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Last year, the under-65 set paid Uncle Sam $390 billion in Social Security
taxes, and he paid $332 billion to the over-65 set. The leftover $58
billion went into a so-called trust fund, with which the government bought
treasury bonds and then spent them--standard practice with the diminishing
leftovers:
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"While there are supposedly enormous surpluses currently being generated in
the system, these surpluses are not put into a separate account for each
taxpayer--or even put into a separate account at all. Under current law,
Social Security is required to furnish any excesses to the U.S. Treasury to
cover current deficits or to refinance the national debt. Therefore the
so-called surpluses disappear as soon as they accrue. While in theory, the
treasury must repay these funds, the money to do so simply comes from the
taxes that are collected each year. Whether future taxpayer dollars
are earmarked to repay the debt or to repay the Social Security fund is
little more than an accounting question. The surpluses are a myth." --Geoffrey T. Holtz, from Welcome to the Jungle: The Why Behind "Generation X" (St. Martin's Griffin, 1995)
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