I've addressed this before by trying to explain how Social Security Benefits are financed, but this time I'll start with how the government itself is financed.
In virtually any year the United States Government functions by way of deficit spending. This means that the amount that the government plans to spend in any given year exceeds what is being taken in by way of taxes. The difference is made up by borrowing. This doesn't mean that the Treasury goes to the bank and applies for a loan - on the contrary the United States Treasury issues bonds and other securities which are purchased by individuals, financial institutions and even foreign nationals and governments. These instruments have a term at the end of which the holder redeems it for the purchase price plus interest. Once a budget is approved by Congress and signed by the president, the additional debt is approved. Politicians often argue about how this or that program is going to be paid for, and negotiate over cuts in other areas to counter increases, but for all the arguing they still end up having to borrow in order to pay the bills. If Congress or the president wants to start another war, or forgive student loans, or any other expensive proposition they don't really have to borrow or steal from anywhere, especially not the Social Security Trust Fund, they simply authorize a larger deficit for that year, triggering more debt.
Conservatives blame Democrats for this mythical theft from Social Security, Democrats typically blame George W. Bush for doing it to fund the wars in Iraq and Afghanistan. But not only did they not need to take any money from the Social Security Trust Fund, but it's not as if the Trust Fund is a vault full of cash or even a bank account. The money that individuals are taxed to fund Social Security are not sequestered away for each worker's future use. It's not "our" money any more. That money that comes out of our paychecks goes to pay for current retirees. When we retire our benefits will be paid for by money taken out of future workers' paychecks. In addition, any surpluses are required by law to be invested in nonmarketable government securities - so there's not even any cash in the Trust Fund for anyone to steal.
To be fair, in some sense, Congress and/or various presidents have borrowed money from the Trust Fund, but only because that's how it's legally structured. Going back to the concept of deficit spending - if the government has to borrow, i.e. issue Treasury bonds, to cover the deficit each year, wouldn't it make sense for the amount that has to be borrowed from outside sources be reduced by the amount of Social Security surplus that is required to be invested? And the Social Security Trust Fund receives interest from the general fund when those bonds are redeemed by the Trust Fund. The 2.9 trillion dollar Trust Fund balance is the result of decades of surpluses and consists entirely of Treasury bonds.
Several years ago the amount of benefits being paid out each year exceeded the amount taken in by payroll taxes, so the Trust Fund stopped running surpluses. The Trust Fund balance will be reduced each year by that deficit. The potential insolvency next decade isn't due to the piggy bank getting raided, but because there aren't any more surpluses. Even then, revenue from payroll taxes will be able to cover around 70% of projected benefits each year unless Congress makes other arrangements.
There aren't any missing funds pilfered by previous presidents or congresses, it's simply a result of the ratio of retirees to workers increasing over the years.
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