Greetings! Been doing a lot of research on social security in order to establish a one stop diary re truths, lies, etc.
During my investigations the following statement has been found to be true.
There is no money in the social security trust fund.
I know, you've heard it all before in a number of ways by any number of people just like me.
Do you know what all of these people have in common?
President Bill Clinton, former Secretary of the Treasury, and former Social Security trustee, Paul O'Neill, June O'Neill, former Director of the Congressional Budget Office (CBO), Barry Anderson of the Congressional Budget Office, Robert Matsui (D-CA), Chairman House Ways & Means Subcommittee on Social Security, House Budget Committee Chairman Nick Smith, Newt Gingrich, Senator Ernest "Fritz" Hollings (D-SC), Walter Williams, Professor of Economics,
George Mason University, Thomas Sowell, Senator Peter Fitzgerald (R-Illinois), etc.
They have confirmed the statement, "There is no money in the social security trust fund."
One may doubt me or argue validity whenever I issue a statement but it's a bit awkward arguing with the President of the United States of America or with a former Secretary of the US Treasury.
"Trust Fund balances are available to finance future benefits...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 or borrowing." President Bill Clinton in his Analytical Perspectives section of the 2000 budget.
"We have no positive assets in the Social Security Trust Fund." Secretary of the Treasury, and one of the Social Security trustees, Paul O'Neill, June 19, 2001, at a luncheon speech to the Coalition for American Financial Security in the Sky Room of the World Trade Center and later to Sam Donaldson on This Week, Sunday, June 25, 2001.
"It holds no real assets. Consequently, it does not generate funds to pay future benefits. These so-called trust fund 'assets' simply reflect the accumulated sum of funds transferred from Social Security over the years to finance other government operations." June O'Neill, former Director of the Congressional Budget Office (CBO)
"Government trust funds do not correspond in any meaningful way to those in the private sector. Government trust funds are simply a form of earmarking, accounting mechanisms that record tax receipts, user fees, and other credits and associated expenditures," Barry Anderson of the Congressional Budget Office
"It means that ordinary working Americans, like teachers, police officers and firefighters, who believe their payroll taxes are going toward their Social Security retirement are in for a surprise...Instead of going to the Social Security trust fund, their payroll contributions are being funneled directly into tax breaks for individuals and corporations" Robert Matsui (D-CA), Chairman House Ways & Means Subcommittee on Social Security
"It is in this role as a savings account that the Trust Fund could fail. It cannot work because it holds no independent assets. Though the Trust Fund is backed by government securities, these have a different meaning than they would for you or me. If I hold a government bond, I have an asset that the government will give me money for or that I can sell at any time. If the government holds a bond, however, its obligation to give itself money is meaningless. The government cannot make these bonds good, as needed in 2014, except by borrowing, reducing other expenditures or taxing citizens." House Budget Committee Chairman Nick Smith
"In fact, the money the government has supposedly been putting aside from the Baby Boomers' Social Security taxes is not there. The government has been borrowing the money to pay for the budget deficit. The Social Security Trust Fund is simply IOUs from the U.S. Treasury.... [Social Security] would be fine if the government would stop borrowing the money." Newt Gingrich
"The truth is that the Social Security Trust Fund has already been stripped bare. There is no trust and no fund. It is a lot like the S&Ls. The savings and loans had a lot of real estate on the books, a lot of property, a lot of shopping centers, a lot of deposits, and everything else, until you looked inside and found out there was nothing there. The assets were mostly on paper.... Meanwhile, the Social Security cupboard is bare." Senator Ernest "Fritz" Hollings (D-SC)
"The Enron case made headlines because fraud and deception of such magnitude is fairly unusual in the corporate world. Washington fraud and deception of a much greater magnitude doesn't make the headlines because fraud and deception in government is standard practice....Washington politicians have for decades been doing precisely what Enron has been accused of doing -- concealing debt with accounting tricks. Congressmen tell us that our Social Security taxes go into a trust fund to pay for future retirement pensions. That is a boldface lie. The Social Security trust fund has no money in it." Walter Williams, Professor of Economics, George Mason University
"When the money going out exceeds the money coming in, you are in trouble and that happens in 2016. Those who try to push the fatal date off to 2038 are counting the money that Social Security has in its so-called trust fund. However, the so-called trust fund exists only as a legal technicality, not as an economic reality...you cannot spend and save the same money." Thomas Sowell, The Washington Times, July 29, 2001
Senator Peter Fitzgerald (R-Illinois) on the Senate floor during lock-box debates, 1999: "A few years back Congress passed laws making it illegal for State and local governments to plunder the pension funds of their employees. But during all this time, where Congress has put these laws on the books and made it illegal in the private sector and at the State and local government level to plunder pension funds, we have gone on and on in Washington taking all the money that goes into the Social Security trust fund, taking every dime of it out, and spending it on some other program. As a result, as I speak now on the Senate floor, there is no money in the Social Security trust fund. All of it has been taken out and spent on other programs. They have put meaningless, nonmarketable, nonnegotiable securities in the Social Security trust fund, securities that have no economic value because they cannot be sold to raise cash. Right now our Government is building up, theoretically, surpluses in the Social Security trust fund, but they are taking all that money out and spending it. So when we actually need it to pay benefits, beginning in the year 2014, there will be no money there. No matter what the balance of those bogus IOUs is in the Social Security trust fund, in the year 2014--whether that balance is $1 trillion or $5 trillion--they are of no assistance in paying benefits to those who depend on Social Security. The country will either have to raise taxes or cut benefits to make up for the shortfall that is anticipated after the year 2014. This legislation is basic, decent common sense. We should not allow Congress to continue frittering away the Social Security trust fund. I urge all my colleagues to support it and end this outrageous practice of plundering the Social Security trust fund, to the detriment of our Nation's seniors and those who will be desiring to live on Social Security benefits in the next century."
I have a ton of confirmations and some of those will be inserted in later diaries for different reasons.
While I did state there was no money in the trust account that doesn't mean benefits won't be paid. Two very different subjects which we all seem to confuse.
In the next diary we'll examine other myths, lies, etc.