Subject: "RE: Fictional Government Accounting " Not quite
The trust fund accounting is not fictional but the annual budget accounting could be termed that. The general fund should be represented in a way that reflects the net changes in obligations (debt) that occur in that year. Under such a scenario what's termed a balanced budget would mean no change in the national debt. But continued trust fund surpluses will displace debt held by the public meaning that when trust fund needs to redeem the bonds between 2014 and 2034 when they run out, that debt can be reissued to the public. It will represent a much smaller proportion of the GDP then than the debt does now.
Still better is to use the yet to materialize general fund surpluses to pay down the existing trust fund debt associated interest that occurred because of general fund spending in excess of revenues. This will actually reduce the total debt, both public and private, and make the country that much better able to cope with its future needs.
These are budget reforms that can be enacted this year even without any changes to the Social Security system. Yet they will make it easier for the country to afford the future costs of Social Security.
