General Discussion
In reply to the discussion: Stop it, stop saying Social Security needs reform, you are a Democrat, right? [View all]magellan
(13,257 posts)Isn't this where the IOUs come into play? The surplus money is converted into T-bonds, and the government borrows against those to fund its whims. Right now there's nearly $3 Trillion in surplus SocSec payments, converted into T-bonds, that the government has borrowed against, and at some point it'll have to start paying that back, with interest, in order for SSA to cover the baby boomers retiring (which is ostensibly why the payroll tax was increased by Reagan in the first place).
The problem is, they don't want to have to pay back what they've borrowed. Hence the "crisis" with SocSec. It's completely manufactured, just a convenient way to shift the blame for reckless spending by the Repubs on wars and tax cuts to SocSec by claiming it's costing the government too much. Which is a lie. That's OUR money they borrowed and spent as if it were general revenue.
At least that's my understanding of it.