[Congressional Record (Bound Edition), Volume 145 (1999), Part 5]
[House]
[Page 6270]
[From the U.S. Government Publishing Office, www.gpo.gov]




                    THE SOLVENCY OF SOCIAL SECURITY

  The SPEAKER pro tempore (Mr. Mica). Under the Speaker's announced 
policy of January 19, 1999, the gentleman from Michigan (Mr. Smith) is 
recognized during morning hour debates for 5 minutes.
  Mr. SMITH of Michigan. Mr. Speaker, I come before the Chamber this 
morning to talk about an important item for this country, and that is 
the solvency of Social Security.
  I have been in Congress 6 years. When I first came to Congress in the 
103rd Congress, and subsequently in the 104th Congress, 105th Congress, 
I have introduced legislation that would keep Social Security solvent.
  This year, I am chairman of a bipartisan Budget Committee Task Force 
on Social Security. The problem of solvency justifies a few minutes of 
review and comment.
  Most workers today look forward to some kind of Social Security when 
we retire based on the fact that most of us now pay 12.4 percent out of 
every dollar we earn as a Social Security tax. Most workers anticipate 
that there is going to be some return on that kind of contribution to 
the Social Security system.
  However, we were told back in 1993 by the Congressional Budget 
Office, and by the President's Office of Management and Budget, that 
Social Security would be going broke.
  Now, in the last several months, we have been hearing from both sides 
of the aisle, the Democrats and the Republicans, that paying down the 
public debt with some of the Social Security surplus would somehow save 
Social Security. Not so. Not so, Mr. Speaker.
  It is good and it is historic that for the first time in recent 
history we will not be using the Social Security surplus for other 
government spending programs. So when some have bragged about having a 
balanced budget in the past, they have been misleading. It has been 
somewhat of a hoodwinking of the American public, because we have 
depended all these years on the surplus coming in from Social Security 
to mask the deficit.
  The good news is that this year, for the first time in many, many 
years, we will not be spending that Social Security trust fund surplus. 
Now we have got to have the intestinal fortitude, we have got to have 
the willingness, to face the tough problem of saving Social Security 
and Medicare. That means a restructuring of the program.
  Generally, Mr. Speaker, the problem is based on demographics. There 
are more and more retirees in relation to the number of workers paying 
in those taxes. Let me just give you a quick example of why depending 
on current worker taxes to pay current retiree benefits is a problem.
  In 1950, there were 17 people working, paying in their Social 
Security taxes that was immediately sent out to beneficiaries. 17 to 1. 
This year there are three workers paying in their Social Security tax 
for every one retiree, and the estimate is that by 2030 there will be 
only two workers trying to come up with enough to support their 
families and one retiree. So there has to be some structural changes in 
the way the Social Security system works.
  It is a tough decision, and that is why politicians have not dealt 
with it. There are only two ways to save Social Security. That is, 
either reduce benefits or increase the amount of revenue coming in. One 
way to increase revenue is private investment. However, that by itself 
will not fix Social Security.
  Let us hope, Mr. Speaker, that we have the gumption, the fortitude, 
the willingness to step up to the plate to make the hard decisions in 
order to save Social Security. Let us hope that the American people are 
willing to learn about the complicated ways Social Security is financed 
and to encourage their representatives in Congress to move ahead. Let 
us be clear that even though using the Social Security surplus to pay 
down the public debt is better public policy than using the money to 
finance more government spending, it does not save Social Security.

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