I didn't know the difference between an IOU and a bond is that IOUs can't be sold. I'll need a reference to IOU law for that, because I always thought that they only existed as a talking point from the Heritage Foundation dating from somewhere around the beginning of the Bush administration.

edit: You know what functions of government don't hold any bonds? Almost all of them. Are the roads a pyramid scheme? Is all government a pyramid scheme? I still find it tough to believe that there's a group of people who say that:

1. Because the government can selectively default on the bonds held by Social Security if it votes to selectively default on the bonds held by Social Security.

2. Therefore, Social Security is an unsustainable pyramid scheme,

3. Therefore, the government should default on the bonds held by Social Security.

The government can also selectively default on the bonds held by me personally, or by China, or by anyone not named Todd. I can also collect their shares of the rent from all of my roommates, deposit it into my general fund at the bank, spend all the money on crack, then set the house on fire. The point of view of the "IOU" people is that my roommates should vote for me to do that, because once the money was in my bank account it transformed into whimsy and unicorns and at least the commitment to the crack binge and imminent homelessness gives them the certainty to plan for the future.

If the government is defaulting on any bonds, as an American, you have more to worry about than your retirement, namely roving bands of cannibals in the street and nuclear fallout, or that the Peter Peterson Foundation has finally taken back the White House.