re: #116 FurryOldGuyJeans

For the history of SS there were more monies coming in than being returned to recipients. Any excess was used to fund other programs with IOUs given. Soon the IOUs will come due and more people get payments than there are payees into the system.

Yep, that’s exactly right. Here’s the answer to a question on that, from the SSA’s own site:

Social Security Administration

How are the trust funds invested?

By law, income to the trust funds must be invested, on a daily basis, in securities guaranteed as to both principal and interest by the Federal government. All securities held by the trust funds are “special issues” of the United States Treasury. Such securities are available only to the trust funds.

In the past, the trust funds have held marketable Treasury securities, which are available to the general public. Unlike marketable securities, special issues can be redeemed at any time at face value. Marketable securities are subject to the forces of the open market and may suffer a loss, or enjoy a gain, if sold before maturity. Investment in special issues gives the trust funds the same flexibility as holding cash.

No matter how they want to “blow smoke”, the reality is that the money has been “borrowed” and secured by either “special securities” or “Treasury securities”. In other words, by IOU’s from Treasury.

And to pay it back? Hm, would need to increase tax revenues, borrow money, or print dollars.