lewrockwell.com / By Walter E. Williams / January 30, 2013
Let’s expose presidential prevarication. Earlier this year, President Barack Obama warned that Social Security checks will be delayed if Congress fails to increase the government’s borrowing authority by raising the debt ceiling. However, there’s an issue with this warning. According to the 2012 Social Security trustees report, assets in Social Security’s trust funds totaled $2.7 trillion, and Social Security expenditures totaled $773 billion. Therefore, regardless of what Congress does about the debt limit, Social Security recipients are guaranteed their checks. Just take the money from the $2.7 trillion assets held in trust.
Which is the lie, Social Security checks must be delayed if the debt ceiling is not raised or there’s $2.7 trillion in the Social Security trust funds? The fact of the matter is that they are both lies. The Social Security trust funds contain nothing more than IOUs, bonds that have absolutely no market value. In other words, they are worthless bookkeeping entries. Social Security is a pay-as-you-go system, meaning that the taxes paid by today’s workers are immediately sent out as payment to today’s retirees. Social Security is just another federal program funded out of general revenues.