President Clinton plans to use tonight's State of the Union address to reveal the federal government is even closer to running a budget surplus than previously believed by announcing his economic advisers' latest forecast that the fiscal 1998 deficit will be "less than half" the approximately $23 billion previously predicted, according to an administration official.
Senior administration officials said they are hopeful the budget could even reach balance this year.
Clinton also will demand tonight that Congress send him legislation raising the minimum wage, although he will not specify a level.
In addition, Clinton plans to use the national stage to launch a sustained effort to reform Social Security. He will call on Congress to hold all future budget surpluses in reserve until a Social Security reform plan is in place, but he will not demand--as has been reported--that surpluses be devoted exclusively to shoring up the retirement system, according to administration and congressional sources. Instead, Clinton will declare that the federal government must "save Social Security first," implicitly leaving what sources termed "wiggle room" for Congress to allot surplus money not needed for the Social Security effort to other causes.
Clinton also will propose that a White House conference on Social Security be held in December, but will not call for a special, post-election session of Congress to address the question.
Bowing to the reality that 1998 is an election year and that Social Security cannot be fixed this year, Clinton will demand the process get started in earnest directly after the election.
He will say Americans should be "coming together as a nation to form a true consensus" on the issue. By next year's State of the Union speech, Clinton will declare, the administration and the congressional leadership should be cooperating intensely in a bipartisan fashion to craft a Social Security reform strategy.
The Social Security proposal will be ensconced within the major theme for tonight's speech. One knowledgeable Democratic source said Clinton will spend about 10-12 minutes on foreign policy, including renewing his request for fast track trade negotiating authority. However, Clinton will not unveil a specific proposal, instead calling generally for concluding trade agreements with areas such as Latin America and Africa, as well as the need for training displaced workers and consolidating federal job training programs.
The speech also will include several types of targeted tax cut proposals, but will not contain a tax reform proposal, White House Press Secretary Michael McCurry indicated.
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