[Congressional Record Volume 144, Number 49 (Tuesday, April 28, 1998)]
[House]
[Pages H2378-H2379]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         SAVING SOCIAL SECURITY

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Michigan (Mr. Smith) is recognized for 5 minutes.
  Mr. SMITH of Michigan. Mr. Speaker, there has been a lot of talk 
recently about what we are going to do to save Social Security. I would 
report to my colleagues this evening, Mr. Speaker, that today the 
Social Security trustees presented their new analysis of when Social 
Security is going broke; in other words, when there is going to be less 
money coming in from tax revenues than is required to pay current 
benefits.
  That projection indicated that we have maybe a year, maybe 2 years' 
additional time before less is coming in than is needed to pay 
benefits. I think today is a day that we should all remind ourselves of 
the real problem of Social Security.
  The estimate continues that the unfunded liability or the actuarial 
debt of Social Security is over $3 trillion. In other words, we would 
have to take $3 trillion today and put it in some kind of an investment 
fund to keep Social Security going for the next 75 years.
  The problem that we are running into, Mr. Speaker, is the 
demographics of Social Security. Social Security is a pay-as-you-go 
program where existing workers pay in their taxes, and immediately 
those taxes are sent out to existing beneficiaries. Because of that and 
because demographics have changed in the last several years, there are 
fewer and fewer workers paying in taxes to support an increasing number 
of retirees.
  Let me give my colleagues some examples of that changing 
demographics. In 1942 there were about 40 people working, paying in 
their Social Security tax for each retiree. By 1950 it got down to 17 
workers working, paying in their Social Security tax for each retiree. 
Guess what it is today? Today, there are three people working, paying 
in their Social Security tax for each retiree. And the estimate is that 
by 2027 we will be down to two workers.
  What has happened is there has been a decline in the birth rate after 
the so-called baby boomers. Then additionally, there has been an 
increase in the longevity or the length of time people are expected to 
live.
  When we started Social Security in 1935, the average life span was 62 
years old. So, therefore, since the retirement age was 65, that meant 
most people never lived long enough to collect anything from Social 
Security. Today the average life span at birth is 74 years old for a 
male and 76 years old for a female, but if one is I will use the word 
``fortunate'' enough to reach retirement age 65, on the average, he or 
she will live another 20 years.
  So what do we do about this pay-as-you-go system? How do we change 
it? The estimates are that there is going to be less money coming in as 
taxes than is needed for benefits as early as 2007 to 2013. Sometime in 
that time period, there is going to be less money coming in than is 
required to pay out benefits. The longer we delay in solving and coming 
up with a solution for Social Security, the more drastic that solution 
has to be.
  I have the only bill that has been introduced in the United States 
House of Representatives that has been scored to keep Social Security 
solvent for the next hundred years. That is House bill H.R. 3082. But I 
also put in a companion bill a couple months ago, that is H.R. 3560, 
that says--in addition to keeping Social Security solvent for the young 
people and allowing them to own a private retirement investment account 
that bears money that if they die before age of retirement goes into 
their estate--this proposal says, ``let us start using some of the 
surplus money that is coming into the Federal Government.''
  And we now expect the surplus this year, as we now define 
``surplus'', to be upwards of $40- to $50 billion. So I say, let us 
start using some of that money to set up private investment retirement 
savings accounts for people that pay a FICA tax, for people that are 
working.

[[Page H2379]]

  Let us not put off this problem simply but let us take advantage of 
today's current positive economy, with more jobs and higher pay in many 
cases, to create a Social Security program that preserves benefits for 
current retirees, and makes sure that future retirees have even more 
savings when they retire.
  Mr. Speaker, let us do put Social Security first.

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