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'Fixing' Social Security is easy

Recently there have been a number of articles about the need to "fix" Social Security. One would hope that by now most people would know that this is a totally phony issue.

Here are two of the reasons: 1. The Social Security retirement and disability trust funds are simply the accumulated net differences between many years of receipts and disbursements of the Social Security system and do not represent any real form of assets or liabilities.

Their "assets" consist entirely of restricted U.S. Treasury notess which are nonnegotiable and nothing more than glorified IOUs from the U.S. Treasury. They are offset by intra-government obligations that are completely eliminated in the consolidated Federal Government financial statements.

Thus, whether they are eliminated or tripled in size, it is of no consequence to the Federal Government's overall financial condition.

This is reiterated in Footnote 6 to the 2013 audited financial statements of the Social Security system which state, "Because the OASI and DI Trust Funds and the U.S. Treasury are both part of the Government, these assets and liabilities offset each other for consolidation purposes in the U.S. Government-wide financial statements. For this reason, they do not represent a net asset or a net liability in the U.S. Government-wide financial statements."

2. The only action needed by Congress is to pass a simple piece of legislation that a) allows the S.S. system to borrow indefinitely from the U.S. Treasury or b) better yet, eliminates the need for any intragovernmental borrowing by eliminating the "trust funds."

This would also save millions of dollars in unnecessary accounting and actuarial expenses and put Social Security officially on a "pay-as-you-go" basis, which is what, in substance, it has been and is now.

Roland G. Ley

Arlington Heights

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