… is from pages 42-43 of Thomas Sowell’s October 2001 column titled “Social Security ‘Trust Fund’,” as this column is reprinted (with slight modification, and under the title “Social Security vs. Privatization”) in Sowell’s 2002 collection, Controversial Essays:
When your Social Security taxes get to Washington, they are spent – right then and there. What preserves the illusion of a “trust fund” is that the Social Security system is given government bonds in exchange for the money that Congress takes and spends. But, no matter what kind of accounting sleight-of-hand you use, you cannot spend and save the same money.
Those bonds in the Social Security “trust fund” represent no tangible assets – not houses, not factories, not cars, not trains. They are promises that can be kept only by taxing future taxpayers.
It’s astonishing how many seemingly intelligent people have been duped over the years into believing that Social Security’s so-called “trust fund” is something more than a mere gimmick meant to fool the public. And it’s at least equally astonishing that so many people continue to look to the perpetuator of this gimmick, the state, as a trustworthy source of protection from fraud, deceit, and financial improprieties.