House Speaker Newt Gingrich says a federal budget surplus could be used to ensure senior citizens continue to get Social Security benefits while younger people are shifted into a new "personal" retirement savings system.
"That is a win-win strategy," Gingrich said in a speech Thursday to national representatives of the American Association of Retired Persons.President Clinton asked Congress in his State of the Union address last week to set aside any federal budget surplus to help make sure Social Security can pay its bills through baby boomer retirements starting around 2010. By current projections, the nation's pension program is fully funded only through 2029.
Most Republican lawmakers have said they would prefer to use any extra money for tax cuts and to pay down the national debt.
But Gingrich said that putting the surplus into a "reserve fund for Social Security" would not rule out tax cuts if Clinton gives up some of the $113 billion in new spending he has proposed for child care, hiring more teachers and other programs.
If the president drops some spending from his fiscal 1999 budget plan, "we'll save the surpluses for Social Security and still have money for a tax cut," Gingrich said.
Anticipation of a $200 billion surplus over the next five years "allows us, I think, to begin to apply those surpluses to Social Security in a way which guarantees that nobody currently retired and no one within any foreseeable distance from retirement needs to worry about the system," Gingrich told members of the AARP's National Legislative Council, in town this week for a planning session.
"However, what it also allows us to do, I believe, is to ask the question what is the best retirement for our children and our grandchildren," he said, suggesting the answer may be mandatory private savings in personal retirement accounts.
Gingrich told the AARP council that he wants to participate in a series of public forums on Social Security that Clinton has asked the 32-million-member group to help with this year. But he said he will also ask Congress to create a separate commission on retirement security, made up of senior citizens, baby boomers and younger people.
The House's chief tax writer, Rep. Bill Archer, R-Texas, said he is still wary about mixing money from a general revenue surplus into the Social Security system, which is separately financed now by payroll taxes.
"We risk turning Social Security into a welfare program," Archer said at the AARP gathering. "The best thing I can think of to do is pay down the national debt."