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As Election Nears, Gore Demagogues on Social Security
October 30, 2000
With the 2000 presidential election just over a week away, the fight over Social
Security has kicked into high gear. Vice President Gore and the Democrat party
are running a series of television ads and automated telephone calls intimating
that Texas Gov. George W. Bush’s plan to let workers invest a portion of their
payroll taxes in the market would mean benefit cuts for current retirees. The
ad says: “Bush is promising young workers $1 trillion from Social Security for
them to invest. But the same money is needed to pay current benefits. If Bush
gives it away, it could cut benefits for seniors.” [Click here
and here
to view the ads in RealVideo.]
But as Cato’s Michael Tanner explains, claims that Bush’s personal accounts
plan takes money needed to pay current benefits are simply false: “Under Bush’s
proposal, workers would be able to divert approximately one-sixth of their Social
Security taxes to individually owned, privately invested accounts. That would
reduce Social Security revenue by $1 trillion over the next 10 years. Social
Security, however, is currently running a surplus. Over the next 10 years workers
will pay into the system approximately $1 trillion more than is needed to pay
benefits to current retirees. That surplus is not used to pay current benefits.
Nor is it saved to pay future benefits. Rather, it is used to purchase bonds
for the Social Security Trust Fund. The revenue raised from those bonds becomes
general government revenue and is used to finance the general operating expenses
of the federal government.
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