Nothing to see here, move along...
http://www.washingtonpost.com/ac2/wp-dyn?pagename=article&node=&contentId=A6766-2001Sep10¬Found=truePresident, Republicans Try to Ease Fears About Economy
Benefits Safe if Social Security Surplus Is Tapped, Officials Say; GOP Readies Budget-Cutting Bills
By Dana Milbank
Washington Post Staff Writer
Tuesday, September 11, 2001; Page A07
Top Republican officials yesterday sought to calm fears that President Bush's economic policies have jeopardized the Social Security program, reassuring retirees that their benefits would be safe even if the government dipped into the program's surplus funds.
While Republicans in both chambers of Congress drafted budget-cutting measures designed to protect Social Security funds, Vice President Cheney turned an energy policy event into a speech defending Bush's budget, and Senate Minority Leader Trent Lott (R-Miss.) said the political ramifications of using the Social Security funds were exaggerated.
Yesterday's efforts underscored the anxiety Republicans have felt since White House Budget Director Mitchell E. Daniels Jr. warned on Friday that the current fiscal year's budget could tap into Social Security funds -- something Bush and most lawmakers promised not to do. While Bush and his aides continue to assert that their budget will not need the funds, Daniels' unexpected warning sent lawmakers scrambling to consider bookkeeping changes and spending cuts that would keep the surplus retirement funds intact.
The Republican National Committee sent out a press release yesterday noting that tapping Social Security surplus funds would not harm beneficiaries. The statement referred to quotes from Marty Corry, an official with the AARP, saying that tapping the surplus "doesn't affect the trust funds one way or the other."
The RNC said it was not building a case for Bush and Congress to dip into the Social Security funds for the year ending Sept. 30, but was trying to correct any misunderstanding. "There's this sense out there that if the trust fund were to be used, benefits would be in danger," RNC spokesman Trent Duffy said. "It's just not right."
snip
Republicans on the House Budget Committee tentatively scheduled a hearing for this morning to draft legislation aides said would ensure that surplus Social Security payroll taxes would be used for debt reduction in the fiscal year that ends in three weeks. The plan would impose across-the-board spending cuts in most discretionary programs, including defense, in the 2002 fiscal year, in an effort to pay back any payroll tax revenue that was used for spending in 2001.
snip
Lawmakers also discussed ways to give a short-term boost to the economy. Lott expressed interest in coupling a temporary cut in the capital gains tax -- which many Republicans favor -- with a reduction in the Social Security payroll tax, which would benefit lower-income workers. "That would be something that would put money quickly into employees' pockets," he said.
The White House has yet to support any of the plans.
"The president is confident the tax plan that went into effect earlier this year is the right thing to do for the economy," spokeswoman Claire Buchan said. "He is open-minded about talking with people who have ideas about how we can protect Social Security and encourage growth."
R. Glenn Hubbard, chairman of the president's Council of Economic Advisers, told a group of economists in Manhattan that he doubted additional tax cuts would be useful. "The additional stimulus already coming is likely to be enough," he said.
Grover Norquist, an anti-tax leader close to the White House, predicted Bush ultimately will back both an automatic spending cut and a capital gains tax cut. But he predicted Bush would not endorse a payroll tax cut because it might look like a Social Security cut. "That's a bridge too far," he said.
A group of 16 supply-side economists who favor a capital gains tax cut posted a letter to Bush on the National Review Web site yesterday. It warned that the administration's "hands-off" approach "could mean disaster not just for the Republican Party in the next two elections, but also for the U.S. economy right now."
Printer-friendly format
Email this thread to a friend
Bookmark this thread
(1000+ posts)
Send PM |
Profile |
Ignore
