Social Security: Stealing the World's Largest Bank Account

[Nye Bevan]

13. There is no "money" in the "trust fund". Every penny has already been spent.

Discussing how we will raise money to pay SS benefits in the future, when the benefits being paid out will exceed the payroll taxes being paid in, is essentially the same as discussing how we will raise the money to redeem the IOU's in the "trust fund".

As the Office of Management and Budget put it:

These [Trust Fund] balances are available to finance future benefit payments and other Trust Fund expenditures – but only in a bookkeeping sense.... 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. The existence of large Trust Fund balances, therefore, does not, by itself, have any impact on the Government’s ability to pay benefits. (from FY 2000 Budget, Analytical Perspectives, p. 337)

http://en.wikipedia.org/wiki/Social_Security_Trust_Fund

See also:

I have been trying to expose the Social Security scam for more than a decade, now, with little cooperation from the media, until very recently. But the tide is turning. My first big break came when Allan Sloan, Fortune’s Senior Editor at Large, quoted me and referred to my book in his August 10 Washington Post column. I’m sure Allan shocked a lot of people with that column. And he became the first major media person to reveal the dark secret that the government has managed to keep hidden for 25 years.

Below is an excerpt from that column.

"Let me show you in two different ways how useless the fund is. The first is a quote from the introduction to the 2009 Social Security trustees report, the second is the graphic by my Fortune colleague Robert Dominguez that accompanies this article. Allen Smith, economics professor emeritus at Eastern Illinois University and author of “The Big Lie: How Our Government Hoodwinked the Public, Emptied the S.S. Trust Fund, and caused The Great Economic Collapse,” spotted the 2009 quote, and it is telling. It says: “Neither the redemption of trust fund bonds, nor interest paid on those bonds, provides any new net income to the Treasury, which must finance redemptions and interest payments through some combination of increased taxation, reductions in other government spending, or additional borrowing from the public.

In other words, the trust fund is of no economic value. This sentence wasn’t in the 2010 introduction, released last week. Treasury says that it stands by the statement but that the Social Security trustees decided not to include it this year because it reiterates the obvious."

Once Allan Sloan broke the ice, and reported on a subject that has been taboo for two decades, he was followed by other journalists. Below are excerpts from the Social Security writings of three mainstream journalists who have recently joined the effort to expose the awful truth about the trust fund.

"Doesn’t the Social Security trust fund cover that? No, silly. All those years of surplus in Social Security were recorded in a book entry dubbed the “trust fund”, but the non-marketable special Treasury bonds that make up the fund don’t represent any assets that can be cashed in to pay benefits".

— Eric Schurenberg from CBS Money Watch, August 19, 2010

"Your payroll taxes go into a bottomless hole. So where did all that FICA money go? Down the drain of federal spending on everything. It’s certainly not sitting in an account waiting to pay your retirement benefits."

— Terry Savage, Chicago Sun-Times, September 6, 2010

http://dissidentvoice.org/2010/09/the-awful-truth-about-the-social-security-trust-fund-is-beginning-to-emerge/