Bernie Sanders Has An Amazingly Simple Idea To Fix Social Security For The Next 75 Years

[Selatius]

121. Well, when you put it that way, I have no objection to going back to pay-as-you-go.

But my understanding of SS as it currently is, is that it can't be co-mingled into the General Fund by law.

When SS payroll taxes takes in more than is spent on current beneficiaries, I am of the understanding that the sum is used to buy special series Treasury bonds that are non-marketable and can only be held by SS and redeemed at the Treasury.

The bonds pay interest until maturity, and the payment of that interest comes from the General Fund, so it does indirectly impact deficits and surpluses the General Fund may have at the time.

When SS goes and redeems those Treasury bonds, the Treasury will hand SS cash in exchange for the matured bonds, and the cash goes to retirees.

I was of the understanding that under the original Social Security Act, funds meant for Social Security can't be used for the General Fund, and I was of the understanding that this remained true even after the recommendations made by the Greenspan Commission were enacted into law.

However, if that is all incorrect, then what you are saying is that every time SS payroll taxes collects more than is spent out, the sum isn't used to buy Treasury bonds but instead used to fund whatever program in the General Fund that Congress wishes, is that right?