You are confused.
The government has two sources for revenue at any moment in time, current taxes and current borrowing.
Over the next thirty years there will be certain Social Security payments made to those Americans who are presently age 50 or over (say) and are eligible, or soon will be eligible to receive Social Security retirement benefits.
Whatever benefits those future recipients collect will be funded (just as all other government outlays are funded) by future taxes and future borrowing.
The impact on the economy and on the future taxpayers of those future Social Security benefits is entirely unaffected by the imaginary existence of an imaginary trust fund. The U.S. Treasury can have a big box of U.S. Treasury bonds or it can have a big box of make-believe unicorn turds, it doesn’t matter.
The past is the past. There is no trust fund. And there is a huge slug of Americans at or near retirement age for whom there have been no actual assets (e.g. cash, gold, securities, etc.) set aside to cover their future Social Security retirement benefits.
Those benefits, whatever they are, will be funded by future taxpayers.
I'm not confused at all. You are correct up until you say that there is no trust fund. Then you become confused.
From SSA's standpoint they have assets. They have a box full of U.S Treasury bonds. Just like China has a box full of U.S. Treasury bonds. It's an asset. And it's appropriate to say that SSA has assets just like it's appropriate to say China has assets.
SSA has assets. It's the U.S. Treasury that doesn't have assets. The U.S. Treasury has a boatload of debt that it's going to have to pay on. Either through tax revenues or rollover borrowing. That doesn't change the fact that SSA has assets and those assets have value.
Now neither of us like the fact that congress has directed the U.S. Treasury to borrow and spend all of this money. But that's not SSA's problem. To say SSA doesn't have assets, is equivalent to saying that Ford Motor Credit doesn't have an asset, just because all they have is a note from you, and you don't have a lot of cash. You've got earning power and Ford Motor Credit will collect on that note. Be assured SSA will collect on that note from the U.S. too. The U.S. is not going to default on the debt owed to the SSA. It will be paid.
Your last comment is true. Taxpayers are on the hook for all the funds that the treasury has borrowed. The U. S. treasury either has to tax to pay it's debt or it has to issue more debt. And that's whether it was borrowed from SSA or from China.
The problem with your comments, is that it is neither true or appropriate to say that there is no SSA trust fund. Clearly SSA has a legal claim against the U.S. government. If the treasury failed to redeem bonds held by the SSA that would be clearly be a default, but there is no chance of that ever happening.
That you and I both want the treasury to have set aside funds for all the debt they have issued or made real investments with real paybacks. Doesn't mean the treasury doesn't really owe the funds, and will have to come up with the cash.
Now to be fair, some of what the treasury spends on are real investments. Defense is a real investment that protects our country and the treasury's ability to raise funds. Some infrastructure projects increase commerce and increase treasury revenues. But a lot is clearly inexcusably wasted. And I don't like it either.