The Social Security system is currently generating tax revenues that exceed the benefits paid to recipients. This surplus is
A) being invested in foreign bonds, which will provide Americans with a source of income when the baby boom generation retires.
B) separated from other government revenue so politicians will not spend the money during the current period.
C) being channeled into earmarked private savings accounts.
D) invested in government bonds, the redemption of which will require an increase in taxes (or additional Treasury borrowing).

Question

Quizplus · Accepted Answer

The surplus from Social Security is invested in government bonds, which means that when these bonds are redeemed, it may necessitate an increase in taxes or additional borrowing by the Treasury to cover the costs.

The Social Security System Is Currently Generating Tax Revenues That