Seriously, Is The Money There???

Porkopolis Economics: Episode 148

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Porkopolis Economics covers macroeconomics, money, and sports from the creator of the Crypto Voices podcast, Matthew Mezinskis.

This episode was recorded on September 24th, 2024.

In this episode, Matthew discusses the current state and future challenges facing Social Security. While the Social Security trust fund currently holds $2. 8 trillion in assets from past surpluses, it is projected to be depleted by 2034, raising concerns about the program's long-term solvency.

Matthew explains that the rapid growth of the trust fund assets is due to compounding interest. Still, the surpluses themselves were not actually saved or invested - they were spent by other government agencies. The Social Security trust fund assets are an accounting fiction, and any deficits in the program are effectively covered by general tax revenue, leading to double taxation. The trust fund is not an actual savings account, and Social Security operates on a "cash in, cash out" basis, with negative flows increasing the national debt.

Figures pulled from 2024 Social Security Administration Supplement: https://www.ssa.gov/policy/docs/statcomps/supplement/2024/index.html

Table 4.A1: Old-Age and Survivors Insurance Trust Fund: Receipts, expenditures, and assets, 1937–2023 (in millions of dollars)

Table 4.A2: Disability Insurance Trust Fund: Receipts, expenditures, and assets, 1957–2023 (in millions of dollars)

00:00:00 - The Social Security Trust Fund: A Financial Balancing Act
00:02:10 - Social Security Trust Fund: Fact or Fiction?
00:04:09 - The Power of Social Security's Trust Fund
00:05:46 - The Rise of Social Security Surpluses and Compounded Interest
00:06:54 - Social Security's Surplus Spending
00:08:57 - Government's Debt and Lack of Savings
00:10:19 - Government Spending and the Illusion of Social Security Surplus
00:12:21 - Funding Social Security Deficits through Trust Fund Interest
00:13:53 - The Financing of Social Security by the Government
00:15:38 - The Myth of Social Security Trust Funds
00:17:21 - The Accounting Fiction of Social Security's Assets

Host: Matthew Mezinskis
https://porkopolis.io
Twitter: https://x.com/crypto_voices?lang=en

Show content is not investment or financial advice in any way.