THERE IS NO BUDGET SURPLUS
One of the most difficult tasks facing the analyst is simply seeing through the fog to locate real numbers. Go to the website www.publicdebt.treas.gov. Here is what you will find:
Public debt on September 30, 1999: $5,656,270,901,615.43
Public debt on September 30, 2000: $5,674,178,209,886.86
How can the national debt increase when the administration claims a surplus? First, one must understand that the debt is comprised of two parts, the portion owed to the public in the form of bills, notes, and bonds (60%). The other part is borrowed from trust funds. (The first category actually did decline.)
Accounting loopholes allow the counting of federal trust fund surpluses to be counted as revenue in the budget. Federal law requires that such surpluses be invested in federal securities. Thus these funds are the debt that the government (treasury) owes to the trust fund. So the funds are expended for purposes other than which they were collected, an act which would land a private citizen in prison.
Senator Ernest Hollings (D-SC) exlained it in the February 5,1998 Washington Post:
“The deficit is not eliminated, but is merely moved from the general fund into the Social Security trust fund…”
In 1990, President Bush signed into law the Budget Act, of which Section
13301 forbids the reporting of budgets using Social Security trust funds.
So the inclusion of these funds in the budget is actually a violation of