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Nobody "raids Social Security" -- please stop perpetuating this silly meme. Social security and other entitlement surpluses are automatically loaned to the gove

by dminor 17y ago

Nobody "raids Social Security" -- please stop perpetuating this silly meme. Social security and other entitlement surpluses are automatically loaned to the government in exchange for non-marketable debt. The alternative would be a larger deficit, for which you'd sell more UST bonds, which the entitlement programs would then buy since they need a safe place to park their surplus. Voila, you're basically right back where we are now - entitlement surpluses funding a portion of the deficit. We don't need a lock box, we just need a more accurate definition of deficit.

anamax 17y ago
> The alternative would be a larger deficit, for which you'd sell more UST bonds, which the entitlement programs would then buy since they need a safe place to park their surplus. It's not clear that UST bonds are a safe place.... SS has made a lot of promises. It's unclear that they'll be satisfied. And, to be fair, there's no legal obligation to satisfy them. The whole "we lent the money to the federal govt" angle will make it harder to fix SS.
philwelch 17y ago
The alternative would be to actually balance the federal budget before taking into account entitlement surpluses, something that not even Clinton ever accomplished. It's a huge violation of the idea of a trust fund to invest that trust fund in loans to oneself.
- dminor 17y ago
  > The alternative would be to actually balance the federal budget before taking into account entitlement surpluses That's what I meant by a more accurate definition of deficit. You could call it "gross deficit" for instance, just like "gross debt" includes intra-government debt. > It's a huge violation of the idea of a trust fund to invest that trust fund in loans to oneself. Not if you're the most stable investment. I can't envision a future where the US government decides it won't meet its debt obligations but SS and Medicare survive because they were prudently invested elsewhere.

by dminor 17y ago

anamax 17y ago

> The alternative would be a larger deficit, for which you'd sell more UST bonds, which the entitlement programs would then buy since they need a safe place to park their surplus. It's not clear that UST bonds are a safe place.... SS has made a lot of promises. It's unclear that they'll be satisfied. And, to be fair, there's no legal obligation to satisfy them. The whole "we lent the money to the federal govt" angle will make it harder to fix SS.

philwelch 17y ago

The alternative would be to actually balance the federal budget before taking into account entitlement surpluses, something that not even Clinton ever accomplished. It's a huge violation of the idea of a trust fund to invest that trust fund in loans to oneself.

dminor 17y ago
> The alternative would be to actually balance the federal budget before taking into account entitlement surpluses That's what I meant by a more accurate definition of deficit. You could call it "gross deficit" for instance, just like "gross debt" includes intra-government debt. > It's a huge violation of the idea of a trust fund to invest that trust fund in loans to oneself. Not if you're the most stable investment. I can't envision a future where the US government decides it won't meet its debt obligations but SS and Medicare survive because they were prudently invested elsewhere.