General Discussion
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(145,242 posts)SamKnause
(13,106 posts)econoclast
(543 posts)Actually only kinda'. the fund in the SSTF were NEVER moved to the general fund. Ever.
What happens is ... By law that has been in place since FDR created SS in the 1930s ... Any time the SSTF has tevenues in excess of the current distributions to SS recipients, those funds are invested in US Treasury Securities. You can look it up.
At one point, to hide the costs of the VietNam war, LBJ put SS 'on budget' in the 1968 'unified budget'. Even this doesn't mean that he took SS funds and pit them in the general fund. But LBJ did use the SSTF funds to report a deficit that was artificially lower than it would have appeared otherwise. SS was put back 'off budget by Reagan.
jwirr
(39,215 posts)instead set it up so that the government could borrow the money as an investment. What we put in was invested in the government with interest so that the SSTF would grow. Since then I do not know if the government has always paid the fund back. They are supposed to.
econoclast
(543 posts)If you have to invest some excess cash and absolutely positively cannot lose a penny ... What is the safest thing there is? US Treasury Securities.
That's why the SSTF excess is invested in Treasuries. Because there is nothing safer.
Igel
(35,309 posts)The money's invested in special-issue treasury bills. Only one entity is authorized to hold them: The SSA. Only one entity is authorized to buy them back upon presentation: The US Treasury. In fact, the treasury must buy them back.
The "transfer" in the OP is not just something that a group of (R)-conspirators thought up. It's been the law for a long, long time. Only minor details have changed from time to time.