Social Security to start cashing Uncle Sam's IOUs

[Kadie]

Social Security to start cashing Uncle Sam's IOUs

By STEPHEN OHLEMACHER, Associated Press Writer Stephen Ohlemacher, Associated Press Writer – Sun Mar 14, 9:46 am ET

PARKERSBURG, W.Va. – The retirement nest egg of an entire generation is stashed away in this small town along the Ohio River: $2.5 trillion in IOUs from the federal government, payable to the Social Security Administration.

It's time to start cashing them in.

For more than two decades, Social Security collected more money in payroll taxes than it paid out in benefits — billions more each year.

Not anymore. This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.

Sounds like a good time to start tapping the nest egg. Too bad the federal government already spent that money over the years on other programs, preferring to borrow from Social Security rather than foreign creditors. In return, the Treasury Department issued a stack of IOUs — in the form of Treasury bonds — which are kept in a nondescript office building just down the street from Parkersburg's municipal offices.

Now the government will have to borrow even more money, much of it abroad, to start paying back the IOUs, and the timing couldn't be worse. The government is projected to post a record $1.5 trillion budget deficit this year, followed by trillion dollar deficits for years to come.

more...
http://news.yahoo.com/s/ap/20100314/ap_on_bi_ge/us_social_security_ious

[Skink]

1. Looks like we'll have to raid the Military budget.

[DrDan]

2. $29 Billion sounds like a lot . . . but

it is still only about 3 months of our current war effort. Congress has no problem authorizing that money. I expect no problems in SS funding.

[mikehiggins]

3. opening gun

so now the issue is going to be pay off the SocSec loans and then have to raise taxes, or renege on those obligations and still raise taxes to pay for Iraq, Afghanistan, etc., etc. and so forth. And the US worker will take it up the butt as usual.

Its almost beautiful, this dance to put all the money in increasingly fewer hands...