THE WHITE HOUSE AT WORK
Thursday, February 25, 1999
PRESIDENT CLINTON AND VICE PRESIDENT GORE:
SAVING SOCIAL SECURITY AND STRENGTHENING MEDICARE FOR ALL GENERATIONS
The aging of America means that, more than ever, we must think about and plan for and save for the future...And we must do so in a way consistent with our national values--a way that renews our shared responsibility to one another, across generational lines. Because the decisions we make today about what to do with the budget surplus, and about how to save Social Security and Medicare, are every bit as important to younger Americans as they are to older Americans.
President Bill Clinton
February 25, 1999
Today, President Clinton travels to Tucson, Arizona, where he discusses his plan to save Social Security, strengthen Medicare, and ensure that we meet our obligations to all generations. The President also announces that the publicly held debt will fall to its lowest level since 1917.
Using The Budget Surplus To Help Save Social Security. President Clinton proposes to transfer 62 percent of the projected budget surpluses over the next 15 years--$2.8 trillion--to save the Social Security system. By devoting the bulk of the budget surpluses to paying down the debt, the President's plan cuts our interest payments and puts the government in a better position to meet its obligations to Social Security.
Saving Social Security For Future Generations. The Clinton-Gore Administration's plan to transfer over 60 percent of the budget surpluses to Social Security and invest a portion in the market will keep Social Security solvent until 2055, as the independent Social Security actuaries have certified. The President wants to work with both parties in Congress to make the tough but sensible choices that are necessary to save Social Security, and he is committed to working with Congress to save this system until at least 2075. As part of this effort, President Clinton believes that we must:
- Reduce poverty among single women. Elderly women, particularly widows, have a poverty rate nearly twice the overall poverty rate for older Americans;
- Eliminate the earnings test. The earnings test is confusing and out-dated. Consequently, it discourages older Americans from working and earning their own income.
Strengthening Medicare For The 21st Century. The President's framework also reserves 15 percent of the projected surpluses for Medicare, securing Medicare until 2020. The President believes that the new resources should be utilized to achieve broader, bipartisan reforms that modernize Medicare, make it more efficient, provide for a long overdue prescription drug benefit, and keep Medicare safe until 2020.
Extending Tax Relief To Americans, While Preparing For The Challenges Of The Future. After Social Security and Medicare are secure, President Clinton and Vice President Gore propose to:
- Provide $536 billion in tax credits to create new Universal Savings Accounts. The President's framework will reserve 12 percent of the projected budget surpluses to create new Universal Savings Accounts (USAs) so working Americans can build wealth to meet their retirement needs. To help Americans save, the federal government would provide Americans a flat tax credit to make contributions into their USA account. Additionally, the federal government would provide additional tax credits to match a portion of an individual's savings--with more help for lower-income workers.
- Prepare America for the challenges of the future. The President's framework will reserve 11 percent of the projected surpluses for military readiness and other pressing domestic priorities.
A Fiscally Responsible Proposal--Publicly Held Debt To Fall To Lowest Level In Over 80 Years. As a share of the economy, the publicly held debt increased from 26% in 1981 to 50% in 1993. Since President Clinton took office, the publicly held debt as a share of the GDP has dropped to 44 percent. Under the President's framework, the publicly held debt will be cut by more than two-thirds, and, as a share of the GDP, will fall from 44% today to 7.1% in 2014--its lowest level since 1917.