It seems a lot closer to a ponzi scheme than a pyramid scheme.

I do believe if I was funding an IRA/ROTH-IRA with that money I would be much better off. However, we are not funding OURSELVES, we are funding those who came before us. And while we may not get our payout (may not be funded my those who come after us) the fact is that those being funded right now deserve what they are getting. It's pretty selfish to just say 'if it isn't helping me, why should I care?'