Starving with a loaf of bread under your arm. The end of Social Security

The U.S. federal government is unlike state and local governments. It uniquely is Monetarily Sovereign. That means it has the infinite ability to create dollars simply by passing laws and pressing computer keys.

While state and local government can run short of dollars, the federal government cannot unintentionally run short. Not now. Not ever.

Federal Reserve Chairman Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency. There is nothing to prevent the federal government from creating as much money as it wants and paying it to somebody. The United States can pay any debt it has because we can always print the money to do that.”

Federal Reserve Chairman Ben Bernanke: “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. It’s not tax money… We simply use the computer to mark up the size of the account.”

Federal Reserve Chairman Jerome Powell stated, “As a central bank, we have the ability to create money digitally.”

Statement from the St. Louis Fed: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e., unable to pay its bills. In this sense, the government is not dependent on credit markets to remain operational.”

Social Security is a federal agency. Like all federal agencies, including Congress, the Supreme Court, the White House, the military, et al, Social Security cannot run short of dollars unless Congress and the President will it.

Congress has the infinite power to create laws, and some of these laws create dollars from thin air. So long as Congress can create laws, the U.S. always will have enough dollars for any expenditure.

In June, 2001, Paul O’Neill, Secretary of the Treasury said, “I come to you as a managing trustee of Social Security. Today we have no assets in the trust fund. We have promises of the good faith and credit of the United States government that benefits will flow.”

The so-called Social Security “trust fund” (which is not a real trust fund) never has assets other than “promises of the good faith and credit of the United States government.”

Those promises are what we call “dollars.”

Look at a dollar “bill.” At the very top it says, “FEDERAL RESERVE NOTE.” Bills and notes are promises of payment.

All dollars are promises by the federal government that it will accept dollars as payment, and so will everyone else in America. In fact, that is stated on the dollar bill: “This note is legal tender for all debts, public and private.” 

The federal government has the infinite ability to create legal tender to pay all debts.

Because the federal government cannot unintentionally run short of dollars, how can we explain the following article from MSN?

The most controversial changes proposed to save Social Security
Story by Gabriela León

As Social Security teeters on the brink of insolvency, the government is exploring various proposals to ensure its sustainability.  

While the program is not expected to disappear, the amount future retirees will receive is uncertain.

Have you ever heard that the White House, Congress, or the Supreme Court are “teetering on the brink of insolvency“?

No?

For the fiscal year 2024, the United States Supreme Court had a discretionary budget request of $161.3 million. Where did it get the money? There is nothing like a FICA tax to supposedly support this federal agency.

For the fiscal year 2025, the U.S. Congress has an approximately $5.9 billion budget. This budget covers the operational expenses of the House of Representatives and the Senate, including salaries, office expenses, and other administrative costs. Where did it get the money? There is nothing like a FICA tax to supposedly support this federal agency.

The White House’s annual operating budget is part of the overall budget of the Executive Office of the President (EOP). For the fiscal year 2025, the EOP has a budget request of approximately $714 million. Where did it get the money? There is nothing like a FICA tax to supposedly support this federal agency.

The answer to the questions: All federal agencies get their spending money the same way. Congress votes; the President approves; and magically, the dollars are created from thin air.

Social Security is a federal agency. Like all other federal agencies, Social Security gets its money from Congress’s votes and the President’s approval.

Contrary to popular wisdom, Social Security does not get its spending money from the FICA tax or any other source. Those FICA dollars ripped from your paycheck are destroyed the moment they reach the U.S. Treasury.

The dollars originate in checking accounts as part of the “M2 money supply measure.” When they reach the Treasury, they instantly cease to be part of any money supply measure. Effectively, they are destroyed.

Among the proposed changes, some have sparked significant controversy and resistance among the American public. A survey by the National Academy of Social Insurance (NASI) highlights six proposals that have met with strong opposition.

One of the most debated proposals involves the taxable earnings cap. This cap determines the portion of a person’s income subject to Social Security payroll taxes.

In 2025, the cap is set at $176,100. Most Americans earn below this threshold, paying taxes on their entire income, while wealthier individuals do not.

