Help! Facts re: Social Security (economists, historians & poli-scis)!!

[Just Me]

An assertion has been made that, before the Korean War, the US Congress approved "borrowing" against the SS fund,...and that, Congress has been 'draining' ever since.

I have searched and find no evidence of such an assertion although Congress has always held the power to alter/amend/etc who may receive funds from the Social Security "trust" fund.

From what I have read, that fund was a pay as you go system until 1980 (when "Reagonomics" was injected).

I would appreciate a synopsis by any informed DUer.

[derrald]

1. All I know

Is that Bush's current plan is to drain 1.4 trillion dollars fromt he fund until 2013.

[Just Me]

2. That's not enough.

Although Roosevelt believed he created an "untouchable" fund (which admittedly was securely borne on the backs of the lower and middle class), my adversary asserts that it has been subject to financing other "infrastructure",...stuff.

[Just Me]

3. I'll kick this for,...as long as it takes *smile*. n/t

[cam75219]

4. Isn't google wonderful..........

I'll let you decide what happens to the money after it is invested in "special-issue" Treasury bonds. See below from the Social Security Administration Website.


Q. Does Social Security have dedicated assets invested for my retirement?

A. Social Security is largely a "pay-as-you-go" system with today's taxpayers paying for the benefits of today's retirees. Money not needed to pay today's benefits is invested in special-issue Treasury bonds.

Q. Is there really a Social Security trust fund?

A. Yes. Presently, Social Security collects more in taxes than it pays in benefits. The excess is borrowed by the U.S. Treasury, which in turn issues special-issue Treasury bonds to Social Security. These bonds totaled $1.5 trillion at the beginning of 2004, and Social Security receives more than $80 billion annually in interest from them. However, Social Security is still basically a "pay-as-you-go" system as the $1.5 trillion is a small percent of benefit obligations.

http://www.ssa.gov/qa.htm

[salvorhardin]

5. Yes and No

I don't know about that specific timeframe, but it's true that the U.S. government 'borrows' against Social Security. In reality, the Social Security Administration buys government bonds which the government must pay back. Also there is more than just one social security trust fund and interfund borrowing can occur, but must be repaid with interest. I believe this happened only twice in the 80s, but I may well be wrong here.

This article from the July 1998 Atlantic Monthly, "Nine Misconceptions About Social Security" may be of use to you. The link is to a copy stored in the internet archive since Atlantic Monthly archived articles are available to subscribers only (it would seem).
http://web.archive.org/web/19981205143053/http://www.theatlantic.com/issues/98jul/socsec.htm

[FightinNewDem]

6. Here's a source of info

http://www.concordcoalition.org/socialsecurity/

"The Concord Coalition is a nonpartisan, grassroots organization advocating fiscal responsibility while ensuring Social Security, Medicare, and Medicaid are secure for all generations.

The Concord Coalition was founded in 1992 by
the late former Senator Paul Tsongas (D-Mass.), former Senator Warren Rudman (R-N.H.),and former U.S. Secretary of Commerce Peter Peterson.
Former Senator Bob Kerrey (D-Ne.) was named a co-chair of the Concord Coalition in January 2002."

[bain_sidhe]

7. There was no "trust fund" until 1983

As you said, SS was a pay-as-you-go until the "Commission on Social Security Reform" (chaired by Alan Greenspan) recommended a steep increase in SS taxes - bringing in money that was NOT needed for current beneficiaries - so as to build up a "reserve" for when the baby-boomers retired.

Pretty much ever since then, the gov has been "borrowing" this supposedly inviolate "reserve" for non SS uses, and leaving "I.O.U.s" in the trust fund box.

Interesting, isn't it, that Greenspan recently said that the gov will have to cut benefits in order to be able to afford chimpco's tax cuts for the wealthy.

[no name no slogan]

8. Google "Left Business Observer"

It's a newsletter by Doug Henwood, who writes for several left-leaning/progressive publications, including Mother Jones and the Nation, IIRC.

I remember back in the late 90s during the stock market boom that he had several good pieces about "saving" social security (by privatizing it of course) and how the market was severely overvalued-- all this a couple of years before Greenspan even uttered "irrational exuberance".

Good stuff for any "free market" economic argument right-wingers (and sadly, even some Democrats) put forth.