Social Security - your thoughts?

[Thunder Good-Oil]

You can call it a trust fund if you want to, but it was not set up like a trust fund, it does not work like a trust fund and there is nothing it but IOUs, as Cllnton said those bonds in this so called trust fund are not real assets, they are just "bags of sand"......

Lots of trust funds hold IOUs. They’re called bonds. The trustees have been investing the surplus in debt. US Treasuries.

The purpose of having the two trust funds is to segregate the funds from the rest of federal spending. If it was one pool then there wouldn’t be any “IOUs”.

 

[jmacvols1]

175 trillion? lol wut? over what time span?

thats more than our entire GDP, I am not sure how anything could possibly be underfunded that much.

Medicare and Social Security face $175 trillion shortfall, risking future generations

Medicare and Social Security are in big trouble as it is now underfunded by a staggering $175 trillion, according to a new report from the Treasury Department.

abcstlouis.com

“If you take up the entire economic output of every country on planet Earth, it's about $100 trillion,” he said. “The unfunded liability that U.S. taxpayers face over the next 75 years is $175 trillion.”

 

[jmacvols1]

Lots of trust funds hold IOUs. They’re called bonds. The trustees have been investing the surplus in debt. US Treasuries.

The purpose of having the two trust funds is to segregate the funds from the rest of federal spending. If it was one pool then there wouldn’t be any “IOUs”.

.....then lots of trust funds are worthless. The bonds being issued to the SS Administration are non-negotiable, they have as Clinton said no real assets value for they are worthless pieces of paper being kept in filing cabinets at the Bureau of Debt in WV.....they are 'bags of sand' that represent liability, a debt obligations, not assets.

Misleading the Public: How the Social Security Trust Fund Really Works

As political leaders debate how best to fix Social Security, many policymakers are focusing on the wrong issue. Their sole concern seems to be the date when the Social Security retirement and survivors trust fund will run out of its paper assets. This mistaken emphasis misses the fundamental...

www.heritage.org

"The Social Security trust fund is merely an accounting device filled with IOUs that future taxpayers must repay.

Why the Social Security Trust Fund Differs from Real Trust Funds.

Private-sector trust funds invest in real assets ranging from stocks and bonds to mortgages and other financial instruments. However, the Social Security trust funds are only "invested" in a special type of Treasury bond that can only be issued to and redeemed by the Social Security Administration. As the Congressional Research Service noted in a report on May 5, 1998:

When the government issues a bond to one of its own accounts, it hasn't purchased anything or established a claim against another entity or person. It is simply creating a form of IOU from one of its accounts to another.

According to the Office of Management and Budget under the Clinton Administration in 1999:

These [trust fund] balances are available to finance future benefit payments and other trust fund expenditures--but only in a bookkeeping sense. These funds are not set up to be pension funds, like the funds of private pension plans. They do not consist of real economic assets that can be drawn down in the future to fund benefits. Instead, they are claims on the Treasury, that, when redeemed, will have to be financed by raising taxes, borrowing from the public, or reducing benefits or other expenditures. [Emphasis added.]

In short, the Social Security trust fund is really only an accounting mechanism. The trust fund shows how much the government has borrowed from Social Security, but it does not provide any way to finance future benefits. The money to repay the IOUs will have to come from taxes (Ponzi scheme) that are being used today to pay for other government programs."

 

[Thunder Good-Oil]

.....then lots of trust funds are worthless. The bonds being issued to the SS Administration are non-negotiable, they have as Clinton said no real assets value for they are worthless pieces of paper being kept in filing cabinets at the Bureau of Debt in WV.....they are 'bags of sand' that represent liability, a debt obligations, not assets.

Misleading the Public: How the Social Security Trust Fund Really Works

As political leaders debate how best to fix Social Security, many policymakers are focusing on the wrong issue. Their sole concern seems to be the date when the Social Security retirement and survivors trust fund will run out of its paper assets. This mistaken emphasis misses the fundamental...

www.heritage.org

"The Social Security trust fund is merely an accounting device filled with IOUs that future taxpayers must repay.

Why the Social Security Trust Fund Differs from Real Trust Funds.

Private-sector trust funds invest in real assets ranging from stocks and bonds to mortgages and other financial instruments. However, the Social Security trust funds are only "invested" in a special type of Treasury bond that can only be issued to and redeemed by the Social Security Administration. As the Congressional Research Service noted in a report on May 5, 1998:


According to the Office of Management and Budget under the Clinton Administration in 1999:


In short, the Social Security trust fund is really only an accounting mechanism. The trust fund shows how much the government has borrowed from Social Security, but it does not provide any way to finance future benefits. The money to repay the IOUs will have to come from taxes (Ponzi scheme) that are being used today to pay for other government programs."

90% of revenue to fund Social Security comes from the 6.2% (x2) payroll tax and about 10% from the interest on the past surpluses. If there weren’t the two trust funds then it would all be one pot of money as the 25 year old article written by a guy that’s been dead for 20 years is suggesting.

If anything, Social Security future shortfalls could partially or completely come from the general fund. Not the opposite as is being suggested. The SS trusts haven’t been funding other programs. Buying debt securities with the positive fund balances isn’t giving away trust fund assets.