Three-Card monte politics

by: Paul Rosenberg

Wed Sep 22, 2010 at 12:00

This past weekend, conservative activists and Tea Party groups gathered in Chicago for the Right Nation 2010 convention. Among those who attended was former House Majority Leader Dick Armey, the chairman of one of the original Tea Party groups, FreedomWorks.

During the event, ThinkProgress sat down with Armey at a blogger's roundtable. No sooner than we took our seats did Armey come out guns-blazing against Social Security. He called it a "corrupt government practice" that steals people's money "under false pretenses." He went on to call Social Security a "Ponzi scheme":

ARMEY: The government uses the concept of a trust fund to take your money under false pretenses. For years, I wrote about and talked about and taught about what I call 'corrupt government practices,' because they're always so quick to talk about corruption. One of the corrupt government practices is stealing your money under false pretenses. I'll give you a to wit: social security. When they had the Alan Greenspan commission, they knowingly raised payroll taxes more than what was necessary to meet the flow of output. Social Security is a pay-as-you-go Ponzi scheme. They knew very well that the extra $250 billion would be spent on their social schemes.

Of course a politician who's lived in corruption all his life would naturally accuse everyone else of corruption.  It would only be shocking if he didn't.

Still, it's deeply ironic, to say the least, that conservatives like Armey have been slandering Social Security as a "Ponzi scheme" for 20 years or more, now, when they themselves have been the ones opening the floodgates for Ponzi schemes all along.  Although Bernie Madoff & others like him were only the icing on the cake of the 2007 financial collapse, it was the very same deregulatory policies that caused the crash that also gave Madoff free reign.

Furthermore, there was a distinct similarity between outright Ponzi schemes and the basic logic driving the markets that took over as the housing bubble took off--what Hyman Minsky referred to as "Ponzi unit" investment in his financial instability hypothesis (discussed here) which cannot cover either principle or interest and ultimately relies on expected profits from asset inflation to pay for an investment.  But even more than the Ponzi scheme, what characterizes conservative economic policy and politics is the conceptually similar but much, much cruder scheme involving money and deception known as Three Card Monte.  Wikipedia explains:

Three-card Monte, also known as the Three-card marney, Three-card trick, Three-Way, Three-card shuffle, Menage-a-card, Triplets, Follow the lady, Les Trois Perdants, Find the lady, or Follow the Bee is a confidence game in which the victim, or mark, is tricked into betting a sum of money, on the assumption that they can find the money card among three face-down playing cards.

In its full form, Three-card Monte is an example of a classic short con in which a shill pretends to conspire with the mark to cheat the dealer, while in fact conspiring with the dealer to cheat the mark.

This confidence trick was already in use by the turn of the 15th century,[1] having a great deal in common with the shell game; they are the same except that cards are used instead of "shells"....

Rules

The three-card Monte game itself is very simple. To play, a dealer places three cards face down on a table, usually a cardboard box which provides the ability to set up and disappear quickly.[3] The dealer shows that one of the cards is the target card, e.g., the Queen of Hearts, and then rearranges the cards quickly to confuse the player about which card is which. The player is then given an opportunity to select one of the three cards. If the player correctly identifies the Queen of Hearts, the player wins an amount equal to the amount bet; otherwise, he loses his stake.

Drawing a player in

When the mark arrives at the three-card Monte game, it is likely that a number of other players will be seen winning and losing money at the game. The people engaged in playing the game are invariably shills, confederates of the dealer who pretend to play so as to give the illusion of a straight gambling game.

As the mark watches the game, they are likely to notice that they can follow the queen more easily than the shills seem to be able to, which sets them up to believe that they can beat the game.

Eventually, if the mark enters the game, they will be cheated through any number of methods.

The essence of all the methods is the same, however: to confuse and distract the mark from knowing where money card is.

So how does this apply to Armey and his ilk?