BW on Soc Sec IX: the Paradox of Benefit Cuts

I have a horse race to watch so this will be short and in the form of a intellectual challenge.

In any year that Social Security is in surplus, as it is now and is projected to be until 2017, cutting benefits actually increases total federal debt and so worsens the overall financial outlook going forward. The result is to a striking degree counterintuitive but it is in fact true, if you sit down and think about the implications of investing the entire Trust Fund in Special Treasuries. Which same fact makes revenue increases through such things as a cap increase transform into long term debt.

The arithmetic seems beyond the best efforts of Cosi and tends to baffle Obama supporters who think that a cap increase is progressive (it isn’t) and would somehow help Social Security (it doesn’t). Not everything in life is intuitive, for example it is simply absurd how much of modern mathematics and engineering depends on the use of the square root of negative one (‘i’).
( and lets not even get started on Schroedinger’s Cat. Social Security financing is not as baffling as Quantum Mechanics but it does has its quirks, and this is one of them.

Cutting Social Security spending near term creates long term Federal debt. Discuss.