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View Diary: Journalmalism strikes again in Social Security reporting (80 comments)

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  •  Trust fund? (0+ / 0-)

    You all know that the trust fund is a shell game right? There is no account somewhere that holds all this money. The surplus money is used to purchase US Bonds, and then spent as part of general funds. Its a great big IOU from one part of the government to another.

    To put it more simply, part of the trillions of dollars we owe to China we also owe to Social Security. As the Fed tries to reduce our debt burden though "Monetary Easing," aka printing money, we are also reducing the value of the "Trust Fund." As we try to inflate away our debt, we also inflate away the trust fund, which is why it is running out sooner than previously stated.

    The real ugly part is that as the number of retirees increases the amount of "surplus" Soc. Sec. funds that are converted into bonds and spent as "general funds" decreases. Putting a lever increasing burden on our budget.

    Now in a few more years not only will those "surplus" SS funds be gone and that money will not be available for the general fund, BUT the Soc Sec income will actually be smaller than the Soc Sec payments that need to be made. Which means they will have to tap the "Trust Fund." How do we tap the trust fund? The Soc Sec Admin starts cashing in bonds. Where does that money come from? The general account. And we will have yet another NEW bill for the government to pay.

    It is as if its a double negative on the cash flow of the government. Not only will the surplus not be there to feed the bloated government, but it will be time to pay up for orgy of spending that has been going on with the trust fund money for the last however many decades. So we will have lost one source of income and replaced it with a bill instead.

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