Take Social Security Off-Budget
The era of budget surpluses dawns, and the pilfering has already begun. Congress has just passed a huge transportation bill that busts the ceilings established by the balanced budget agreement just last year. And President Clinton, for his part, already has signed a bill containing a half-billion dollars of "supplemental" spending to pay for our Bosnia deployment.</br></br>This not only broke Clinton's own pledge to save every penny of the surplus for Social Security. By blatantly abusing the loophole for "emergencies" (the Bosnia deployment is already three years old and open-ended), it mocked the deficit reduction rule enshrined in the budget agreements of 1990, 1993 and 1997 that all new spending must be offset by cuts elsewhere.</br></br>We are now enjoying a glorious and unique economic moment. We have the lowest peacetime unemployment since 1957. There is no inflation. Clinton has just announced a $39 billion budget surplus for 1998. The Congressional Budget Office estimates that it might run as high as $63 billion. How do we keep from frittering away the current bounty?</br></br>Government cannot save its extra money by squirreling it away in a safe-deposit box. But it can do the equivalent by paying down the national debt, now a hefty $4 trillion. But how do you make politicians put away a surplus?</br></br>A little history. In 1968, in order to pay for the war in Vietnam and pretty up the numbers of a surging budget deficit, President Johnson arbitrarily decided to include Social Security in the budget. Social Security was then, as now, taking in more money every year from workers than it pays out to old folks. It helped LBJ produce balanced books.