"Trust Fund balances are available to finance future benefits...but only in a bookkeeping sense...they do not consist of real economic assets that can be drawn down in the future to fund benefits. Instead, they are claims on the Treasury that, when redeemed, will have to be financed by raising taxes or borrowing." President Bill Clinton in his Analytical Perspectives section of the 2000 budget.

"We have no positive assets in the Social Security Trust Fund." Secretary of the Treasury, and one of the trustees, Paul O'Neill, June 19, 2001, at a luncheon speech to the Coalition for American Financial Security in the Sky Room of the World Trade Center and later to Sam Donaldson on This Week, Sunday, June 25, 2001.

"It holds no real assets. Consequently, it does not generate funds to pay future benefits. These so-called trust fund 'assets' simply reflect the accumulated sum of funds transferred from Social Security over the years to finance other government operations." June O'Neill, former Director of the Congressional Budget Office (CBO) at the CATO Institute's Conference for Women and Social Security.

"You know, one thing about Social Security -- sorry to blow on here, but now that you asked -- a lot of people in America think there is a trust. Your money goes in, the government holds it, and then the government gives your money back when you retire. That's just not the way it works. And it's important for the American citizens to understand it's a pay-as-you-go system. And right now, we're paying for a lot of programs other than Social Security with the payroll tax coming in, thereby leaving a pile of IOUs." George W. Bush in a press conference on 3/16/2005.

"Government trust funds do not correspond in any meaningful way to those in the private sector. Government trust funds are simply a form of earmarking, accounting mechanisms that record tax receipts, user fees, and other credits and associated expenditures," Barry Anderson of the Congressional Budget Office in testimony before the House Budget Committee, September, 2002.

"We are going to get no help from the so-called Social Security Trust Fund. The Fund is a collection of non-negotiable government bonds in a filing cabinet in West Virginia. Investing in Treasury certificates is a good idea unless you are the Treasury. The idea that somehow this represents anything other than records kept on money collected by Social Security taxes that had been spent on other programs in the last 20 years is a complete fraud. When the president talks about using the Trust Fund to extend the life of the Social Security program for 24 years, he is wrong. We are misleading people into thinking that this Trust Fund has any relevance whatsoever. From an economic and a legal point of view, there is no Trust Fund." Former Senator Phil Gramm at the Economic Club of New York.

"Currently, the Social Security system is running a surplus, taking in more in taxes than it spends on benefits. That surplus is used to purchase government bonds -- the only purpose to which it can be put(not true). The purchase of those bonds generates general revenue for the federal government and that money is spent on the operations of the federal government. That is a bad system, but it is how the trust fund was designed to work. The fund does not hold cash, never has held cash, and was not designed to hold cash." Michael Tanner-CATO Institute 10-16-99 "Pointless Debate Over SS Trust Fund"

"It is in this role as a savings account that the Trust Fund could fail. It cannot work because it holds no independent assets. Though the Trust Fund is backed by government securities, these have a different meaning than they would for you or me. If I hold a government bond, I have an asset that the government will give me money for or that I can sell at any time. If the government holds a bond, however, its obligation to give itself money is meaningless. The government cannot make these bonds good, as needed in 2014, except by borrowing, reducing other expenditures or taxing citizens." House Budget Committee Chairman Nick Smith 6-8-99

"In fact, the money the government has supposedly been putting aside from the Baby Boomers' Social Security taxes is not there. The government has been borrowing the money to pay for the budget deficit. The Social Security Trust Fund is simply IOUs from the U.S. Treasury.... [Social Security] would be fine if the government would stop borrowing the money." Newt Gingrich 4-7-95

"Although there is no money in the Treasury to pay for future obligations, the obligations to people eligible for Social Security benefits are real. And most important, those obligations are a direct result of federal law, not a consequence of whatever may or may not be credited to the Trust Funds. In particular, the size of the balances in the Social Security Trust Funds -- be it $2 trillion, $10 trillion, or zero -- does not affect the obligations that the federal government has to the program's beneficiaries. Nor does it affect the government's ability to pay those benefits." CBO Director Dan L. Crippen and Deputy Director Barry B. Anderson, in testimony before the House Ways and Means Committee, February 23, 1999.

