SOCIAL SECURITY TRUSTEES REPORT SHOWS PROGRESS
BUT IDENTIFIES REMAINING CHALLENGES
Today, the Social Security Trustees reported that the projected life of
the Social Security trust funds have been extended until 2037 -- 3 years
longer than projected in last year's report. These improvements are due
in large part to President Clinton's strategy of fiscal discipline which
has helped create the conditions for the longest economic expansion in
U.S. history. Even with this good news, the report underscores the
major challenges facing the Social Security program. The President has
a proposed a specific plan to make a down payment on addressing these
challenges, extending the life of Social Security to at least 2054,
while paying down the debt held by the public by 2013.
The Annual Report of the Social Security Trustees Shows an Improvement
in the Long-run Financial Status of the Program over the Past Year.
Under the new projections, the Social Security trust funds will not be
exhausted until 2037, 3 years later than projected in last year's
report. Another key measure of the long-run health of Social Security
-- the actuarial deficit as a share of taxable payroll -- improved from
2.07 percent to 1.89 percent. These improvements are due in part to the
strength of our economy to which President Clinton's strategy of fiscal
discipline has contributed.
The Trustees Report Underscores the Long-run Challenges Facing Social
Security. As the baby boomers retire and life expectancies continue to
rise, the new report projects that the number of people age 65 or older
will double -- from 35 million in 1999 to 71 million in 2035. In 1960,
there were 5.1 covered workers for every Social Security beneficiary.
In 1999 there were only 3.4 workers for every beneficiary. And by 2035,
there are projected to be only 2.1 workers for every beneficiary. This
is further evidence that we must act now to make certain that Social
Security is as strong for our children as it has been for our parents.
The President Has a Fiscally Responsible Plan To Use the Benefits of
Debt Reduction to Extend the Life of Social Security Until at Least
2054. The President would ensure that the benefits of the debt
reduction that are due to Social Security are used to extend the life of
Social Security through his two-part proposal:
The President proposes to lock away all of the Social Security
surplus, a step that would pay down debt and prepare the government, and
the Nation, for the retirement of the baby boom generation.
After a decade of debt reduction because of the Social Security
surpluses, the President's plan bases transfers on the interest savings
resulting from this debt reduction to the Social Security trust fund.
These fiscally prudent steps will pay down the government debt by 2013
and extend the solvency of the Social Security trust fund until at least
In Contrast, the Republican Budget Would Not Add a Single Day to the
Life of Social Security. The Republican so-called "Safe Deposit Box"
for Social Security surpluses would not extend the life of Social
Security by even one single day. In fact, the unrealistic Republican
budget plan threatens to break their "Safe Deposit Box" for Social