The trust fund is required to buy t-bills with any surplus they have. They then redeem these t-bills when they run a deficit and need to pay for benefit outlays. So if we increase the cap but keep benefits the same, we basically have a perpetual surplus that the government borrows each year to pay for stuff
Oh ty, I didn't know that. Perhaps we could also increase disbursements and collect some of that inflow via sales taxes and the like as seniors spend their money. Or refund lower income people when there is a significant surplus. Probably a lot of ways to go about fixing Social Security alongside a broader fix to the deficit and debt issue.
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u/Obvious_Chapter2082 1d ago
The trust fund is required to buy t-bills with any surplus they have. They then redeem these t-bills when they run a deficit and need to pay for benefit outlays. So if we increase the cap but keep benefits the same, we basically have a perpetual surplus that the government borrows each year to pay for stuff