It is not a claim, it is a fact. The SSTF contains non-market T-bills [redeemable only by the USG] and they are interest bearing. They represent an unfunded liability, which is why the SSTF is included in the $13.1 trillion national debt as part of "Intra-governmental Holdings."
Although I don't support kicking the can down the road, SS is relatively easy to fix. It is really just a matter of arithmetic. You can use a combination of measures including extend the retirement age for full benefits, increase the payroll tax, change the COLA forumla, raise the cap faster than currently is the case, etc. Medicare is much more difficult to fix.
How does one pay interest to ones self?
"Although I don't support kicking the can down the road, SS is relatively easy to fix. It is really just a matter of arithmetic. You can use a combination of measures including extend the retirement age for full benefits, increase the payroll tax, change the COLA formula, raise the cap faster than currently is the case, etc. Medicare is much more difficult to fix."
This can only be done for a limited period of time before the system collapses. Look at it this way. Say there are 100 people on SS and 1000 people employed and paying taxes into the SS system from which the retired folks are being paid. Each year a few more people retire, reducing the amount going into the SS fund while the number of folks collecting these funds has risen. You can extend the retirement age all you want but as long as you want and in the beginning that will help but as long as the pool of workers is shrinking and the number of retirees is growing the system cannot remain viable.
The average lifespan is around 80 years while the retirement age is around 67 for full benefits. How high do you want it to go? How about we raise it to 82 so people pay into up until the day they die and nothing is ever paid out in the majority of cases?
Private plans, even if the money is ONLY allowed to be put into CD's will give a wage earner with an average wage of just $40,000 throughout his life a nest egg of $555,000 at age 65 (I assumed just 3% interest compounded 1 time annually). Right now I can put this money in a guaranteed lifetime annuity which would pass to my wife should I die, and get $2312.00 per month. Also if my wife worked (likely) she would get the same from her account, which means a total of $4600 per month. based on average of $40,000 annual earnings for 2 people this is far more then SS would ever pay AND the remaining money upon death of the recipient is passed on to the spouse or whomever is the designated beneficiary. There is absolutely NO reason NOT to privatise the SS system and do so immediately. The sole reason it is not being done is purely political.