Allen W. Smith, Ph.D.
The author says that it appears that President Reagan put Social Security on a premature path to insolvency through a payroll tax hike in the early 1980s and offers an analysis of why he believes this happened.
The author says that the purpose of the 1983 payroll tax hike was to generate Social Security surpluses for the next 30 years, but instead of following that plan, the government spent the money out of the general fund, thus using up the revenues on other government programs.
The author says that the Social Security Trust fund is empty and has been for the past 30 years, but the public has been deliberately mislead to believe that the funds are still in place.
The author says that the debate over funding Social Security is focused on the wrong problem and that the real problem is that the government has spent all of the trust fund holdings, starving the program of all its surplus monies.
The author says that the Social Security trust fund does not contain any marketable bonds and that all surplus revenue has been spent.
The author says that claims about Social Security’s ability to pay benefits continue to be made but that they are not true. He offers a breakdown of the program’s financial status.