Senate Budget Committee members of both parties spent Tuesday pressing Office of Management and Budget Director Jacob Lew for details about President Clinton's plan to reserve part of the projected total budget surplus to shore up Social Security, but found themselves more frustrated than enlightened.
Clinton has called for setting aside 62 percent -the amount derived from Social Security payroll taxes-of the OMB's projected budget surplus of $4.8 trillion over the next 15 years to devote exclusively to extending the life of the trust fund. Most Republican leaders, including House Speaker Dennis Hastert, R-Ill., and Senate Budget Committee Chairman Pete Domenici, R-N.M., agree with this principle.
Setting the tone for the hearing, Domenici opened by proclaiming himself confused by the administration's plan and troubled that it does not appear to address the problem that, starting in 2013, Social Security will take in less money than it is obligated to pay out in benefits as Baby Boomers begin retiring.
"This is debt that will still come due, whether you call it government debt or private debt," Domenici said.
A more critical Sen. Judd Gregg, R-N.H., compared how the Clinton budget proposes to transfer money from Treasury's general fund to the Social Security trust fund to "a house of mirrors." And Sen. Ernest (Fritz) Hollings, D-S.C., repeatedly asserted the administration is "double counting" when it proposes to buy Treasury bonds with the excess Social Security tax revenues as a means of buying down the government's publicly held debt and meeting the government's obligations to future retirees.
Lew said the President's economic plan "would get us a long way there" to extending the solvency of Social Security and represents the type of prudent fiscal policy that will best ensure that the economy continues to grow and generate surpluses in line with the OMB's relatively conservative projections.
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