Social Security is solvent?

Overall this was a fairly decent article about Social Security, but the author demonstrates a lack of understanding about solvency.

Solvent means the ability to pay all obligations. In the case of Social Security that means all current beneficiaries and those who have earned and are still accumulating benefits but are years away from collecting.

Saying the Trust is backed by the U.S. Government is irrelevant as the Trust is being depleted simply by paying current benefits.

The fact is incoming revenue to the Trust will be inadequate to pay that full liability starting in nine to ten years when the Trust reserve is depleted.

There is no longer a surplus to invest in Treasury bonds.

Interest earned by the Trust is being used to pay benefits.

The Social Security Trust Fund is solvent 

The Social Security Trust Fund has $2.8 trillion as of December 2023. These funds are backed by the full faith and credit of the U.S. Government. They are more solid than private equities, stocks or corporate bonds. The Treasury invests the surplus in interest-bearing U.S. government securities, which in 2022, earned about $66.4 billion in interest. 

Source: The Daily Montanan

One comment

  1. I think you and the Daily Montanan are talking past each other. You are talking unfunded liability and the Montanan is giving credence to the current trust fund balance. At least that is true of the part you posted.

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