Word: socialism
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Dates: during 1970-1979
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...Social Security's basic guarantees must not change, says Gore. So he proposes pouring more revenue into the program in order to fund the retirement of the baby boomers without having to raise payroll taxes or cut benefits. Since the Social Security system cannot keep big cash reserves of its own, Gore relies on a two-step process: He uses $3.5 trillion of the projected surpluses over the next 12 years to pay down the entire national debt; then he takes the resulting savings in interest payments (which by 2015 will amount to more than $220 billion a year...
...Gore also proposes what he calls "retirement savings plus": a plan for voluntary, tax-free savings accounts similar to 401(k)s that can be used to supplement Social Security. Workers who earn as much as $100,000 a year will receive federal matching funds (in the form of tax credits) of as much as $1,500 a year...
...Paying off the debt now enhances the Treasury's ability to borrow later, when Social Security benefit payments will exceed incoming payroll tax revenues. A smaller national debt also reduces overall demand for credit, pushing down interest rates. This in turn should stimulate economic growth and create jobs, producing more payroll tax revenue to keep Social Security healthy. Devoting the savings in interest payments to Social Security should extend the program's solvency from...
...raise payroll taxes, Gore banks on the surpluses created by the good economy to pay for the baby boomers' retirement. If the economy goes into recession, Gore will have a painful choice: go back on his word, or take money from the rest of the budget to pay for Social Security (which could mean raising income taxes, cutting spending in such programs as education and health care or running up annual deficits...
...check is in the mail The Gore plan only delays the impending bankruptcy of the program; it doesn't solve it. Even if Gore gets the country through the retirement of the baby boomers, the cost of Social Security will continue to rise (because people are living longer), forcing what may be more painful reforms the next time around...