1982: Reagan appoints Alan Greenspan to head the National Commission on Social Security Reform (The Greenspan Commission). The Commission calls for a payroll (FICA) tax hike to build up reserves in the Social Security trust fund to cover the years after the baby boom generation retires and Social Security begins running deficits.
1983: Social Security amendments are enacted, hiking payroll taxes to generate said surpluses in the trust fund.
1985: As the first surplus payroll taxes come in, they are shunted to the general fund and used to supplement other government programs. None of the money is saved or invested anywhere. Social Security revenue from working Americans ends up replacing revenue lost to Reagan’s big income tax cuts. More succinctly: The additional taxes U.S. workers pay into Social Security are used to fund tax breaks for the rich. It goes on to this day, to the tune of $2.5 trillion in all.
1987: Greenspan succeeds Paul Volker as chairman of the Fed, a position he holds until January 31, 2006. Just sayin'.
1990: Greenspan Commission member Senator Daniel Patrick Moynihan of New York, a major advocate of the 1983 amendments, becomes incensed upon finding that first Reagan then George H.W. Bush co-opted the surplus Social Security revenue for other government functions instead of reserving and growing it for the baby boomers. Moynihan's suggestion that, if the government couldn't keep it's paws off the money, the fund should be dissolved is ignored by President Bush the First. Of course.
Next time someone tells you Social Security is dragging the country down and must be cut, cut, cut, here's what they're really saying:
Thanks for the loan.
When you're ready to retire, piss off.
This year (and every year since 2006) the Post Office is legally required to make a $5 billion annual contribution to a retirement account to pay for future retirees who aren't even born yet. That's 7 years totaling $35 billion so far.
This is a scheme to kill the postal service and privatize it because it is a hugely successful government program that people like. Republicans hate government, so a successful government program must be broken and destroyed. In light of that, one wonders how much of that money is still sitting there.
Just a thought.