00:00:00
the US Social Security program is meant
00:00:02
to be kind of the retirement program for
00:00:04
folks that don't have access to private
00:00:06
retirement accounts this program was set
00:00:08
up in the 1930s after the Great
00:00:11
Depression there's a trust fund the
00:00:13
OASDI which is the fund that they invest
00:00:15
the capital so every year we all put
00:00:17
money in with our social security taxes
00:00:18
out of our paychecks goes in there it
00:00:20
gets invested in one thing us treasuries
00:00:22
which have averaged about
00:00:23
4.8% return since the beginning of the
00:00:26
program per year meanwhile the S&P has
00:00:28
been averaging 11% so here's the map if
00:00:30
in 1971 which was the year that we went
00:00:33
off the gold standard in the United
00:00:34
States if we invested the Social
00:00:36
Security trust fund in the S&P the
00:00:38
balance of the Social Security trust
00:00:40
fund today would be $15 trillion that
00:00:42
would be roughly onethird of the value
00:00:44
of the total s&p500 which would be
00:00:47
jointly owned by all Americans now
00:00:49
here's what's up the middle class people
00:00:51
who had access to private retirement
00:00:53
accounts benefited by buying the S&P 500
00:00:55
and the wealthy were able to access it
00:00:57
so all of the equity value that accured
00:00:59
from American Enterprise and the
00:01:01
prosperity of the American system
00:01:03
accured to the people that had access to
00:01:04
the private accounts meanwhile the
00:01:06
people that only had access to the
00:01:07
Public Accounts got stuck owning
00:01:09
treasuries today the Social Security
00:01:11
trust fund has $2.7 trillion balance and
00:01:13
based on the outflows and inflows it's
00:01:15
going to go bankrupt in 2032 so I did
00:01:17
the math if you assume that the S&P 500
00:01:20
continues to grow at 10 a half% a year
00:01:22
on average we could put about $500
00:01:24
billion in the trust fund today and it
00:01:25
will not go bankrupt again and it will
00:01:27
continue to grow every year and then all
00:01:29
americ Americans have participation in
00:01:31
American Enterprise and importantly this
00:01:33
becomes the world's largest Sovereign
00:01:34
wealth fund ever you don't need a
00:01:36
separate Sovereign wealth fund we
00:01:37
already have one we've totally
00:01:39
mismanaged it and I went back to trying
00:01:40
and understand why this is the case why
00:01:42
have we only ever bought treasuries
00:01:44
early on the US needed someone to loan
00:01:46
money so they basically forc the
00:01:47
citizens to loan the government money in
00:01:49
the form of treasuries but today the
00:01:51
Social Security trust fund owns less
00:01:54
than 10% about 8% of the total treasury
00:01:56
bonds outstanding so why are we forcing
00:01:58
all the American citizens to partip for
00:02:00
no reason through the Social Security
00:02:01
System we've created the Deep inequity
00:02:03
we see in this country If instead we had
00:02:05
allowed the social security system to
00:02:07
invest in the S&P 500 to buy American
00:02:09
Enterprises to fund American businesses
00:02:12
then every American would be wealthy and
00:02:14
that middle class that uniquely
00:02:16
participated by basically arbitraging
00:02:18
the market where they forced the
00:02:19
treasury bond yields on the poor and
00:02:21
they got to take access to the equity
00:02:23
yields would have not happened