{"id":3019,"date":"2026-07-15T10:40:41","date_gmt":"2026-07-15T10:40:41","guid":{"rendered":"https:\/\/interstatelogisticshubs.com\/?p=3019"},"modified":"2026-07-15T10:40:41","modified_gmt":"2026-07-15T10:40:41","slug":"the-hidden-cost-of-saving-the-economy","status":"publish","type":"post","link":"https:\/\/interstatelogisticshubs.com\/?p=3019","title":{"rendered":"The hidden cost of saving the economy"},"content":{"rendered":"
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Social Security has been a testament to the inability of a government to effectively manage anything.\u00a0\u00a0The debacle that we are facing with the projected shortfalls in the trust funds, which have been talked about for decades, is now just six years away.\u00a0\u00a0Such a short time for such a massive investment fund means the fund is in survival mode now!<\/p>

Read more \u2018Developer Mania\u2019 Threatens What America Has Always Been<\/a><\/p>\n

Decisions not made by prior administrations and the public\u2019s inability to hold government accountable are about to come crashing in monumental way.\u00a0\u00a0The most difficult decisions in leadership are seldom between right and wrong.\u00a0\u00a0They are usually between two imperfect alternatives.<\/p>\n

Leaders choose the course they believe will produce the greatest good while minimizing the greatest harm.\u00a0\u00a0Only years later do history and experience reveal consequences few could have anticipated.\u00a0\u00a0The true measure of stewardship is whether we are willing to recognize those unintended consequences, learn from them, and make the next decision wiser than the last.<\/p>\n

Social Security deserves nothing less.\u00a0\u00a0We, the people, were forcefully committed to investing in Social Security.\u00a0\u00a0Decades of deposits were made from every paycheck.\u00a0\u00a0We did our part to participate, willing to or not.<\/p>\n

Every payday, money was deposited.\u00a0\u00a0Every year, you expected those savings to earn a reasonable return.\u00a0\u00a0You weren\u2019t looking to get rich.\u00a0\u00a0You simply trusted that your retirement would be managed responsibly.\u00a0\u00a0That expectation is enforced by regulators with investment fund managers but not with Social Security.<\/p>\n

In 2008 and 2009, the U.S. economy was whipsawed by the Great Recession, the Federal Reserve responded with a program of quantitative easing that dropped interest rates to near zero levels for over a decade.\u00a0\u00a0That decision, which affected Social Security investments, which are restricted to U.S. government securities, devastated the fund\u2019s earnings every year for over 15 years now.<\/p>\n

Every financial decision has a cost.\u00a0\u00a0Almost always, the people who pay that cost are not the ones who made the decision.<\/p>\n

Following the financial crisis of 2008, the Federal Reserve faced one of the greatest economic challenges in modern American history.\u00a0\u00a0Banks were failing.\u00a0\u00a0Credit markets were freezing.\u00a0\u00a0Millions of jobs were at risk.\u00a0\u00a0Policymakers had to make extraordinarily difficult decisions with incomplete information while financial markets deteriorated around them.<\/p>\n

Reasonable people can debate whether quantitative easing was the best response.\u00a0\u00a0Historians and economists undoubtedly will for decades.<\/p>\n

What happens when one allegedly well intended solution quietly creates another problem that almost no one notices or cares until it is almost too late?<\/p>\n

Quantitative easing was designed to stabilize financial markets and lower borrowing costs throughout the economy.\u00a0\u00a0By purchasing large amounts of Treasury securities and mortgage-backed securities, the Federal Reserve pushed interest rates to historically low levels.\u00a0\u00a0Those lower rates helped businesses borrow, encouraged investment, supported housing markets, and contributed to economic recovery.<\/p>\n

Certificates of deposit that once earned meaningful returns paid almost nothing.\u00a0\u00a0Savings accounts generated little income.\u00a0\u00a0Retirees who depended upon interest from conservative investments suddenly found themselves earning far less than they had planned.<\/p>\n

Many adjusted to the new reality by postponing retirement and reducing spending or curtailing their lifestyle.\u00a0\u00a0Many lost their homes.<\/p>

