POLI 100E, Interest Group Politics: Topic 2, Why are there so Many Interest Groups?

Do the Assests of the Trust Fund "Exist"?

1. Yes.
   They exist in the sense that there are paper receipts for
   $1.5 trillion in a filing cabinet at the Bureau of Public
   Debt in West Virginia
   
   

President Bush at the Bureau of Public Debt
5 April 2005

2. No.
   They do not exist in the sense that the assests are held in
   non-negotiable U.S. Government Notes. The Trustees
   cannot sell or trade these Notes for real assests
   
   
3. The Payroll Tax Monies we all pay are used to
   purchase U.S. Government Notes. Hence, the Monies
   are then treated as income by the Treasury
   and they go into the general fund and are
   used to pay for the activities of the Federal
   Government. If the Trustees had real control
   over the assests so they could trade them on the
   open market, then the Federal Government would
   have to have on hand large reserves of cash
   to buy back the notes if they were traded.
   
   
4. Social Security is a Pay as You Go system.
   Currently, payroll tax receipts exceed payments to
   beneficiaries. When payroll tax receipts are less than
   the payments owed beneficiaries, the difference will
   have to made up out of the general fund. This will
   happen because of the strong moral obligation
   that politicians have made to the public during the
   past 60 years!
   
   

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