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[El_Johns]

128. But I DID read it. You didn't post the summary comments:

Last edited Sun Dec 15, 2013, 11:54 PM - Edit history (1)

"And the explanation is actually pretty easy. But so too is the following conclusion:

Public Debt is NOT the Sum of Federal Deficits."


1. Do you know the easy explanation?
2. Did someone in this thread claim that the debt was the sum of federal deficits?

On edit: I got tired of waiting for your response so here's Webb's "easy explanation" of why the debt went up by $130B though both the general budget & SS ran a surplus: it's in the Comments section of your link:

Bruce Webb
November 12, 2013 8:46 pm

If the General Fund runs an actual surplus what you would expect is to see ‘Debt Held by the Public’ decrease. And decrease it did in FY 1999

On the other hand when Social Security runs a surplus what you would expect to see is an increase in its Total Assets. And so you do, but NOT at this link. Instead you see a corresponding increase in Intergovernmental Holdings with in turn adds to ‘Total Public Debt’.

Which leads to the rather odd result that no matter how large a given General Fund surplus might be in any given year and not matter how much that serves to reduce Debt Held by the Public if the Social Security surplus is larger than the General Fund surplus then Total Public Debt still goes up...

A Social Security system in perfect actuarial balance, that is one that has a Trust Fund ratio exactly at 100 for every year in the projection period and so neither overfunded or underfunded, will see the nominal value of the assets in the Trust Fund increase year over year in the amount needed to maintain that TF Ratio at 100. And that increase will score as an equal increase in Total Public Debt...

Yep this means that we could balance the General Fund tomorrow and put Social Security into a perpetually solvent state and we would STILL have the raise the Debt Ceiling every year. And this would also be true if we acchieved both goals via the Ryan Roapmap to Fantasy Land Act and ‘saved’ Social Security by slashing benefit formulas.

Under current law definitions and metrics a fully Solvent Social Security system will add to Total Public Debt every year. And that fact has nothing to do with other off budget spending or the state of the General Fund. Instead it is a direct consequence of the requirement established with the 1939 Amendments that all SS revenue in excess of cost be held in instruments fully guaranteed as to principal and interest by the U.S. government coupled with the requirement that the Trustees target a certain level of annual reserves. Both decisions were and are perfectly sound ones, any insurance plan needs a level of reserves (or good reinsurance) and ideally has those in safe and liquid investments. And outside the minds of Gold Bugs there are no safer and more liquid investments that Special Issue Treasuries. So that is all good.

It just ends up playing havoc with our idea of what Total Public Debt means in real terms. As opposed to the similarly named but quite different thing that is Debt Held by the Public.

- See more at: http://angrybearblog.com/2013/11/debts-deficits-and-social-security-once-again.html#comments

To summarize: the SS TF assets = part of the Total Public Debt, as intragovernmental holdings. The TF is excess SS taxes that have been borrowed by the government, PLUS interest payments on same.