What the Federal Government Says
 About the Social Security Trust Fund

"These [trust fund] balances are available to finance future benefit payments and other trust fund expenditures -- but only in a bookkeeping sense. These funds are not set up to be pension funds, like the funds of private pension plans. They do not consist of real economic assets that can be drawn down in the future to fund benefits. Instead, they are claims on the Treasury that, when redeemed, will have to be financed by raising taxes, borrowing from the public, or reducing benefits or other expenditures. The existence of large trust fund balances, therefore, does not, by itself, have any impact on the Government's ability to pay benefits."

-- Analytical Perspectives, Budget of the United States Government,
 Fiscal Year 2000, p. 337 [emphasis added]

"The assets of the trust funds can be redeemed for cash at any time if required to meet program expenditures. The redemption of a Treasury security held by a trust fund requires that the Treasury transfer cash -- obtain from another revenue source, such as income taxes or borrowing from the public -- to the trust fund."

- 1998 Annual Report of the Board of Trustees of the Federal
 Old-Age and Survivors Insurance and Disability
 Insurance Trust Funds, p. 26 [emphasis added] 

"When the trust fund needs to draw down its balance, the Treasury must obtain the necessary money to repay the trust fund by borrowing from the public, unless the Congress and the President take offsetting actions to raise taxes or cut spending."

--"Social Security Financing: Implications of Government Stock
 Investing for the Trust Fund, the Federal Budget, and
the Economy,"  United States General Accounting Office
 Report to the Special Committee on Aging, U.S. Senate,
 April 1998, pp. 31-32 [emphasis added].

"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. They are accounted for separately through the issuance of federal securities to the Social Security trust funds-- which basically involves a series of bookkeeping entries by the Treasury Department -- but the trust funds themselves do not hold money. They are simply accounts. Similarly, benefits are not paid from the trust funds, but from the Treasury."

-- "Social Security Taxes: Where Do Surplus Taxes Go and How Are They Used?" by David Koitz, CRS Report for Congress (94-593 EPW),
updated April 29, 1998 [emphasis added].

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