>>>>It seems to me that there is a lot of debate about exactly what are the 'assets' in the Social Security Trust Fund. I don't know if I understand everyone's claims, but I do know that no one seems to have a complete understanding of exactly how the Trust Funds
operate.
The problem is really that we all claim to understand, but that our 'understandings' are all different.
>>>>Just as a public service announcement, so that maybe we can get past the useless arguments over who is right about the structure of the Trust Fund, and address the actual question, which is what are the options for reform (i.e. exactly what do we do now to solve the crisis).
I understand your frustration with the debate, but it really is important on a number of levels. First, it directly impacts in an important way on the financial condition of SS. That has significant importance on whether SS should be reformed, and if so, what funds are available for transition costs. Secondly, if the TF is a scam pulled by the gov't (and I do NOT think that it is), then we would probably want some form of privatization on that basis alone. Finally, if we can't agree on what today's reality is (and it really isn't all that complicated), it is unlikely that we can agree on what the future holds in terms of projections from one side or the other. The debate is far from 'useless'.
>>>>Hopefully this information will be helpful in resolving some of the arguments over how the Trust Fund functions, because I think a more pressing need is to concentrate on the how, when, etc. of actual reform proposals.
I don't think it will be. You didn't share with us what you think that quote means. Does the SSTF represent the real stored value of SS excess taxes that can be used for future benefits until 2034 without requiring a general taxpayer subsidy? Or is it a government scam, with the money having been spent, that represents no value left, with future taxpayers having to subsidize SS after 2015?
Two quotes from your cite will obviously let people from each side find 'what they want':
>>>>"Along with many other forms of revenues, these Social Security taxes become part of the government's operating cash pool, or what is more commonly referred to as the U.S. treasury. In effect, once these taxes are received, they become indistinguishable from other monies the government takes in."
In other words, there is no TF. Its all the same money, and we know the gov't is in debt to the tune of $5.6 Trillion. Ergo, the TF is also broke.
>>>>"In a sense, the mechanics of a federal trust fund are similar to those of a bank account. The bank takes in a depositor's money, credits the amount to the depositor's account, and then loans it out. As long as the account shows a balance, the depositor can wr4ite checks that the bank must honor."