"The truth is that the Social Security Trust Fund has already been stripped bare. There is no trust and no fund. It is a lot like the S&Ls. The savings and loans had a lot of real estate on the books, a lot of property, a lot of shopping centers, a lot of deposits, and everything else, until you looked inside and found out there was nothing there. The assets were mostly on paper.... Meanwhile, the Social Security cupboard is bare." Senator Ernest “Fritz” Hollings (D-SC) Congressional Record 4-24-91

March 8, 2002, the White House Bulletin contained the following paragraph: "A reporter (unnamed) asked Senate Majority Leader Tom Daschle this morning, 'One of the other things that may have happened before the break is, the Administration's request for an increase in the debt ceiling, which they said, as of their last communication, I think, would be reached by late March when you go out (in recess). Over on the House side, House Republican Chairman Cox has put forward a proposal that I think the leadership is considering to redefine national debt and make it only the publicly held debt, which is, I think, about $3.6 trillion instead of the overall $5.9 trillion. By doing that, it would allow Congress to vote for a reduction in the national debt rather than the $700 ($750) billion increase that the administration supported. Do you support that on a policy basis to redefine national debt as only the debt held by the public and not the intergovernmental (Intragovernmental Holdings) transfers that make up the rest of it?' Dashle brushed off the question by making a joke of the longest question he had ever been asked and the shortest answer. No.

"Social Security's Trust Funds are not like private Trust Funds. They are simply budget accounts used to record receipts and expenditures earmarked for specific purposes. A private Trust Fund can set aside money for the future by increasing its assets. However, under current law, when the Trust Fund's receipts exceed costs, they are invested in Treasury securities and used to meet current cash needs of the government. These securities are an asset to the Trust Fund, but they are a claim on the Treasury. Any increase in assets to the Trust Funds is an equal increase in the claims on the Treasury." David Walker, Comptroller General of the United States in an article titled "Social Security And Surpluses: the Government Accounting Office (GAO) Perspective on the President's Proposals" February 23, 1999.

"The Enron case made headlines because fraud and deception of such magnitude is fairly unusual in the corporate world. Washington fraud and deception of a much greater magnitude doesn't make the headlines because fraud and deception in government is standard practice....Washington politicians have for decades been doing precisely what Enron has been accused of doing -- concealing debt with accounting tricks. Congressmen tell us that our Social Security taxes go into a trust fund to pay for future retirement pensions. That is a boldface lie. The Social Security trust fund has no money in it." Walter Williams, Professor of Economics, George Mason University in an article published by the Washington Times April 17, 2002.

"First, an immediate and significant reduction in the payroll tax will, more than any other proposal, put money in the hands of those who need it and will spend it -- across the entire income spectrum. It will give both employers and employees more cash as quickly as the next payday, thus relieving financial pressures on both. A just-released Congressional Budget Office study notes that a payroll tax cut 'would probably have a large bang for the buck' because it could induce spending and reach families with lower earnings. This action can be taken without undermining the Social Security Trust Fund or the benefits of current and future retirees." John T. Dillon, CEO of International Paper, in the Washington Post January 11, 2002, Editorial Page.

"When the money going out exceeds the money coming in, you are in trouble and that happens in 2016. Those who try to push the fatal date off to 2038 are counting the money that Social Security has in its so-called trust fund. However, the so-called trust fund exists only as a legal technicality, not as an economic reality...you cannot spend and save the same money." Thomas Sowell, The Washington Times, July 29, 2001.

"Enron's murky 'off-balance sheet' accounting practices highlighted its assets and downplayed its debts - as does Social Security's 'trust fund' accounting. While the trust fund's trillion dollars in government bonds are 'assets' to Social Security, they are debts to the rest of the government - which will have to raise taxes or cut other programs to repay them, just as if there had been no trust fund at all." Andrew G. Biggs of the CATO Institute for the Washington Times, April 4, 2002.

"It means that ordinary working Americans, like teachers, police officers and firefighters, who believe their payroll taxes are going toward their Social Security retirement are in for a surprise...Instead of going to the Social Security trust fund, their payroll contributions are being funneled directly into tax breaks for individuals and corporations" Robert Matsui (D-CA), Chairman House Ways & Means Subcommittee on Social Security, Associated Press, March 30, 2002.

