“Social Security has no place in budget discussions.” Because it legally can’t.

(a) EXCLUSION OF SOCIAL SECURITY FROM ALL BUDGETS. — Notwithstanding any other provision of law, the receipts and disbursements of the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund [I.e., Social Security] shall not be counted as new budget authority, outlays, receipts, or deficit or surplus for purposes of

(1) the budget of the United States Government as submitted by the President,

(2) the congressional budget, or

(3) the Balanced Budget and Emergency Deficit Control Act of 1985.

Because of this law, you’d think uttering “Social Security” in the same sentence as “general budget deficit” would be completely off the table.  But as Nancy J. Altman explains in her most recent contribution to Huffington Post, many politicians still consistently lump OASDI in with general government spending that does add to the deficit.  In fact, she claims it’s been a feature of almost every budget proposal put forth by Congress going back years.

But if doing so isn’t in compliance with federal law, why are our elected officials still forcing Social Security and the general spending together in their budget proposals?

Easy.  If opponents of Social Security can treat the program as one more expenditure on the budget, they can rally support for program cuts–or total dissolution–under the banner of reducing the national deficit.

“Social Security adds to the deficit” is a cornerstone argument that has been used by Social Security critics ad nauseum.  And as Congress focuses on preparing the 2018 budget, we are hearing it yet again.

But make no mistake: Social Security is funded by a dedicated payroll tax coming right from the pockets of American workers for the sole purpose of paying benefits to retired workers.  Social Security is far from a “government handout.”  It is a trust.

Altman compares the off-budget nature of Social Security directly to company pension plans:

“There is nothing surprising about [Section 13301]. Private employers that sponsor pension plans are legally required to keep plan income and assets in trust, segregated from the company’s general operating fund. Under the same principle and for the same reason, the law requires that Social Security’s income and assets be held in trust, segregated from the general operating fund of its plan sponsor, the federal government.”

She also makes the point that Social Security–on top of being fully financed by workers–doesn’t have the authority to borrow money from general funds, either.

A trust funded entirely by workers with no power to take money from other federal sources?

That doesn’t sound like a federal budget concern at all.

As Congress works towards a balanced budget and updating our tax code, be wary of proposals pointing toward Social Security as a federal deficit offender–especially when that fact is being used to justify cuts like raising the retirement age.  Not only is that not true–it’s prohibited by law.

…We’ll just go ahead and say this one more time:

Social Security is not part of the U.S. budget.