Re: “System needs overhaul” (letter, 7-22).
The letter shows that there is still a strong effort to undermine the Social Security system through blatant misrepresentations. To get answers to questions about the trust fund one should go here rather than believe the phony talking points that appear in columns and letters to the editor.
The letter writer claims that the special issues to Social Security are “worthless IOUs,” even though the investments held by the trust fund are backed by the full faith and credit of the U.S. government. The government has always repaid Social Security, with interest, on demand. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the federal government.
The potential problem of fund shortage is related to the intent of congressional Republicans to block the Treasury from paying out all funds, including redemption of the special issue notes held by Social Security. It is as if your bank declined to fund checks that you had written even though your account held sufficient funds.
The effective interest rate is far above that of any savings accounts or bank deposit and better than most blue chip stocks.
The public needs to become better informed on this important subject rather than accepting the word of persons whose real intent is to undermine the system.