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Budget Office: Focus on economy to save Social Security
February 24, 1999 WASHINGTON (AllPolitics, February 24) -- The size of the economy is more important than the size of the Social Security trust fund to ensure that the nation will be able to afford retirement benefits for aging baby boomers, congressional analysts say. "It is the size of the economy that ultimately determines the nation's ability to support a growing elderly population with fewer workers," said Dan Crippen, director of the nonpartisan Congressional Budget Office. "What matters most is how much the working population creates -- how big the pie is relative to the piece devoted to retirees." 
Crippen on Tuesday briefed both the House and Senate on the CBO's preliminary analysis of the Social Security rescue plan President BIll Clinton proposed in his State of the Union speech last month. Republicans in Congress have criticized the plan, but have not yet come up with a unified counter proposal. On Tuesday, Senate Budget Committee Chairman Pete Domenici (R-New Mexico) said he will introduce legislation requiring that most of the federal budget surpluses expected in coming years go toward paying off the national debt, unless lawmakers agree to use them to help along reforms that would control Social Security's costs in the future. To spend the money on anything else would require agreement by more than a majority of Congress. GOP push for tax cutsDomenici said his approach would leave money for the broad tax cuts Republicans want, which is precluded by Clinton's plan. "He's gone to great lengths to see that there are no tax cuts available to the American people for quite some time. I don't think we need to do that," Domenici said. Clinton's plan would use about two-thirds of federal budget surpluses expected over the next 15 years to pay down the government's debts to private investors who hold Treasury bonds, which many economists believe would help the economy grow. Then, the president would put IOUs in Social Security's trust fund based on the expectation that more money would flow from a bigger economy and could be used to pay off those IOUs. CBO analysts agreed with Republican critics who say that wouldn't set aside cold, hard cash to pay retirement benefits in the future. "It's not a transfer (of money). It's a creation of new debt and I think it's confusing," said Barry Anderson, the CBO's deputy director. But strategies like Clinton's that try to improve the economy could make it easier to pay retirement benefits promised in the future, the CBO analysts said, and lawmakers should be considering such possibilities. "There may be governmental programs or tax reductions that increase economic growth more than debt reduction," Crippen said. Control costsAt the same time, lawmakers could look for ways to control Social Security's costs, such as raising the retirement age or making stock market investments that could bring a greater return for the program's money, the CBO analysts said. Social Security Commissioner Kenneth Apfel said Clinton is willing to discuss such options. The president wants to "achieve bipartisan action on the hard choices that must still be made," Apfel said. Republican leaders on Tuesday also signaled willingness to work with Democrats. "Where there are flaws in the White House proposal, let's fix them. Where there are good ideas, let's seize them," said House Ways and Means Committee Chairman Bill Archer (R-Texas). Pending the introduction of their own plan, Archer said House Republicans will push for a floor vote later this week on a nonbinding resolution asking lawmakers to commit to shoring up Social Security without raising taxes. The Associated Press contributed to this report. |
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MORE STORIES:Wednesday, February 24, 1999
• Budget Office: Focus on economy to save Social Security • Federal campaign enlists seniors as Medicare 'fraud busters' • Hillary Clinton meets with Schumer, Lowey on possible Senate bid • Begala leaving White House for teaching job • Buchanan to announce presidential candidacy in New Hampshire • Clinton kicks off campaign to insure children under Medicaid • Fed chief wary on economy • Census Bureau to revive sampling • Ken Bode ready to leave PBS over changes to `Washington Week' • GOP criticizes Clinton defense plan • Clinton legal fund raised $4.5M • Speaker: GOP may exceed spending limit • Ex-President Ford touts Gov. Bush • Hubbell trial will haunt first lady • Vice president's daughter expecting a baby • Gore courts Latino leaders • Magazine: Lewinsky recalls terror • Clinton settlement check in Jones case deposited with federal court | ||||||||||||||||||||||||||||