Many advocate for raising or eliminating this cap to increase contributions from the wealthiest, though this alone won’t resolve the funding crisis. The NASI survey indicates that maintaining the current cap, with only minor inflation adjustments, is unpopular.

The taxable earnings cap is an invention of the rich, to widen the income/wealth/power Gap between the rich and the rest.

Another contentious proposal is gradually raising the full retirement age (FRA) to 69. The FRA, which determines eligibility for full benefits, was previously increased from 65 to 67.

Raising it further would effectively reduce benefits for younger workers by increasing penalties for early claims and decreasing delayed retirement credits. This change is seen as a benefit cut, particularly affecting those who claim benefits in their early-to-mid-60s.

This is the “work-’til-you-die” provision that Republicans love. It penalizes those who are not rich, because they are the ones who rely on SS to survive.

Reducing cost-of-living adjustments (COLAs) is also on the table. COLAs are annual adjustments to help benefits keep pace with inflation but also increase program costs. Many seniors oppose reducing COLAs, as Social Security’s buying power has already declined.

The Senior Citizens League reports a 20% loss in buying power since 2010. There’s a push to calculate COLAs based on the Consumer Price Index for the Elderly (CPI-E), which would likely result in higher adjustments but also increase expenses.

If you are hoping to receive SS, and are not rich, but you voted for Trump, you’re getting what you voted for: Delayed SS benefits.

Increasing benefits by $250 per month for all new beneficiaries is another proposal that hasn’t gained much support. This increase wouldn’t benefit current recipients or address the issue of COLAs not keeping up with inflation.

The NASI survey found this proposal less popular than others, such as raising COLAs.

It’s not clear how this would address the phony Social Security Trust Funds so-called “insolvency.” But handing out money is a good idea.

Raising the taxable earnings cap to $ 350,000, while paying wealthier beneficiaries more, is another controversial idea. Although many support raising the cap, they oppose larger checks for high earners.

The current benefit formula replaces a smaller portion of pre-retirement income for high earners. Altering the formula to prevent larger checks for those paying more into the program would require congressional action.

The real problem is with the words, “taxable earnings.” Currently, FICA is calculated against salaries but not other taxable earnings, such as capital gains. Most of the rich do not receive significant salaries. They are too smart for that. Their income is from capital gains, stock swaps, etc. — stuff you middle-class workers seldom enjoy.

Lastly, a bridge benefit for retired workers with declining health has been proposed. This would reduce early claiming penalties for those in physically demanding jobs.

While there’s demand for this change, details on its implementation and criteria are lacking.

Ultimately, the solution to Social Security’s challenges may involve some or none of these proposals, as Congress decides the best course of action.

The solutions to “Social Security’s challenges” are:

1. Learn the facts about federal finance and acknowledge the federal government’s infinite ability to create dollars and to determine their value (i.e. control inflation).
2. Eliminate FICA. Fund Social Security by Congressional vote, like nearly all federal agencies are funded. Get rid of the fake Social Security “trust fund.” It’s not a source of dollars but rather a limit on dollars and an excuse for cutting benefits to those who are not wealthy. It’s as illogical as the current debt-limit laws.
3. Pay everyone of all ages a Social Security benefit, regardless of income. Elon Musk would receive the same benefits as the poorest, homeless adult. It would mean nothing to Musk but be a life saver to the poor person. (My current suggestion is about $3,000 per month for each adult and $1,500 per month for each child, with subsequent additions for inflation.)

Rodger Malcolm Mitchell

Monetary Sovereignty

Twitter: @rodgermitchell

Search #monetarysovereignty

Facebook: Rodger Malcolm Mitchell;

MUCK RACK: https://muckrack.com/rodger-malcolm-mitchell;

https://www.academia.edu/

……………………………………………………………………..

A Government’s Sole Purpose is to Improve and Protect The People’s Lives.

MONETARY SOVEREIGNTY

Source: https://mythfighter.com/2025/03/10/starving-with-a-loaf-of-bread-under-your-arm-the-end-of-social-security/