Skeeter Bug, re: SS. Been lurking today and had to butt in. <g>
Ever since LBJ decided to use the SS surplus to help pay for the Vietnam war, the SS surplus has been transferred to the General fund of the Treasury.
From the SSA web site:
What happens to the taxes that go into the trust funds? Tax income is deposited on a daily basis. That part not immediately needed to pay benefits or administrative expenses is invested by purchasing "special issue" securities. The cash exchanged for the securities goes into the general fund of the Treasury and is indistinguishable from other cash in the general fund.
ssa.gov
For all these years the annual SS surplus has been spent on Infrastructure, Military, Welfare, Pork Barrel's, etc. In effect a higher tax rate. True, the Government has issued "Special Issue" securities" to the SS Fund, (basically low interest bearing bonds), but at some point in time they will have to be redeemed.
According to the Government, investments held by the trust funds are backed by the full faith and credit of the U. S. Government. Interpretation, when the bill comes due we're going to have to raise general taxes or cut benefits.
It would be interesting to know what the impact on the U.S. would have been had there been a "Lock Box" on the surplus. We would have had either higher tax rates, a higher deficit, or lower spending.
But there would be a heck of a lot more money in the SS fund. (I think the SS currently holds ~$1 trillion in securities).
JMHO's |
