And then what will SS do with the cash? Put it in a lock box and let inflation eat away it's purchasing power?
Or Invest it? And if invest it, then where? Certainly not U.S. government securities, cause that's what we are doing now, and that's one hand borrowing from the other. Maybe Greece government securities? Or Communist China Government securities?
Or perhaps the stock market. SS would depend on the ups and downs of the market and government would own a massive share of corporate stock.
U.S. government securities is the safest place to invest the funds. It does mean that future tax payers are going to have to redeem those securities. But if you put cash away in a lockbox and then drew it out and spent it on SS, you'd be diluting the money supply of the future taxpayers anyway.
When the U.S. Treasury "buys" U.S. Treasury bonds it is lending money to itself and then spending the money on current outlays.
This is not investment.
At current yields, if the SSA buys US debt, they won’t be keeping up with inflation either. We currently have negative effective yields out to about the seven-year maturity on the yield curve.