[Congressional Record (Bound Edition), Volume 151 (2005), Part 3]
[House]
[Page 4105]
[From the U.S. Government Publishing Office, www.gpo.gov]




                            SOCIAL SECURITY

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Texas (Mr. Burgess) is recognized for 5 minutes.
  Mr. BURGESS. Mr. Speaker, we hear a lot of talk about Social Security 
and what is the right word to use. Is it a crisis? Is it just a 
problem? Is there no problem with a system awash in cash that perhaps 
just needs some minor adjustments down the road?
  Well, Mr. Speaker, I do believe there is a crisis, or at least a 
serious problem that is looming. There is no question we are held 
captive by our demographics. In order for our Social Security System to 
work, we need large numbers of young people to pay into the system. We 
also need people on retirement to not live very long after they retire. 
But the reality is our birth rates in this country are down, and our 
retirees are living longer lives.
  Both situations are arguably good news, but they do portend a serious 
situation for our Social Security System. I would draw attention to 
this graphic. This was produced by the Congressional Research Service. 
It is not a partisan chart. But here is the year I was born, 1950, and 
we have a little over 16 workers working away to support every retiree. 
Fast forward, and here we are in 2005. We have three workers working to 
support every retiree. But as we move down the line, we go to two 
workers to support every retiree.
  Now, Mr. Speaker, make no mistake about it, I believe very strongly 
in the American economy. And I would bet on the American economy over 
and above any economy in the world. And I just bet we can make those 
two workers a lot more productive in those out years, in 2040 and 2050. 
But I do not know if we can make them productive enough for two workers 
to support one retiree. I think we have to look at some other things.
  A lot of people talk about the trust fund, and, gosh, there is just 
money in the trust fund, and we will spend that money on retirees when 
the time comes. Again, I will go to the Congressional Research Service, 
and this is a graph produced by them just a few weeks ago. It is on the 
Web site. Anybody can go access it that wants to. Well, this shows the 
money in the trust fund. And again, you will see that there is a great 
deal of money coming in, and it is projected to increase. But we reach 
a point, looks to be about 2028, when the money starts coming down, and 
it comes down very rapidly.

                              {time}  1715

  This includes paying back the money that is in the trust fund that 
was borrowed. This includes monetizing the Social Security debt which 
in and of itself can be pretty painful for the markets when that time 
comes.
  Mr. Speaker, there is a question of fairness here because 12 percent 
of the country's payroll pays into the Social Security system and does 
not really pay a fair rate of return. It pays by anyone's estimate 
1.14, 1.19 percent interest. What Albert Einstein, probably the finest 
mind of the last century, described as the miracle of compound 
interest, this miracle is being denied to American workers.
  The old axiom states we tax what you do not want, but surely we want 
jobs for tomorrow's American. Increasing the payroll tax is really not 
a solution that I can accept. So what are the solutions? What about 
cutting benefits as suggested by one of the other speakers. I did not 
come to Congress to cut benefits on Social Security. We could raise 
taxes, but I do not want to do that. Taxes on jobs are going to drive 
jobs overseas. We already create a punitive environment in this country 
for the creation of new jobs with our legal system, cost of health 
care, and our Social Security payroll tax. I do not think we need to 
contribute to that, and this Congress should make a pledge that it will 
not contribute to driving jobs overseas by increasing the payroll tax.
  I have already alluded to growth in the economy, and I believe in 
this country and I believe our economy will grow, but I do not know 
that we can count on that to cover all of the projected problems with 
the shortfall in the Social Security fund. So that leaves one lever 
left to pull, and that lever is getting a fair rate of return on the 
money that is invested in the Social Security system.
  The problem is if we leave that money for us in Congress, and I have 
only been here for 2 years, but I know what other Members know, if we 
leave that money in Congress, we will spend it. We will spend it so 
quickly, we will not even know we have spent it. And when it comes time 
to pay the interest, we will write an IOU to pay the other IOUs we have 
in that filing cabinet in West Virginia.
  The only way to protect the Social Security funds is to put them in 
accounts controlled by individuals where we cannot get at it. A 
question always comes how are we going to pay for this. We are already 
paying a great deal of money into the Social Security funds. We are 
paying a surplus into the Social Security system. So why not take that 
money in surplus, invest it and earn a fair rate of return on that 
investment.
  There is debt that is owed to the Social Security system. That debt 
will some day have to be monetized. That money continues to grow as we 
pay the interest on it and as we continue to borrow from those funds. 
Why do we not just borrow the money? The obligation is already there. 
Let us refinance it like any American family would refinance a mortgage 
if they were trying to work their way out of a difficult financial 
situation. Refinance the money, make it real debt with a real interest 
rate. I think the markets would take a great deal of comfort in that. 
Markets do not like uncertainty, and I do not think in 10 or 15 years' 
time they are going to like the uncertainty when we monetize the debt 
that we owe the Social Security system.
  So let us recognize it up front, call it what it is, it is a loan, we 
borrowed it, let us set a fair interest rate on it, and pledge to pay 
it back and set up a repayment schedule that we can all live with.
  So the current obligation is already present. Let us finance the 
transition with that debt and convert an unknown obligation into bonded 
indebtedness and give the markets some measure of comfort that we in 
Congress recognize the problem and know what we are doing to alleviate 
the problem.
  Mr. Speaker, it has been 70 years since Social Security was founded. 
Here in this House, let me just give a quote: ``It is proposed that the 
Federal Government assume one-half of the cost of the old age pension 
plan which ultimately ought to be supplanted by self-supporting annuity 
plans.'' These words were spoken in this House in a joint address 
before Congress by President Franklin Roosevelt in 1935. I think he had 
it right, and I think it is time for us to work on that.

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