Reply #13: It barely existed 4 years ago.

[Igel]

Since SS was running a surplus the money has routinely been used for the deficit. SOTUS is clear in two rulings: FICA is tax money, and Congress can do with it what it wants. They've been using it to cover the deficit.

That's Krugman's trust fund: it's full of IOUs. Imagine you are saving for a new car for your wife; her's will die in 7 years. You put aside $200 a month. You borrow that $100 each month to dine out. After 7 years you tell your wife that the "car account" has enough assets for a fairly cheap new car: but they're all IOUs that you have to pay back from your general income stream. You're screwed. Your wife "votes you out of office."

For a year or two there was a small amount of money in the "trust fund". As long as we weren't running a deficit. That was Gore's "lock box". Before Clinton ran a surplus, there was nothing to put in the lock box but IOUs. Even then, I don't think the surplus covered the entire amount that *should* have been put in the lock box--but don't quote me on that.

It's possible to create a small trust fund with the FICA surplus between now and 2018. (Truth be told, the date will probably be later ... SS is always a bit more conservative with their math than turns out to be justified.)

That money plus interest will be due from, estimates today are, 2018 to 2042. SS Admin. estimates that to be a bit shy of $11 trillion, $1 trillion of that coming in the last year. (Probably a high estimate, but they follow Congress-mandated assumptions.) That will need to be in the *general* budget, in addition to the usual spending (Medicare, customs, roads, military, schools, EPA, DOE ...). I don't want to think about the US bond rating late in that run of deficits.