By 2050 the savings will be completely depleted, necessitating additional taxes or borrowing. Should Government Hold Private Assets Even with the conservative rates of return assumed in the CBO forecasts, the government could postpone tax increases or additional borrowing for a long time. But there is a long history of opposition to the government's holding private financial assets. Back in the late 1930s, an Old Age Reserve Account was proposed to accumulate assets for the fledgling Social Security program. The debate focused on the prospect of the government's involvement in the private financial market.
Today there are again concerns about the government holding assets.
In January, Federal Reserve Chairman Alan Greenspan, voicing concern that political considerations could affect investment decisions, said the government should avoid holding private assets. Greenspan suggested that a better use of the surpluses would be to fund individual retirement accounts or, barring that, tax cuts. Using All Surpluses for Personal Retirement Accounts Unlike the explicit federal debt, the government's future commitments under such programs as Social Security and Medicare are not counted as part of the outstanding debt of the United States. But these implicit debts are debts just the same. In the CBO forecasts, surpluses are used to retire the government's explicit debts.