CSE's Push for Personal Retirement Accounts 'Lockbox'
MAY 26, 1999
CSE's Push for Personal Retirement Accounts 'Lockbox'
DOCUMENT ATTRIBUTES
- Institutional AuthorsCitizens for a Sound Economy
- Subject Area/Tax Topics
- Index Termsbudget, federalFICA trust fundsMedicarelegislation, taxFICA benefits
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 1999-18755 (2 original pages)
- Tax Analysts Electronic Citation1999 TNT 102-72
ONLY TRUE SOCIAL SECURITY LOCKBOX: PERSONAL RETIREMENT ACCOUNTS
=============== FULL TEXT ===============
CITIZENS FOR A SOUND ECONOMY
May 26, 1999
[1] WASHINGTON -- Today, Paul Beckner, President of Citizens for a Sound Economy, outlined for Members of Congress why Personal Retirement Accounts provide Americans the best Social Security "lockbox."
[2] The text of the letter follows:
The key to looking up the Social Security surplus is personal
retirement accounts. As Congress attempts to protect the Social
Security surplus through construction of a legislative lockbox,
it is important to keep in mind that the most secure lockbox
Congress could create is a personal retirement account for each
and every worker, which they would own and control.
The lockbox plans now under consideration are supposed to
protect the system by insuring that Social Security's surpluses
continue to build up in the trust fund while simultaneously
reducing the government's debt burden in preparation for the
baby boomer's retirement. However, although simply allowing more
IOUs to build up within the trust fund can make the system look
healthier on paper, it does not create any real assets that can
be drawn down to cover the program's long-term shortfalls.
Likewise, buying down debt sounds good rhetorically, but it does
nothing to help us cover Social Security's long-term
liabilities. The 2014 insolvency date would not change even if
Congress were to dedicate every dollar of Social Security's
surplus to debt reduction for the next fifteen years (a total of
$2.7 trillion).
Without making any structural reforms to the system, we simply
face the prospect of running up $8 trillion in new debt over the
next twenty years to pay the system's bills, unless of course we
choose to raise taxes. Instead of using workers' excess FICA tax
payments to buy down debt, Washington has an obligation to allow
them to invest those extra taxes in personal retirement accounts
that will grow into real assets.
Congress is right to try to match President Clinton's rhetoric
with action to lock up the Social Security surplus. But the most
secure "lockbox" lawmakers could create is a personal retirement
account owned and controlled by each and every worker. They
should rebate every dollar of the Social Security surplus into
personal retirement accounts, then let President Clinton argue
why the government is more qualified to "safeguard" taxpayers'
money.
PERSONAL RETIREMENT ACCOUNTS
[Drawing omitted]
DOCUMENT ATTRIBUTES
- Institutional AuthorsCitizens for a Sound Economy
- Subject Area/Tax Topics
- Index Termsbudget, federalFICA trust fundsMedicarelegislation, taxFICA benefits
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 1999-18755 (2 original pages)
- Tax Analysts Electronic Citation1999 TNT 102-72
