Thinking about my earlier post, “fixing” social security would NOT involve diverting the equivalent 3.1% of the GDP. Only a portion of the GDP (income earned from work up to $127,500) is currently subject to FICA tax
It’s still a big chunk of change, just not as big as I had stated.
You are correct that the SS trust fund does exist, and interest is paid on the money Congress borrows from it.
That said, the Fed Res. board has long been in the game of “lowering intetest rates,”
-and-
trust fund borrowing is long term but the interest rate Congress pays is based on a combination of long and short-tetm rates. Thus interest payments paid into the SS trust are not free market rates, they are artificially lowered TWICE.
The government is trying to claim something as an asset that is countered by a matching liability on its own books. Only one entity is involved.
You represent a second party in your own dealings with the government.
To be comparable to something YOU might try imagine walking into a bank with a bond that your right hand had issued to your left hand and claiming to a bank officer that it was an asset (ignoring that your left hand is technically holding the matching offsetting liability) and could you please borrow some money against it.
Ok. Thanks for your interpretation. Now let’s get back to stark reality. Are the t-bills the social security administration holds any less valuable than the ones that I hold?