SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Politics : The Trump Presidency
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Steve Lokness who wrote (69526)5/2/2018 8:05:07 PM
From: TimF  Read Replies (4) of 353965
 
The government doesn't borrow money from the SS trust fund. Its part of the government. You could say the treasury (or DoD through the treasury) borrows money from the SS trust fund, but "the government" or more specifically "the federal government" is the whole thing including the SSA and the Social Security trust fund.

That point having been made I can rephrase your question to avoid the issue raised above. If the treasury (or perhaps there would be some other more technically correct term, I'll use "treasury" for now) borrows the money from the SS trust fund or from some Chinese investor or the Chinese government, might not matter a lot either way. If (when the treasury was a net borrower from the SS trust fund) it didn't borrow the full amount that the fund had available to lend then the money would be used for some other purpose (assuming the law requiring it to lend all excess funds to the treasury was changed).

If the trust fund get a better return from such investments then what the treasury has to pay for interest, it could be a net positive, OTOH if that's done on a massive scale you could open up the possibility for

1 - Risk

2 - Political favoritism in investment.

3 - Paying an inflated price for areas where the fund does invest because its funneling so much money in to that area. Obviously this would be true for narrow categories of investments (imagine trying to put it all in gold, or even worse in something like fine art), but if with the type of money your talking about even broader categories can have this problem.

If the funds other investments were managed well, very diversified, and while obviously huge were not too huge, than maybe it would make sense. If the treasury wasn't itself in a deficit larger than the SS surplus almost all the time, then that might have to be the way to go. But there are a lot of questions and concerns and its really outside the scope of any point I was trying to make.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News