Budget Surplus May Be Even Bigger
By The Associated Press -- June 28, 1999
WASHINGTON (AP) -- President Clinton
today proposed buttressing Social Security and
Medicare, using new White House projections
that budget surpluses will be more than $1
trillion bigger over the next 15 years than were
envisioned earlier.
''Now we have a chance to do even more to
use the fruits of our prosperity today to
strengthen our prospects for tomorrow --
indeed for tomorrows well into the 21st
century,'' the president said.
His plan included no dramatic increases in the
targeted tax cuts he proposed earlier this year.
But the president did not rule out considering
deeper tax reductions in discussions with
congressional Republicans later this year.
''Within the framework of achieving these
objectives, obviously I'll be working with the
Congress to achieve them,'' Clinton said before
departing for political fund-raisers in New
York and Connecticut.
Clinton's proposal was expected to add new
fuel to his budget fight with Republicans on
Capitol Hill, who want to use surpluses for far
bigger tax cuts than he has offered. Initial GOP
reaction was upbeat.
''If he means what he says, he's reversing
Democratic plans to spend the Social Security
trust fund on more Washington programs and
following the congressional Republicans' lead
in locking away Americans' retirement
security,'' said John Czwartacki, spokesman for
Senate Majority Leader Trent Lott, R-Miss.
The new administration numbers were released
days before the Congressional Budget Office
plans to unveil its own projections. Those
CBO numbers are expected to show somewhat
higher surpluses than the administration.
Clinton proposed setting aside $794 billion
over the next 15 years to strengthen Medicare,
including providing new prescription drug
benefits for the elderly. That is $108 billion
more than he proposed in February, when he
released his fiscal 2000 budget.
''By taking additional measures to increase
competition, combat fraud and reduce costs,
we can provide a new prescription drug benefit
and still pay down our national debt,'' Clinton
said.
The president plans to offer on Tuesday the
details about how he would change Medicare.
Clinton proposed setting aside an additional
$543 billion for Social Security over the next
15 years, which he said would assure the
program's solvency until 2053.
To strengthen the massive pension program for
the elderly and disabled, Clinton said he would
use all Social Security payroll taxes for
reducing the national debt, making them
off-limits for other spending.
''Social Security taxes should be saved for
Social Security. Period,'' Clinton said.
After a decade, he would also credit the
interest savings from the debt reduction to
Social Security, which a senior administration
official said would further lengthen Social
Security's solvency.
Standing beside an oversized graph showing a
plunging national debt, Clinton declared: ''We
have now cut up Washington's credit card.''
''By 2015, this country can be entirely out of
debt ... if we do not squander the surplus by
choosing short-term gain over long-term
national goals,'' he said.
Clinton's reference was apparently to debt held
by the public, which currently represents more
than half of the $5.7 trillion total debt. The rest
is debt the government owes itself, such as
money it has already spent from Social
Security trust funds that must be repaid.
For fiscal 2000, which begins Oct. 1, Clinton
will project a $5 billion surplus on the
non-Social Security side of the budget, the first
such surplus in four decades. Over the next 15
years, surpluses will be $1.08 trillion bigger
than he projected in February, including $715
billion more from the non-Social Security side
of the budget.
That is significant because it is the non-Social
Security side of the budget that Republicans
want to use for tax cuts -- and that Clinton has
so far resisted using for such purposes.
Clinton will also propose increasing spending
for defense and domestic programs such as
veterans affairs, environmental protection,
medical research and agriculture. The increase
will be $41 billion over 15 years above his
February proposal.
In addition, the president proposed a ''children
and education trust fund,'' designed to ensure
healthy financing for programs such as Head
Start and school construction.
For the current fiscal year, the administration
now expects an overall budget surplus of $99
billion, the biggest ever and $20 billion more
than it projected in February.
The improvements are due to a stronger
performance by the economy than the
administration projected in February, when
Clinton released his budget. |
