[Congressional Record Volume 144, Number 54 (Tuesday, May 5, 1998)]
[House]
[Page H2780]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




         SOCIAL SECURITY: WHERE IS IT GOING, WHAT SHALL WE DO?

  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, I would like to do a bipartisan 
presentation, I think; and that is about Social Security, where are we 
going, what shall we do.
  I suspect a lot of people are going to be tired of hearing about 
Social Security. But I think it is so important that every American, 
either retired or somebody that is going to be retired some day, look 
at the problem of Social Security, what is happening, and at this 
summer and fall election, talk to their candidates that are running for 
Congress about what they are doing for preserving Social Security.
  I have this chart here that represents the bleak future of Social 
Security. As my colleagues see, on the top left of this chart that goes 
from up until about 2013 is the new projection of where there is going 
to be more tax revenue coming in from the working taxpayers of this 
country than is needed to pay benefits.
  Now, what happens in Social Security since we started in 1935? The 
existing workers pay in their taxes and immediately it goes out to pay 
benefits for existing retirees. This chart shows that we are going to 
have more tax revenue coming in than is required to pay out benefits 
for the next 12 to 14 years. Dorcas Hardy, by the way, thinks we are 
going to actually run out of money as early as 2005 or 2006.
  Now, in terms of what the excess money is, and that money is 
approximately $70 billion this year, $80 billion this year, $100 
billion the year after next, is being borrowed from Social Security to 
balance the budget.
  Now, when the trustees came out with their report last week, they 
said, well, really Social Security is not going to go broke until the 
year 2032. But what does that mean? If there is less money coming in as 
early as 2005, maybe 2014, maybe 2013, maybe earlier, how is government 
going to come up with the funds that are necessary to fill our 
obligation to meet Social Security benefits?
  Now, looking at this chart, if we are looking at the year 2018, in 
terms of today's dollars, there is going to be $100 billion that the 
general fund is going to have to come up with to pay the existing 
benefits, to pay back what it is has been borrowing from the Social 
Security Trust Fund.

  In terms of the 2018 dollars, it is going to be approximately $600 
billion, $600 billion that is either going to have to be borrowed, have 
other expenditures of the Federal Government reduced to come up with 
that money, or increase taxes.
  Let me say a word about tax increases that have been used to solve 
the Social Security dilemmas in the past. Listen to this one: Since 
1971, Social Security taxes have been increased 36 times in the rate or 
the base. More often than once a year we have increased the taxes on 
American workers in order to solve the shortage problems. Whenever 
there is less money coming in in Social Security taxes than is required 
for benefit payments, we have increased taxes.
  Over the years, since 1935 when we started the program, any time 
there are more revenues, what the tendency has been for politicians is 
to increase benefits. And of course, the largest change to the Social 
Security program was an amendment to the Social Security Act in 1965 
that started our Medicare program, another serious problem that we need 
to face up to.
  But, look, my message today is, let us not put off our efforts to 
work towards a solution. I have got a couple of bills introduced, in 
fact, the only bill that has been introduced in the House that has 
actually been scored by the Social Security Administration to keep 
Social Security solvent for the next 100 years.
  I have got another bill that says, look, if there are any surpluses, 
let us start using those surpluses coming into the Federal Government. 
And ``surpluses'' is defined, if my colleagues will excuse the 
technical expression, under a unified budget. That means where we are 
including everything we borrow from Social Security, we consider 
revenue; and therefore, that is the way we have come up with a 
definition that there is going to be a surplus this year.
  But let us start getting that surplus out of town, using it to set up 
private retirement investment accounts for everybody that is paying a 
FICA tax so that they can decide what they want, how they want to 
invest their money, within limitations. It is going to be required, it 
can only be used for their retirement. But let us not pretend that the 
problem is not serious. Let us get at it. Let us take Social Security 
seriously, and let us look at the solutions; and hopefully, next year 
we will come up with a legislative solution that will be passed into 
law.

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