May 26, 2005
Social Security explained
Tell me again what’s in those filing cabinets:
Now, the system is pay-as-you-go – that means when you pay in, we go ahead and pay out. Your payroll tax goes into a – not into a trust that we hold for your account; your payroll tax goes into an account and we pay out the money for the retirees and with any money left over, we spend it on general government. It’s important for people to understand that aspect of Social Security. In other words, it’s not a trust. In other words, we’re not taking your money and holding it for you and then giving it back to you when you retire. We’re taking your money, we’re spending it on current retirees, and in that more money is coming in that needs to go out for the retirees, we’re spending on other programs. And all that’s left behind in Social Security is a group of file cabinets with IOUs in it. That’s the way the system works. It's called pay-as-you-go.
Our president, totally on top of his game.
See, in my line of work you got to keep repeating things over and over and over again for the truth to sink in, to kind of catapult the propaganda.
Got it. Definitely got it.
Those IOUs, by the way—weren’t they worthless or something?
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