Read more Trump Is Righting Latin America<\/a><\/p>\n

What few people realized was that the Social Security Trust Fund was experiencing something remarkably similar with no legislative authority to stop the hemorrhage for more than 10 years.<\/p>\n

Unlike virtually every major public or private pension system in America, the Social Security Trust Fund is required by law to invest exclusively in special-issue United States Treasury securities.\u00a0\u00a0That investment policy was designed decades ago to maximize safety.<\/p>\n

It also meant the Trust Fund had no opportunity to diversify its investments when interest rates fell to historic lows.\u00a0\u00a0Its trustees had no discretion.\u00a0\u00a0They could not seek higher long-term returns.\u00a0\u00a0They could only invest as Congress had directed.\u00a0\u00a0As Treasury yields declined, so did the earnings credited to the Trust Fund.\u00a0\u00a0No one intended to reduce Social Security\u2019s investment income but that was precisely what happened.<\/p>\n

The Federal Reserve was not managing Social Security.\u00a0\u00a0It was managing monetary policy for the nation\u2019s economy and yet the consequences extended well beyond financial markets.\u00a0\u00a0Over time, those lower investment returns reduced the growth of the Trust Fund by an amount that many analysts estimate in the trillions of dollars.<\/p>\n

This is an accounting and economic reality.<\/p>\n

Throughout my career as a CPA, a legislator, and later a trustee of one of the nation\u2019s largest public pension systems, I learned that most financial problems are not created by bad people, although that does happen.\u00a0\u00a0They are created by good people trying to solve extraordinarily difficult problems without fully understanding the unintended consequences or accountability for those solutions.<\/p>\n

The real question is whether we are willing to learn from the consequences we never intended.\u00a0\u00a0That principle should guide today\u2019s discussion about Social Security.<\/p>\n

For years, we have been told that the only choices are higher taxes, lower benefits, or a later retirement age.\u00a0\u00a0But before asking workers and retirees \u2014 people who faithfully paid every payroll tax required of them \u2014 to shoulder additional burdens, shouldn\u2019t we first examine whether the structure of the Trust Fund itself contributed to today\u2019s challenges?<\/p>\n

Shouldn\u2019t we ask whether requiring every dollar to remain invested in a single class of government securities continues to represent the best stewardship of the American workers\u2019 retirement contributions?\u00a0\u00a0Those are not political questions but fiduciary questions.<\/p>\n

Social Security has become one of the most successful social insurance programs in American history because generations of workers kept their promises.\u00a0\u00a0They went to work.\u00a0\u00a0They paid their payroll taxes.\u00a0\u00a0They trusted that the system would be responsibly managed and it was not.\u00a0\u00a0Social Security became a weapon in the arsenal of monetary policy and not<\/em> a financially prudent investment decision.\u00a0\u00a0The system was designed with a massive flaw from the onset, and it must be fixed if it is too survive.<\/p>\n

And that is how we preserve Social Security: by becoming better stewards of its future, and not punishing those who did nothing wrong.<\/p>\n

Frank Ryan is a CPA, retired U.S. Marine Corps Reserve Colonel, former member of the Pennsylvania House of Representatives, and former vice chair of the Pennsylvania Public School Employees\u2019 Retirement System (PSERS).<\/em><\/strong><\/p>

Read more Western Governments Have a Shelf Life<\/a><\/p>\n

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\"<p><em>Image:<\/figure>\n<\/em><\/strong><\/p>\n

Image: pasja1000 via Pixabay, Pixabay License.<\/em><\/em><\/strong><\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

Social Security has been a testament to the inability of a government to effectively manage anything.\u00a0\u00a0The debacle that we are facing with the projected shortfalls in the trust funds, which have been talked about for decades, is now just six years away.\u00a0\u00a0Such a short time for such a massive investment fund means the fund is […]<\/p>\n","protected":false},"author":1,"featured_media":1700,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[122,49],"tags":[1231],"class_list":["post-3019","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics","category-economy","tag-related-topics-economics-social-security"],"yoast_head":"\nThe hidden cost of saving the economy - Interstate Logistics Hub<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/interstatelogisticshubs.com\/?p=3019\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The hidden cost of saving the economy - 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