Frog Soup

Ruminations on the twilight of democracy in America.
by Monkey99

 
 

Friday, February 11, 2005

The Thief-in-Chief

A few weeks ago, Josh at TPM surmised that part of Bush's real plan to "reform" Social Security was to figure out how to not pay back the money that has been borrowed out of the trust fund over the years to finance the general fund deficits.

Well, he turns out to have been correct. The Liar-in-Chief has come right out and said that "there is no trust fund".

Let's be clear what we're talking about here. The trust fund (and it does exist) was set up in 1939 and was used as a reserve for times when payroll taxes exceeded benefit payments. In 1983, payroll taxes were increased in anticipation of the retirement of the Baby Boomers. So Social Security began deliberately running a large surplus which built up the trust fund. Also during roughly this same time, the general fund began running a large defecit, financed by Treasury Bonds. The Social Security Trust Fund is one of the major holders of these bonds. (i.e. the general fund borrowed money from the trust fund).

This time period (1983-present) roughly coincides with my entire working life. So, in addition to paying for current retirees, a certain percentage of my payroll taxes has been going into the Social Security Trust Fund,where it has been borrowed to finance Reagan's, Bush I's, and Bush II's gargantuan defecits. In short, They Borrowed Our Money.

Now George is saying, "Trust Fund? What Trust Fund?" He has no intention of paying back the money he and the other Republican spendthrifts borrowed. We are talking about the outright theft of about $2 trillion. If you want to get an idea where the $2 trillion went, add up all the tax cuts for corporations and the rich over the past 23 years.