Wednesday, May 13, 2009

There is no Social Security Trust Fund

Here's a quick follow-up to my previous blog re non-existent Social Security Trust Fund. A recent Atlantic Monthly article pointed-out that the "trust fund" actually consists of nothing more than a filing cabinet full of (worthless) Treasury Bonds.

Which led me to this 2005 story in USA Today,

I understand that the government faces a difficult situation:
How do you 'bank' or otherwise invest the excess income (which is really just a loan) from Social Security? 'Investing' in the government's own bonds, however, seems misleading -- if not illegal or even treasonous!

I wish there were a way of forcing the federal government to:
  1. Stop buying Treasury bonds
  2. Remove the SS overpayments from the federal budget, i.e., so they weren't being used to paper-over deficit spending
Maybe they could use the SS money to buy gold or oil reserves, or something else that would represent a long-term (>20 years) investment?

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