Flopper
Diamond Member
Of course Social Security has no money. It doesn't need any. It has tax receipts coming in monthly which pays most of the benefits plus monthly bond interest that pays the remainder.
Not sure where you are getting the 33%. Each month the trust fund account is credited with FICA tax income and interest on bonds and debited for the amount to write benefit checks. Since tax collection and interest pay the benefits currently, the only increase in national debt is for bond interest. However, currently that requires no new borrowing.
Once benefit payments exceed FICA tax collections and interest paid, then the fund balance will fall because bonds will be redeemed to make up the shortfall. Bond redemption would decrease debt and additional borrowing to cover the redemption would increase debt so net result on national debt would be zero.
Finally when all bonds were redeemed, benefits would have to be reduced by 25%, or some combinations of borrowing, tax increases, and benefit cuts.
This all assume that Congress makes no changes in benefits payments or tax collection over the next 20 years. Of course what' going to happen long before the fund reaches a zero balance, congress will act to either increase income are cut benefits, probably both.
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