9 upvotes, 2 direct replies (showing 2)
View submission: Elon Musk can’t balance the budget
This narrative is entirely political. Congress has decided to modify how social security gets funded over the years. When I was young, they started 'borrowing' against social security. Now the gap, which was deliberate and enacted by law, gets thrown around as a reason to discard the whole thing.
Social Security isn't at risk unless politicians make it at risk.
Comment by Hemingwavy at 26/11/2024 at 11:27 UTC
1 upvotes, 0 direct replies
Social security doesn't hold their money in cash. They use it to buy US treasury bonds which is the "borrowing".
It actually has a legally distinct pile of money that is running out because they pay out more than they take in. It's projected in 2035 that they run out which means they can only pay out as much as they get in new contributions. That doesn't cover the amount they pay out. So they start paying out people 83% of what they're owed which continues to decrease as an aging population asks for more money and the ratio of working Americans to retired decreases.
Anyway what will actually happen in 2035 is congress is just going to pass a bill that says social security can borrow money from the us treasury and it's just going to run at a loss.
Comment by reasonably_plausible at 26/11/2024 at 16:00 UTC*
0 upvotes, 0 direct replies
When I was young, they started 'borrowing' against social security.
No, they didn't. There was a change in how the fund was displayed in the budget, but it did not change how money flowed into or out of the fund. Nor how Congress could do anything with that money.
https://www.cnn.com/2018/05/21/opinions/social-security-myths-opinion-richtman/index.html