"This is how much Social Security adds to our national deficit: $0" - Katie Porter

314 Action, a Democrat funding raising group, sent an email with this:

Transcript:

This is how much Social Security adds to our national deficit: $0!

Social Security isn't debt financed. In fact we currently have over $2.9 trillion in surplus.

It's nuts to blame working Americans who pay for the program and suggest that Social Security is in any way responsible for the national debt.

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Every single part of this is wrong. Every bit. It's astonishing, in fact, the ignorance presented here. Let's parse it:

• This is how much Social Security adds to our national deficit: $0! There is no such thing as the "national deficit." There is the government's annual budget deficit, which is the difference between actual spending and actual revenue in a particular fiscal year. The National Debt is the sum total of all the deficits.

• Social Security isn't debt financed. Yes, it is. 100%. There is an accounting device called the Social Security Trust Fund, which collects the revenues from everyone's paycheck. The Fund then disburses payments to its various beneficiaries. The government purchases the remaining cash assets from the Fund with non-marketable treasury bonds.

Bonds are debt instruments. The government is taking the cash and putting certificates of debt into the Trust Fund. According to ssa.gov, they are special issues that only the government can own. They cannot be sold to anyone other than the Trust Fund:  

 

Since the beginning of the Social Security program, all securities held by the trust funds have been issued by the Federal Government. There are two general types of such securities: 

• Special issues—available only to the trust funds
• Public issues—marketable Treasury bonds available to the public.

The trust funds now hold only special issues, but they have held public issues in the past.

This is important to understand. The government sells these "special issue" bonds to the Trust Fund, takes the cash from the sale and puts it in the General Fund to spend. In return, the Trust Fund owns these bonds. Therefore, the contents of the Trust Fund is nothing but debt that will have to be repaid.

• In fact we currently have over $2.9 trillion in surplus. No. According to ssa.gov, we have $23.1 trillion in unfunded liabilities.

• It's nuts to blame working Americans who pay for the program... Which hasn't happened. The blame has always been leveled at government.

• ...and suggest that Social Security is in any way responsible for the national debt. The Social Security Trust Fund is an additional part of the National Debt, it's not responsible for the debt. However, it's not included in the official debt number as an off-budget program. But the debt government owes to the fund still exists.

Social Security is being manipulated by government as a cash cow. No one blames the program itself, only how the government appropriates its assets for general use. All blame belongs to the government that created it and transformed it into a shell game.