"Every dollar collected in (FICA) payroll taxes is spent the very minute, the very hour, the very day it comes in the door ... any funds left over, they are spent on other programs or used to pay off the national debt. But nothing is saved. No money is stashed away in bank vaults; no investments made in real assets." John C. Goodman, President of the National Center for Policy Analysis in an article published by the Washington Times, April 12, 2002.

"Any government leader who discusses the Social Security trust fund as if it comprises real financial assets with marketable value isn't worthy of being taken seriously." Jerry Heaster, The Kansas City Star, May 11, 2002. "The trust fund is a mirage of promissory notes." July 25, 2001.

Senator Peter Fitzgerald (R-Illinois) on the Senate floor during lock-box debates, 1999: "A few years back Congress passed laws making it illegal for State and local governments to plunder the pension funds of their employees. But during all this time, where Congress has put these laws on the books and made it illegal in the private sector and at the State and local government level to plunder pension funds, we have gone on and on in Washington taking all the money that goes into the Social Security trust fund, taking every dime of it out, and spending it on some other program. As a result, as I speak now on the Senate floor, there is no money in the Social Security trust fund. All of it has been taken out and spent on other programs. They have put meaningless, nonmarketable, nonnegotiable securities in the Social Security trust fund, securities that have no economic value because they cannot be sold to raise cash. Right now our Government is building up, theoretically, surpluses in the Social Security trust fund, but they are taking all that money out and spending it. So when we actually need it to pay benefits, beginning in the year 2014, there will be no money there. No matter what the balance of those bogus IOUs is in the Social Security trust fund, in the year 2014--whether that balance is $1 trillion or $5 trillion--they are of no assistance in paying benefits to those who depend on Social Security. The country will either have to raise taxes or cut benefits to make up for the shortfall that is anticipated after the year 2014. This legislation is basic, decent common sense. We should not allow Congress to continue frittering away the Social Security trust fund. I urge all my colleagues to support it and end this outrageous practice of plundering the Social Security trust fund, to the detriment of our Nation's seniors and those who will be desiring to live on Social Security benefits in the next century." (Note: Cash never goes into the trust fund, never, not even for an instant. It is always kept in the Treasury general fund until spent.)

"Mr. President, the thrust of President Clinton's State of the Union addres was "save Social Security first." The quickest way to save Social Security is to stop looting Social Security. Over the years, we have looted the Social Security trust fund with wild abandon; we owe it to the tune of some $631 billion right this minute. It should be a $631 billion surplus. But actually, since Congress has expended it on foreign aid, defense, food stamps, and other programs in order to appear fiscally responsible, there is a deficit in Social Security." Senator "Fritz" Hollings in a letter of January 29, 1998 to the Senate.

"The Social Security trust fund does not provide the resources to close this financial gap. The non-negotiable bonds in the trust fund are essentially i.o.u.'s from the government to itself and must ultimately be repaid by taxpayers...Another targeted misrepresentation is that the Social Security Trust Fund can maintain the system from 2016 to 2038, pushing the need to do something well beyond most people's time horizons. The reason is that the trust fund consists of nothing but U.S. Treasury securities, i.e, federal government IOUs. But how will the Treasury redeem those IOUs when they come due? A 2000 Congressional Budget Office report said, 'To repay what [The Treasury] has borrowed from the trust fund, the federal government must raise the cash by boosting taxes, reducing other spending, borrowing more from the public, or retiring less debt,' making the trust funds essentially just a commitment to massive future tax increases." Thomas R. Saving, one of the Social Security trustees and professor of economics at Texas A&M University serving on President Bush's Social Security reform commission in a New York times article titled "A Social Security Solution" August 12, 2001.

"The key point is that the Trust Funds themselves do not hold financial resources to pay benefits -- rather, they provide authority for the Treasury Department to use whatever money it has on hand (taxes or borrowed) to pay them." David Stuart Koltz, Congressional Research Service, April 29, 1998.

