If the US Gov't payts off ALL it's national debt, then...?

Question

would we still have a social security trust fund, or would it be eliminated?

Answer 1

We don't have a Social Security trust fund, but I see where you're going--- since the "surplus" created in the early 1980s was immediately invested in T-Bills, which was immediately spent by Congress.

Now, on a consolidated level; the future service obligation of Social Security IS a part of national debt - to pay it, taxes will likely have to rise in the future to pay off this portion of the debt (or we can borrow more money).

That's how Congress fleeced the American taxpayer into approving raising Social Security taxes.

The lesson learned from this fiasco is never to give the government a "surplus" for some future liability, because they'll figure out a way to spend it now and make things worse.

Answer 2

That's a tough one to answer because the social security trust fund is assets applied against future liabilities (social security payables).

Assume the government pays off all it's current liabilities (ie, vendor-supplied things like energy, office supplies, payroll payables, etc.). This is possible because it is doing it now.

What about long-term liabilities such as T-Bills - there is sufficient cash and near-cash assets, but that would leave the USG in a position of low liquidity, there's little cash left.

That leaves the question of social security funds - if there really is a trust fund (ie, a separate account), it wouldn't last long. Note that social security has current payables (this month's checks and administrative costs) and future payables (due to you and me).

Answer 3

Social security, like any other of the multitude of socialist programs is part of the debt problem. If the US were even capable of paying off all of it's debt, it would need to start by limiting it's spending. In other words, EVERYTHING that is not essential would need to be shut down.

Many of us do not plan on having socialist security around when we retire. Sure, we are forced to pay into it, but we are not buying into the lie. Your best bet is investments such as business, real estate, stocks/bonds, offspring and the like. In the end, it is YOU that is in charge of your future. Don't count on Uncle Sam. He's a bully, thief and drug addict that cannot handle his own finances. ;0)