Is pyramid scheme ethical

Answer 1

Pyramid schemes are only "ethical" if carried out BY government or with government authorization. When a private party or company operates a pyramid scheme it usually results in "running out of prospects." The scheme usually involves getting one "sucker" who then gets 10 "suckers" (that gets them their investment back and some profit) who then each get another 10 "suckers", ad infinitum - until there are no "suckers" left to get. It only takes a bit of calculation to determine that within just 8 levels you will have involved 100 million "suckers" - and they account for one-half of the adult population of the U.S.A. The Social Security system works like a pyramid scheme (more likely a Ponzie Scheme) in that when it was started in 1937 there were 30 people paying into the system for each person collecting. Today (even after the top limits of taxable contributions have been raised) there are an estimated two people contributing for every one collecting. That, even with government sanctions, is a Pyramid Scheme and it is NOT ETHICAL!