[Congressional Record Volume 150, Number 43 (Wednesday, March 31, 2004)]
[House]
[Page H1763]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                            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. Madam Speaker, this is a good budget we passed 
out of this House and sent to conference. I am hoping that the kind of 
frugal budget that we sent to conference is going to come back to this 
House for a final budget of the House and the Senate.
  One thing that the budget did not deal with is unfunded liabilities. 
Unfunded liabilities are the promises that politicians make when they 
do not know where the money is coming from in later years. Last week, 
the actuaries of the Social Security Administration and the Medicare 
trust fund came up with their estimates of unfunded liabilities, and 
that is what this chart shows. It should scare the heck out of us.
  The Social Security and Medicare trustees have calculated that these 
programs have $73.5 trillion in unfunded liabilities. Now, if you 
divide the population of the United States, which is roughly 290 
million, into that $73.5 trillion, you end up with over a quarter of a 
million dollars for every man, woman and child that somehow is going to 
be responsible for paying for these benefits over and above what we 
have promised because the money coming in from the FICA tax, and that 
FICA tax supports Social Security and Medicare, over and above the 
money coming in in revenues from that tax, we are still short $73.5 
trillion.

                              {time}  1945

  Medicare part A is short $21.8 trillion; Medicare part B, $23.2 
trillion; Medicare part D, the drug program that we passed 4 months 
ago, $16.6 trillion.
  It is interesting on the prescription drug bill that Tom Savings, one 
of the actuaries, estimated at the time it was passed that the unfunded 
liability would be $7 trillion. His estimate now is $16.6 trillion.
  The danger, of course, is that what we are doing in effect is acting 
like our problems are so important today that it justifies taking the 
money of our kids and our grandkids that they have not even earned yet. 
The unfunded liabilities, in addition to the debt that we are 
accumulating, now over $7 trillion, is a huge liability to leave to our 
kids.
  I am a farmer from Michigan. What we have traditionally tried to do 
is pay off the farm so that our kids had a little better chance than we 
did. Instead, we are now faced with a situation, and here is my 
political take on it. Right now roughly 50 percent of the working 
population pays less than 1 percent of the total income tax in this 
country. What we have done is become more and more progressive with the 
easy flow of language and justification to tax the rich, but here is 50 
percent of the population that has little stake but to ask candidates 
that are running for Congress for more government services rather than 
less, and politically it has seemed to be to the advantage of 
politicians to make more and more promises. This represents how many 
promises we have made over and above our ability to pay for it.
  I did this chart, this was also with Tom Savings' help, just to show 
that in 16 years it is going to take 28 percent of our general fund 
budget to pay for the makeup difference in Medicare and Social 
Security. By 2030, it is going to take almost 53 percent of the total 
budget.
  So what do we do? How do we deal with this? Here is what this 
Congress, the House and the Senate and the White House has done in the 
past. This is when we run short of funds in Social Security.
  It started out with 2 percent in 1940, 2 percent of the first $3,000. 
It ran short of money, so in 1960 we raised it to 6 percent of the 
first $4,800. In 1980, we ran short again, so we raised it to 10.16 
percent of the first $26,000; and then in 2000, 12.4 percent of the 
first $76,000. In 2004, now, today, 12.4 percent of the first $89,000. 
So what we have done is either reduced benefits, increased taxes or a 
combination of both. That is what we did in 1983.
  I just call on my colleagues and I call on the American people, Madam 
Speaker, to ask their Members of Congress what bill have you written, 
what bill have you signed on to to make sure that we keep Social 
Security and Medicare solvent and not leave the total bill up to our 
kids?

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