just how wrong she is. Editorial page editor Thomas Donlan explains to readers this week that Barron’s pinpointed the key problem with Social Security 77 years ago, when the program was still in its infancy.

One refinement that can extend the life of a Ponzi scheme was used most famously by Bernard Madoff. Rather than paying generous dividends in cash, Madoff simply made false entries in his reports to clients, showing them that their money was growing rapidly. For decades, this security reduced their demand for cash to something less than his fund’s actual cash flow, and he survived to be known as a financial wizard.

As [editorial writer Bernard] Kilgore reported in 1936, Social Security does the same thing. The Treasury collects Social Security taxes on behalf of the Social Security program. It also writes the program’s checks to beneficiaries. When the taxes received exceed the benefits paid, the Treasury uses the excess money for other government purposes and writes IOUs, also known as Treasury bonds, showing that it owes the money to Social Security and will come up with it when needed. Social Security also earns interest on the money the Treasury has borrowed, and the Treasury pays it with more bonds. The Treasury is now more than $2.5 trillion in debt to Social Security.

Despite all this, politicians have always presented Social Security as a savings program, in which people pay taxes set aside for them to provide themselves retirement income and disability insurance. But as editorial writers, economics columnists, and guest feature-writers here have been saying almost annually since Kilgore’s 1936 report, that aspect of Social Security has always been fraudulent.

The money goes out as fast as it goes in—or faster. Participants have at best a moral claim on Congress to fund their future benefits. At worst, they have no claim at all, since Congress reserved the power to change the terms of Social Security benefits, and its power to break promises has been confirmed by the U.S. Supreme Court.

There are many who believe that Social Security is safer than other Ponzi schemes because the government runs it. It’s true enough that Social Security runs on tax revenue instead of voluntary deposits. Wage-earners and their employers must make their deposits, and those taxes can be increased if Congress prefers not to renege on its promises. It’s also true enough that Congress has indeed raised taxes and reduced promised benefits in order to keep the system roughly in balance most of the time.

But the U.S. has a population of retirees that’s growing faster than the economy and faster than the working population. The costs of Social Security and what’s more, the costs of the retirees’ Medicare benefits, far exceed the taxes dedicated to pay them.