"On January 3, 1983, Robert J. Dole, Senate Majority Leader, published an article on the op-ed page of The New York Times, entitled "Reagan's Faithful Allies." It seemed that many people thought Congressional Republicans weren't giving the President the support he needed and deserved. Not so, Senator Dole said, we are with the President and there are great things still to be done. Then this: 'Social Security is a case in point. With 116 million workers supporting it and 35 million beneficiaries relying on it, Social Security overwhelms every other domestic priority' ....That day I was being sworn in for a second term in the Senate. I had read the article and went up to Senator Dole on the Senate Floor and asked if he really thought that, why not try one last time? (They had just spent a year on the Greenspan Commission that went nowhere) And he did think it. A year of listening to Myers had altered a lifetime of Republican dogma. We met the next day. The day after that Barber Conable was brought in, a Republican who both understood and believed in Social Security. On January 15th, 13 days from our first exchange, agreement was reached at Blair House and the crisis passed...Social Security was secure for the time being. Indeed, the payroll tax generated a considerable surplus which we have lived off ever since, and will continue to enjoy for yet a few years. Moynihan at a speech delivered on Social Security Reform to the John F. Kennedy School of Government at Harvard University, March 16, 1998. Back in '83, and once Dole and Moynihan had decided on the amount of tax increase, it was within a month that Congress passed and the President signed a bill raising payroll taxes to their present 15.3 percent level over the next seven years.

"The biggest lie that is being told in this whole thing -- and it is a lie -- is that there is plenty of money in the Social Security Trust Fund to carry this thing through to 2050. It's a lie. There is no money in the trust fund." Representative E.Clay Shaw, Jr. (R-FL) House Ways & Means Subcommittee on Social Security interviewed by Doug Lyons for the Sun Sentinel, February 13, 2005.

"The Social Security trust fund is what I call a fiscal oxymoron. It shouldn't be trusted and it's not funded. And whether you have one or not, you still have to go out and do the same three things. You either have to try to borrow the money or you're going to increase taxes or you are going to cut the benefits. We;ve spent the money in the trust fund. We may have told the American people that we were setting it aside in a quote 'trust fund.' We spent it on other subjects. Shock of all shocks." Pete Peterson, head of the Concord Coalition and former Commerce Secretary. January 13, 2005.

"You see that Social Security is now taking in more cash than it spends. Ok, let's fast-forward to 2018, when Social Security is projected to take in $23 billion less cash than it spends. By then, the trust fund would have more than $5 trillion of Treasury IOUs in it. So it would be a piece of cake to cover a crummy $23 billion, right? Wrong. The fund's irrelevant, folks. It's an accounting entry, not real money." Allan Sloan, Newsweek Magazine, February 14, 2005.

“Mr. Chairman, I think an issue that’s related to this issue is that if we, and we could do this, Congress could simply do this by running the printing press and printing up more of these bonds, if there was a googol trillion dollars in the trust fund, and that’s 10 to the 100 trillion in the trust fund; or if there’s zero, the implication for the federal budget are identical after 2016. It makes absolutely no difference what’s in the trust fund, and because of this, we would argue in economics there’s nothing in the trust fund, it’s simply a promise, and as it impinges, as I pointed out earlier, both with Medicare, Medicaid and this, by 2070 one hundred percent of the federal budget will be used for these programs. And that’s assuming the federal budget grows with gross domestic product and stays a fifth of the GDP. The point is that the trust fund is irrelevant except in this legal sense, that when the trustees come to the Secretary of Treasury and hand them these certificates, they are required to give us cash and that’s only required if Congress requires them to do that, and if it’s impinging on the other aspects of the federal budget that are more important at the time, then clearly hard decisions have to be made. But it doesn’t change the actual federal revenues in any way. So it impinges on these revenues, and it’s important for I think the public to understand what the trust fund really means and changing those numbers, because they can easily be changed and the system can be made solvent in that sense of the word. We can make that trust fund anything we want to. If we want to change the interest payments, which is a suggestion that’s been made, change the rate of interest, make it 100 percent a year, we can make this last forever, but we can never actually find the real resources because retired people, as I say, drive real cars, eat real food, and live in real apartments and use real medical care, and that’s real output in the country and that’s the only thing we have. We can’t change it with writing numbers on a sheet of paper.” Thomas Saving, current trustee for the Social Security trust fund at the first meeting, June 11, 2001 , of the President’s Commission to Strengthen Social Security.

Dialog between Marilyn Moon and Ways & Means Sub-Committee Chairman on Social Security Clay Shaw, April 15, 1999. (Too long to include here, click)

In an offhand way, it can even be said that the years Congress spent debating and trying hopelessly to pass "lock-box" laws is a confession not only to the malappropriation of Social Security surpluses but the fact that existing trust funds are not real. Real trust funds are by their very nature lock-boxes.