Michael Hansen’s (10/14, Letters) says that the “government spends 100 percent of the Social Security funds it receives and promises to pay all future Social Security payments out of future tax collections.” Not exactly.
FICA taxes go into trust funds, out of which come benefit payments and administrative expenses. The excess is invested in government bonds. These bonds pay interest regularly back into the trust funds.
To say that these bonds are worthless is the same as saying that the treasury bonds that private investors hold are worthless or even that every $20 you have is worthless, because “nothing backs them up.”
Well, the full faith and credit of the United States back them all up. The system works without gold bars or overflowing vaults because America works. You can be assured that if America doesn’t work, the stock markets won’t work, either.
Anyone who considers the full faith and credit of the United States to be worthless has far more to worry about than Social Security.
Max J. Skidmore