This is almost a form of a Ponzi scheme....

You might have a bit more credibility if you refrained from using absurd terms like Ponzi.  I am sure there must be some kind of financial Godwin's Law equivalent when the Ponzi card is played.

A company that issue shares in lieu of cash payments to a shareholder is able to retain that cash to reinvest in the company.  Resulting in the ability to fund capital inputs leading to further cash flow growth.  Clearly it is up to the shareholder to decide if they feel the company is deploying their capital in the most efficient manner.  

Alternatively they could go directly to the market, or a banking syndicate to fund those needs incurring significant costs in the process.