According to today's accounting rules, any legal entity with a wholly-owned subsidiary that declares "assets" that are debts of that same entity, or another wholly-owned subsidiary, has committed a major no-no. Wholly-owned subsidiaries are supposed have their books consolidated with the parent's.
By that standard, SSA has no assets. Also, the Treasury securities issued to SSA don't exist as real liabilities.
Someone could muddy the issue and say that SSA isn't like a wholly-owned subsidiary because it isn't owned, but the lines of authority make it clear that it's a subsidiary of FedGov. The Treasury is under the President; so is the SSA. Their top bosses both serve at pleasure of the President of the United States. By the pragmatists' duck criterion, SSA is a de facto wholly-owned subsidiary of the U.S. government by the lines-of-authority test. So is Treasury. Thus, they should be consolidated.
Seen in this light, there's a better analogy for Social Sercurity: Enron.
I should note that applying the consolidation rule means that Treaury debt is significantly lower than the stated total. Debt held by SSA shouldn't be counted in the total. That means the total funded debt load of the U.S. government isn't 100% of GDP; it's more like 70%. Of course, the unfunded liabilities (using the moral-obligation standard) are much higher.
The legal claim held by SSA is much stronger and can only be restructured by a vote of congress, not the executive as in most business entities.
Because the claim is stronger than a normal subsidiary, I think the SSA Trust Funds should be treated as a separate entity. And that the treasury should report the debt. And SSA should report the unfunded liabilities as well as the trust fund growth projections.
That would put pressure on SSA to do better reporting on the status of their trust fund vs projected liabilities than they do today. And it would put pressure on Congress to bring down the total debt.
Perry is not wrong, it does resemble a ponzi scheme because the trust fund is not large enough to cover the liability that was incurred. And they are using way too much of current SSI taxes just to pay the liabilities incurred yesteryear.
The Treasury debt to SSA is reported as footnotes to the financial statements. And of course SSA's separate entity report shows it in full.
You can see a report on the SSA trust fund here.
SSA Trust Fund Data
SSA Trust Fund
SSA Trust Fund Outlook
The fund is sitting on $2.4 Trillion in Debt owed to it by the U.S. Treasury. SSA currently pays out $585 Billion a year in benefits, so the trust fund is sufficient to cover 4 years, if they stopped the program today. In My opinion it needs to be at least 15 x current benefits, just for those already retired.
I think they should actually split the OASI trust fund into three parts. Survivors Insurance should be it's own fund. And then the SSA fund needs to be split into an endowment for those retired. And an endowment for those still working. When someone retires, they should shift an appropriate amount of funds from the working fund to the retirement fund.
It makes no sense to report the way SSA does now that the trust fund is 400% of current outlays.