Ponzi, Madoff, Obama: Masters of disaster

Wait a minute! Don't jump to conclusions … this isn't a "hit piece," a partisan political screed. This is a reasoned, rational, objective comparison of three protean figures who experienced heady, exhilarating success, only to crash and burn when the foundation on which they built that success could not support or sustain it.

First, to Wikipedia, the free encyclopedia. Most people, perhaps like you and me, know in general what a "Ponzi scheme" is, that it's some kind of scam in which somebody fools a lot of people into thinking they're going to become rich, but instead lose their shirts. And that's true, in general.

But you need to know more fully what a Ponzi scheme is.

Here's the best definition I've come across: a fraudulent investment operation that pays returns to its investors from their own money – or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation.

The Ponzi scheme usually entices new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent. Perpetuation of the high returns requires an ever-increasing flow of new investors to keep the scheme going.

The system is destined to collapse, inevitably – because the earnings, if any, are less than the payments to investors. Usually, the scheme is interrupted by legal authorities before the certain collapse – because as more investors become involved, the likelihood of the scheme coming to the attention of authorities increases.

Do you see it? The moment more people are standing in line to get the "easy money" from their investments, with their hands out in expectation – with fewer new dupes lining up to pour more money into the proposition – the whole thing is doomed.

But it was doomed from the beginning. It was built on a fraudulent fantasy.

In the 1920s, Charles Ponzi actually promised new investors a 50 percent return in 45 days, and a likely 100 percent return in 90 days! And as long as gullible new investors kept pouring money into Ponzi's pockets, he kept doling out new payments to the earlier investors, and they brought in more new suckers. Eventually, heady with his own success, he was promising 400 percent returns and more, assuming the new suckers would keep coming in ever greater numbers.

Incredible? Of course. It was incredible, and it crashed, bankrupting Ponzi and most of his suckers, and sending him to prison.

Then, just a few years ago, along came Bernie Madoff.

Like Charles Ponzi, Bernard Madoff actually had a generally respectable financial career before his grand fraud took shape. He was the non-executive chairman of the Nasdaq stock market and founder of his own firm, Bernard L. Madoff Investment Securities LLC, from its startup in 1960 … until his arrest Dec. 11, 2008.

But somewhere along the line, he realized he could sell wealthy individuals and major philanthropic foundations on his mysterious ability to make them wonderful profits, if they would just give piles of money to him and trust him to manage it. And they did! Intelligent people, experienced managers and chairmen of important charities turned billions of dollars over to Bernie Madoff, and sat back unquestioningly, waiting for 100 percent profits, or better.

For a few years, as the monies under his management grew to an estimated $65 billion, Bernie kept almost half his investors happy by feeding partial returns back to them, keeping later investors waiting. He wasn't investing their money in anything except huge bank accounts out of which he doled some returns to the most impatient clients. And for a few years, he was the toast of the financial community, living lavishly, buying estates and yachts and giving generously to many worthy causes.

But the day of reckoning came. Finally – and inevitably – the huge demands for returns outstripped the incoming new investments. The whole fantastic scheme imploded, the law descended on hapless Bernie, and he was sentenced to 150 YEARS IN JAIL! He'll be there till he dies.

What's the point of all this? My friends, my poor deluded fellow Americans, the current occupant of the White House makes these charlatans, two of the biggest swindlers in human history, look like small-time side-show barkers or street hustlers.

A charmer he can be, for sure, and a very capable reader of written scripts on teleprompters. He's evidently becoming a practiced golfer and has a good three-point basketball shot. He and his wife and two daughters look very nice on stages and are excellent symbols of the increasing colorblindness and lack of prejudice in these United States.

But Mr. Obama came to the presidency with absolutely no experience in the qualities demanded of the office. He never ran a business of any kind, and has no grasp of finance, let alone our giant, complex economy. Personally, I doubt he could successfully run a 7/11 or Starbucks. That takes a sense of budget, cost accounting and stocking what customers want and will buy. No businessman can decide what the customer must buy and what he must pay for it. That's what our founders called "taxation without representation."

That concept brought on our American Revolution. We wouldn't stand for it then. And we've got to reject it now.

Look objectively at what's happened. This White House team has taken over two of our Big Three automakers, big banks and our whole health-care system, saddling you and me and our descendants with bankruptcy, squandering trillions of paper dollars that are just that – paper – with no substance to give them value. Billions have been spent on hopeless energy boondoggles like Solyndra, created by a big Obama donor.

And for the last four years, while flying all over the country in Air Force One attending, at last count, over 120 major fundraisers for his re-election campaign, he has snake-charmed the Congress into piling over $6 trillion of unpayable debt on American taxpayers, now and into the foreseeable future. Added to the previous debt, that's over $50,000 of liability for every man, woman and child in the country. If re-elected, he intends to significantly add to that burden!

Move over, Ponzi and Madoff – Mr. Obama has made you look like amateurs.