>>The trust fund does not contain assets, just unfunded liabilities, which is why the trust funds are included in the $14.3 trillion national debt. <<
I think you’ll find that the trust funds contain the other 5$ trillion or so of the debt issued under the $14.3 trillion debt ceiling. That is, they contain the non-public portion of the debt issued under the ceiling, the portion that you are referring to as an IOU.
You acknowledge as much when you say the trust funds are included in the national debt.
I think my question is a valid one. What’s to stop Obama from converting at least $50 bn of the SS trust funds non-public debt into public debt? Treasury would issue $50 bn T-bills, say, and transfer the $50 bn cash to the SS trust fund, canceling $50 bn of their non-public debt (so the total debt stays at $14.3 bn). The SS trust fund now has $50 bn in cash to pay benefits. I would be surprised if this wasn’t possible to do. I’m just not sure if they’re planning to try it, because I’ve seen no suggestion of it anywhere.
Beyond that, there are other trust funds that could be treated similarly. And then there’s the question of what would happen if they just raided the trust funds of however much non-public debt as they needed.
I don't see any utility to that. SS is now running in the red, so it is already cashing in its IOUs, which more than likely adds to the public debt since we borrow 41 cents of every federal dollar spent. And the publicly held debt is far more dangerous to the health of the nation than owing the money to ourselves. The Chinese and anyone else can buy the market T-bills.
Treasury would issue $50 bn T-bills, say, and transfer the $50 bn cash to the SS trust fund, canceling $50 bn of their non-public debt (so the total debt stays at $14.3 bn).
Where is the government going to come up with the additional $50 billion? We are already at the limit of our debt. Treasury must have buyers. And to what end would that serve? Cash from where? What is the advantage of increasing our public debt and decreasing our Intraovernmental debt?
The SS trust fund now has $50 bn in cash to pay benefits. I would be surprised if this wasn’t possible to do. I’m just not sure if they’re planning to try it, because I’ve seen no suggestion of it anywhere.
You have lost me. SS already has a revenue stream. Right now it is running in the red, which is why it is cashing in some of its T-bills to pay benefits. The General Fund is redeeming these IOUs so SS can pay benefits. The impact on the national debt is neutral.
Beyond that, there are other trust funds that could be treated similarly. And then there’s the question of what would happen if they just raided the trust funds of however much non-public debt as they needed.
I provide you with the CBO description of the trust funds. They don't contain assets, just unfunded liabilites. Why would anyone "raid" a trust fund for IOUs? What the USG is doing now is to take some of the money from trust funds that are running a surplus and using that money to pay bills. SS is not running a surplus nor is the Medicare trust fund.