Social Security is the largest owner of US Debt: http://www.forbes.com/sites/mikepatton/2014/10/28/who-owns-t...
The largest owner of U.S. debt is Social Security. Since the Social Security system is a government entity, how can the government own its own debt? Good question. This is where the “house of cards” theory resides. Some believe the federal government is merely moving the IOUs from one shell to another, hoping to escape the watchful eye of its citizens. In any event, Social Security owns about 16% of the debt followed by other federal government entities (13%), and the Federal Reserve (12%.
My guess is when it is time to pay or the money dries up, they are going to just disregard the Social Security debt owed or stretch it way out so the house of cards stays up a bit longer.
I disagree. Taxes with simply rise (as they should've long ago).
No one is ever shocked about all of the SS trust fund cash put into US treasuries (general fund deficit spending), but always shocked that "thats going to need to be paid back one day."
https://www.ssa.gov/news/press/factsheets/WhatAreTheTrust.ht...
> The Social Security trust funds hold money not needed in the current year to pay benefits and administrative costs and, by law, invest it in special Treasury bonds that are guaranteed by the U.S. Government. A market rate of interest is paid to the trust funds on the bonds they hold, and when those bonds reach maturity or are needed to pay benefits, the Treasury redeems them.
Trust fund stats: https://www.ssa.gov/oact/STATS/table4a3.html
The mind boggles. We've been living like a college student on credit cards, and the bill is coming due.