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While I don't know about the 1 Trillion (I suspect it is more) that money is already spent by the Gov't and is owed to the SS trust Fund by the General Fund - It is probably in the form of Treasury Bills, Notes and Bonds. As such, this amount is already included in the national Debt calcs and repayment to the SS Sytem does not increase the current budget deficit. It does reduce Cash available in the year a repayment is made however.

The shame of all of this is that, if something along the lines of what is being proposed now had been undertaken say 20 or 25 years ago the transition would have been much, much smoother and the private Accounts would be very much ahead of the game. (Check out the annualized return of the S & P 500 Index over the past 20-25 years)

Unfortunately, despite the fact that, even at that point in time, SS was widely recognized as a financial bomb waiting to go off, it was also described as the 'Third Rail' of Politics and the Interest Groups united to quash any efforts to correct this deeply flawed scheme.

In the intervening years, the Gov't has borrowed the surpluses from the fund and essentially wasted them. So now we find ourselves like the irresponsible Credit Card user who went on shopping binges and purchased junk. We have the Debt but nothing at all to show for it. A mess but one that, IMO, was completely predictable and was in fact predicted to end this way by many.

...that money is already spent by the Gov't and is owed to the SS trust Fund by the General Fund - It is probably in the form of Treasury Bills, Notes and Bonds. As such, this amount is already included in the national Debt calcs and repayment to the SS Sytem does not increase the current budget deficit.

There was a good post on this subject a couple weeks ago, but unfortunately, I haven't been able to dig it out yet.

I think that the indebtedness was originally treated as a ledger entry only, no bonds, notes or documentation of any kind, but now there is some form of paper, but I believe that it is of an unusual kind.

Similarly, since this is basically a current account transaction, I do not believe that this indebtedness is included in the National Debt. I would be extremely surprised if it is, since it is purely an internal government accounting transaction.

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The shame of all of this is that, if something along the lines of what is being proposed now had been undertaken say 20 or 25 years ago the transition would have been much, much smoother and the private Accounts would be very much ahead of the game.
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The fact that nothing was done 20 years ago is one of the reasons that I think current and soon-to-be recipients of Social Security should share in the burden of averting disaster. I do not think they should be able to march into the sunset leaving us (current workers) holding the bag. Anyone now receiving, or about to receive Social Security is part of that group that made it the third rail. They are part of that group that saw the problem but did little. They loved the beautiful music of easy money, and now the pipe wants to be paid.

Any costs to changing the system (I really don't want to "save" it) should be met by current benefit cuts and spending cuts in other welfare programs. There should be now new costs foisted on the current workers (after all they will be receiving far less, if any, benefits from it).