Yesterday, President Obama threatened that if the debt limit is not raised by the August 2 deadline, he can’t guarantee that Social Security checks will go out.

However, for years Democrats have argued that Social Security is on strong fiscal footing, and reform is unnecessary. The argument is that over the years the government has collected more in Social Security taxes than it has paid out in benefits and that these “assets” have built up in a “trust fund” and will be enough to sustain Social Security for decades, even if it runs deficits for much of that time. For example in January 9 of this year Harry Reid argued that Social Security is “fully funded for the next 40 years.”

This begs the question, if Social Security is fully funded and not in crisis, why is it necessary for the government to go deeper into debt after August 2 in order for recipients to get their checks?

The reality is that the money in the trust fund was replaced with Treasury Bonds and spent almost immediately on other programs. The government must tax or borrow more to make good on the promises. A trust fund filled with IOUs for money the government owes itself is the same as having no trust fund at all.

Obama’s threat proves that.