NewsFlash: President Obama Confirms there is no Social Security Lockbox

Oops!  Talk about sticking your foot in your mouth. After years of insisting that the funds paid into Social Security were being saved in a “lockbox”  and available for payment of Social Security benefits in the future, President Obama confirmed that the SS “Lockbox” is non-existent.

In an interview with CBS News, President Obama said:

“I cannot guarantee that those checks go out on August 3rd if we haven’t resolved this [debt ceiling] issue. Because there may simply not be the money in the coffers to do it.”

But if we had the SS payments in a “lockbox”, the money would be in that dedicated coffer and available to pay the Social Security funds to recipients.

Don’t remember Obama and his minions making this claim? Here’s a bit from a Charles Krauthammer column from March 2011:

Last week, President Obama’s budget chief, Jack Lew, took to his White House blog to repeat his claim that the Social Security trust fund is solvent through 2037. And to chide me for suggesting otherwise. I had argued in my last column that the trust fund is empty, indeed fictional.

If Lew’s claim were just wrong, that would be one thing. But it provides the intellectual justification for precisely the kind of debt denial and entitlement complacency that his boss is now engaged in. Therefore, once more unto the breach.

Lew acknowledges that the Social Security surpluses of the last decades were siphoned off to the Treasury Department and spent. He also agrees that Treasury then deposited corresponding IOUs — called “special issue” bonds – in the Social Security trust fund. These have real value, claims Lew. After all, “these Treasury bonds are backed by the full faith and credit of the U.S. government in the same way that all other U.S. Treasury bonds are.”

Really? If these trust fund bonds represent anything real, why is it that in calculating national indebtedness they are not even included? We measure national solvency by debt/GDP ratio. As calculated by everyone from the OMB to the CIA, from the Simpson-Bowles to the Domenici-Rivlin commissions, the debt/GDP ratio counts only publicly held debt. This means bonds held by China, Saudi Arabia, you and me. The debt ratio completely ignores the kind of intragovernmental bonds that Lew insists are the equivalent of publicly held bonds.

Why? Because the intragovernmental bond is nothing more than a bookkeeping device that records how much one part of the U.S. government (Treasury) owes another part of the same government (the Social Security Administration). In judging the creditworthiness of the United States, the world doesn’t care what the left hand owes the right. It’s all one entity. It cares only what that one entity owes the world.

Read more:

So, the President’s comments finally reveal what we’ve known for a long time: There is no “Lockbox,” and there is no money set aside to pay for Social Security. It’s been long since spent. It’s about time to stop believing the lies of the liberals and face the facts.

We have no money.



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3 Responses to “NewsFlash: President Obama Confirms there is no Social Security Lockbox”

  1. Justt Saay Noww Says:

    And the reason we have no money it’s because it was blown on the Bush wars!

    • thomasjeffersonclubblog Says:

      Oh good grief. Let George Bush go already! Obama has outspent Bush by trillions.

      You won’t find me supporting Bush, because he spent far too much money as well, but he was “bush league” (ha!) compared to Obama.
      tjcblog staff

  2. Bob Guzzardi, Ardmore Penna. Says:

    Exactly. Aren’t we told that Social Security isn’t bankrupt? That the liabilities and obligations are backed up by US bonds?
    Poetry and Lies. WE HAVE NO MORE MONEY! Thanks this is good one and thanks for reposting Charles Krauthammer article

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