Interest that flows into the system is vital because this revenue is free cash flow. In contrast, when the program collects a dollar of revenue from the payroll tax, the worker in some fashion is given a promise of benefits in the future.
In this case, “free” means interest income adds to the life expectancy of the program on a dollar for dollar plus interest basis. Of the current $2.8 trillion reserve, the payment of interest from the government and interest on interest accounts for more than 90 percent of the Trust Fund.
Social Security is just another tax. Period.
Means test payouts. That’s about the only way I can think of it being ‘saved’
I love watching Republicans dive head first into social security and entitlement reform. The GOP is suicidal, and it’s wonderful!
Social Security is not the real problem, it’s Medicare and Medicaid costs that are out of control. Currently now over 1/3 of Federal Budget and moving to 1/2. It will have to dealt with very soon.
Deflection.
From the real problems
Agencies Bureaus “Services”
“Over the course of 2022, Social Security lost nearly $5 billion in interest earnings...”
As bad as that is, the our government lost $45B in one spending bill to Ukraine, just to see Soledar liberated 2 weeks later.
And here is what we were promised way back in 1964!
https://www.ssa.gov/history/ssa/usa1964-2.html
Self-Supporting
“The program is designed so that contributions plus interest on the investments of the social security trust funds will be sufficient to meet all of the costs of benefits and administration, now and into the indefinite future—without any subsidy from the general funds of the Government. Both the Congress and the Executive Branch, regardless of political party in power, have scrupulously provided in advance for full financing of all liberalizations in the program.”
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About 20 or so years ago AARP magazine or Bulletin had an article on how the SS system was NOT a Ponzi Scheme.
Ponzi Schemes collapse. SS has not, therefore it is not a Ponzi Scheme.
A few pages more into the magazine was an article by Jane Briant Quinn on how the SS program was set up. Without saying it, the set up is just like a Ponzi Scheme.
In fact, the whole SS "lockbox" is the same thing. If the government just spent the excess SS tax money without running it through the lockbox we would be in the same situation we are in today: SS taxes do not cover paid benefits and the excess must me made up by the general revenue (or massive borrowing). Further, not having a lockbox might have been cheaper because then you wouldn't need an office in West Virginia (thanks Senator Byrd) stacking and counting paper bonds.
“””To illustrate, in November, Social Security needed extra cash to pay the bills, and redeemed nearly $100 billion in bonds at par, which earned 4 percent interest. At the same time, it kept bonds that pay less than 1 percent on the books. Given the process, the program lost nearly $2 billion in interest.”””
If Social Security had redeemed the 1% bonds, they would not have received par. Instead, they would have received about 70% of the face value of the bonds.
You might lose interest depending up purchase price, however when redeemed at par=face value you don't lose principal. A bond with a 1% coupon sold in a higher interest rate environment would lose much more in principal that the 2 billion in lost interest.
Jeez-o-pete...
Any financial investor worth their weight is making some money, even in today’s market.
The sheer incompetence in government employees is astounding.
There is absolutely no reason for this program to run out of funds, except for government incompetence
Yes, the system is set up to lose money intentionally and for many reasons. Solvency hasn’t been the goal of the U.S. government for a long time. Engineering crisis after crisis is the real goal of government. Keeping the populace in a constant state of fear, and uncertain about the future, provides infinite benefits to those in power.
5 billion “lost” by the ever-vigilant, super-competent federal government.
And I have to write estimates and cases to justify even $500.00 or $5,000.00 for new tooling and equipment at my company!
The easiest way to fix Social Security would be to Outlaw All Taxpayer Funded retirement programs and let congress go on Social Security for their retirement
The American Institute for Economic Research (AIER) has an article entitled “A Way Out” that details an excellent way to transfer out of Social Security. This proposal protects current recipients while enabling younger people to fund their own accounts. The government needs to stay out of the way on this issue and many others.
OMG, the lack of understanding on this is EPIC.
What does it take for people to understand that you CANNOT think of ANY bonds held by Social Security as assets. They are just line items of money the Federal Government DOES NOT HAVE, and NEVER WILL. Even if the “money” to pay this off gets printed, it will devalue the currency to the point where the loss of real private wealth outweighs any “gain” on paper from “balancing the books.”
Interest on all of those bonds is simply more debt piled on the the National Debt pile. Picking a bond to redeem with a 1% rather than a 4% rate only quadruples the rate of Social Security debt piling on the National Debt.
That is literally ALL IT DOES. There is no money, or any other type of revenue producing asset anywhere near the Social Security Ponzi scheme.
All of these moronic discussions of “fixes” is just rearranging deck chairs on the Titanic.
If you’re holding a bond paying 1% it is significantly down in price and if you redeemed it now would face a priciple loss. You need to look at total return, not just yield.
HOW TO SAVE SOCIAL SECURITY FOR IDIOTS
- Stop using the Social Security program as a mechanism for wealth distribution.
- Return to the original Social Security guidelines that defined who was eligible to receive benefits.
- Stop paying "benefits" (unearned wealth distribution) to illegals, bums, non-workers and others
who have not paid into the program and/or were not eligible for benefits under the original guidelines.Voila! - Social Security Is Saved!
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"On August 14, 1935, the Social Security Act established a system of old-age benefits for workers, benefits for victims of industrial
accidents, unemployment insurance, and aid for dependent mothers and children, persons who are blind, and persons with disabilities."Read More Here: https://www.ssa.gov/history/50ed.html
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“This simple fix could help save Social Security”
mandate that everyone receiving social security get covid-vaxed once a month until no one remains?