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Borrowing Against SS
Old 02-14-2012, 09:51 AM   #1
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Borrowing Against SS

I thought it would be easy to find an answer, but it appears Google has failed me on this one...

Does the government pay interest back to the Social Security Trust Fund on the money it borrows?

Secondly, if the government had not borrowed against it, and instead invested the surplus, wouldn't we have A LOT more to pay out to beneficiaries?

(small rant)
It pains me to think what our country could be like if we were a little more responsible with our spending/savings. Imagine if we had another country paying interest to us and we could use that to fund a large fraction of our government expenses. I understand that our country and economy is driven entirely by consumption... so it makes perfect sense that our politicians would fall into the same trap. Really is a shame that we have wasted such an amazing opportunity with the economy we'd had the last 100+ years (the envy of every other nation). What do we have to show for it... not as much as we probably should, at this point.

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Old 02-14-2012, 09:55 AM   #2
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The answer to your first question is yes, the general fund owes the SS fund interest on the money it borrowed..

To your second, no.... money is fungible... so there would not be any more money to pay benefits... (or course, this might have been different if people actually knew the deficiet of the general fund without the borrowing)...

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Old 02-14-2012, 09:56 AM   #3
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Trust fund Social Security Trust Fund - Wikipedia, the free encyclopedia

Other info Social Security (United States) - Wikipedia, the free encyclopedia
Social Security debate in the United States - Wikipedia, the free encyclopedia
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
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Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
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Old 02-14-2012, 10:04 AM   #4
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thanks for the links!
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Old 02-14-2012, 11:52 AM   #5
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The yearly report from the Social Security Trustees tabulates all information like this.

The current assets and interest rates on the bonds are shown at:
2011 Trustees Report: Appendix A

This table shows that the interest earned in 2010 for the Social Security Trust Fund was 108 billion.
2011 Trustees Report: Section II.B, Trust Fund Financial Operations
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