DIYbanter - View Single Post

HeyBub[_3_]

zzzzzzzzzz wrote:

It IS a separate fund. Funds received by SSA go into a pile called
the Social Security Trust Fund. Those funds are prudently invested
in U.S. Treasury bonds (which pay interest). The governors of the SS
Trust Fund can redeem these bonds anytime they wish.

Today, there is about $2 trillion in the Social Security Trust Fund
- in the form of U.S. Treasury Bonds.

To redeem them, the government must first borrow the money. There's
a problem here...

Actually, no. I'm not exactly sure how this works, but if SSA redeems a
bond, the indebtedness of the U.S. goes DOWN as they pay the bond in
funny-money. The U.S. does not have to borrow anything to redeem a SSA bond.