1990: THE BUDGET BATTLE; Senate Kills Moynihan's Proposal To Reduce Social Security Taxes

[dkf]

By RICHARD L. BERKE, Special to The New York Times
Published: October 11, 1990

The Senate today killed a proposal for a Social Security tax cut that Senator Daniel Patrick Moynihan had made something of a personal cause for nearly a year.



The circumstances that led to Mr. Moynihan's tax-cutting campaign stem from 1983. That year, Congress overhauled the Social Security system, seeking to build a vast pool of money that would insure the existence of pension benefits for members of the baby-boom generation, large numbers of whom will begin retiring early in the next century.

As a result of the accelerated tax rates that the 1983 overhaul called for, the Social Security system now routinely shows an annual surplus. Next year, for example, workers and their employers will pay an estimated $341.7 billion into the system, which will provide benefits of some $270.8 billion, leaving a projected surplus of more than $70 billion.

But although these are surpluses of design, intended for a specific purpose, they are counted as general revenue when the Federal budget is written each year. This has led Mr. Moynihan and his supporters to complain that the surpluses are being used to mask the real size of budget deficits.

Snip

Several senators who supported Mr. Moynihan's bill echoed his complaint that Social Security surpluses were being improperly used to finance the Government's general operations.

''Because we are looting the Social Security Trust Fund and using it to fund the ongoing Government, we are asking the wage earners to pay more than they should,'' declared Senator Kent Conrad, Democrat of North Dakota. ''It's unfair to the working men and women of this country.''

http://www.nytimes.com/1990/10/11/us/budget-battle-senate-kills-moynihan-s-proposal-reduce-social-security-taxes.html?pagewanted=2&src=pm

[Wilms]

1. ^

[A Simple Game]

2. Moynihan was my senator and I had always admired him until then.

I thought he was wrong on this. Now I see he was right. He knew no good was going to come from the surplus for the common person, that they would never willingly repay the borrowed money.

I even knew at the time that Reagan had cut taxes for the rich and replaced the lost revenue with the SS surplus.