How many campaign promises can be funded by doing away with the Bush tax cuts?
At an AARP candidate forum in Davenport, Iowa, on September 20, Democratic presidential candidate Hillary Clinton proposed averting a Social Security crisis could be done partly with that strategy.
“So the first thing is, let’s get back to doing what worked in the ‘90s to shore up Social Security,” Clinton said. “Let’s quit taking money from the Social Security Trust Fund to fund tax cuts for the wealthy and the war in Iraq. That’s the way to start having a solvent Social Security future.”
However, Clinton already has plans for any rollback of the Bush “tax cuts for the wealthy.” According to Clinton’s Web site, her $110-billion health care plan would be financed in part by rolling back President George W. Bush’s 2001 tax cuts for those in the top two tax brackets.
And of course, Clinton’s logic assumes that there is a Social Security Trust Fund with money in it, which is untrue.
“There is no cash in the Social Security trust fund, and there never has been any,” wrote Social Security expert David John of The Heritage Foundation. “The Social Security trust fund is merely an accounting device filled with IOUs that future taxpayers must repay.”
But Clinton acted as though Republicans had taken away money that had been in the trust fund.
“When my husband left office with a balanced budget and a surplus, the projection was that Social Security was solvent until 2055, giving us plenty of time to deal with the aging of the baby boomers and everything else,” Clinton said. “Now after seven years of President Bush and an irresponsible Republican Congress, the life of the Social Security trust fund has been cut to 2041.”
A September 27 article by Jed Graham in Investor’s Business Daily reported that back in 2001, the trustees’ report on Social Security’s financial status projected the fund would dry up in 2038.
According the IBD article, the projection of Social Security solvency until 2055 was based on the assumption government surpluses would continue beyond the Clinton presidency and a portion of the surpluses would be invested in the stock market.
“But those surpluses vanished by 2002,” Graham wrote. “Recession, war and spending increases ushered in a new era of deficits, and there's no reason to believe the next president will have large surpluses to work with.”