House Backs 'Lockbox' for Retiree Fund
Washington Post Staff Writer
Thursday, May 27, 1999; Page A1
House Republicans yesterday pushed through legislation intended to keep the government from frittering away money intended for the nation's retirees, seizing what they hope will prove the upper hand in the partisan wars over Social Security reform.
Without the customary prelude of hearings or committee votes, the House overwhelmingly approved a measure that promises to protect the $1.8 trillion in surpluses expected from Social Security taxes over the next decade. The vote was 416 to 12.
Even though both parties on Capitol Hill and President Clinton have pledged to make reform of the program a top priority for the year, the bill could well be the only Social Security legislation that is enacted by either chamber.
The measure calls for an obscure procedural device, known as a "lockbox" in budgetary parlance, that the GOP has found enjoys wide popularity among voters. The version of a lockbox adopted by the House would forbid Congress to spend Social Security surpluses except in an emergency and only after a special vote.
Such devices are regarded as largely ineffective by most fiscal experts. Still, on an issue that has been dominated for years by their opponents, the Republicans were able to draw grudging support yesterday from most Democrats. Other Democrats simply sputtered.
"Phony as hell" is the way Rep. David R. Obey (Wis.), the ranking Democrat on the House Appropriations Committee, described the notion of lockboxes. "They all have escape hatches in some way. They are all meant to score political points, not to accomplish anything." Obey voted for the provision.
Indeed, even as they passed the legislation, House leaders were forced yesterday to put aside a spending bill for agriculture after conservatives complained that it would lead to dipping into Social Security's surpluses. [Details, Page A10.]
The self-congratulation of Republicans yesterday -- and the irritation of Democrats -- highlights how the parties have resorted to angling for symbolic advantage on the issue of Social Security, as the prospects for more substantial reform of the nation's largest domestic program appear to be fading this year.
"This is the battle to be holier than thou," said Brookings Institution economist Robert D. Reischauer, a former director of the Congressional Budget Office. The lockbox vote "is a way of saying to the White House, 'We're doing you one better.' "
The Senate is feuding over a different version of a Social Security lockbox that is generally considered far more stringent -- so stringent, in fact, that it has sparked opposition even among some Republicans who fear that the spending limits it would impose might trigger a federal fiscal crisis.
Gene Sperling, the White House's chief economic adviser, reacted to the House vote last night by saying, "We would strongly prefer a lockbox that has more teeth in it and is committed to actually extending the solvency of Social Security, which both the House and Senate plans fail to do."
Though their approaches differ in degree, GOP leaders in both chambers are searching for a way to appear more fervent than the Democrats in safeguarding a program on which 44 million Americans rely for monthly benefit checks -- and that faces financial problems that are huge but not immediate. Social Security costs will balloon once the 77 million-strong baby boom generation starts retiring in a dozen years, and actuaries project the program's trust fund will be unable to cover all its expenses by 2034.
Recognizing that such an eventuality makes voters deeply anxious, the president stepped out front more than a year ago, pledging to "save Social Security first" by refraining from using government surpluses for other purposes until it was clear how much would be needed to shore up the retirement program. Last winter, he proposed devoting to the program 62 percent of those surpluses over the next 15 years, investing part of the Social Security trust fund in the stock market for the first time, and creating a small, separate system to help Americans save money on their own.
Republicans, for their part, prefer a greater reliance on individual investments. But the party's main proposal, advanced by the chairman of the House Ways and Means Committee, has attracted only tepid support from the rest of the GOP leadership. And most Americans are wary of converting the program into a system of private investments, public opinion polls suggest.
In such a climate, the lockbox allows the GOP to say it is safeguarding the program without wrestling with the thorny politics of restructuring Social Security itself. The idea gained momentum after a variety of polls commissioned by the party this spring showed it was favored by more than 80 percent of the public.
Specifically, the measure approved yesterday says that Congress could not dip into the Social Security surpluses unless both the House and the Senate adopted a special "point of order." The legislation prohibits any mention of those surpluses in federal budget documents. It would permit that money to be used for reform of Social Security or Medicare, and it would not interfere with GOP desires for a broad tax cut using other surpluses -- an idea that Democrats resist.
Some economic experts and many Democrats noted that Congress already has shown a lack of discipline lately when it comes to Social Security surpluses. Even though a 1997 balanced-budget deal constrains spending on defense and many domestic programs, Congress dipped into the surplus twice to finance more than $30 billion in "emergencies" -- last fall when it passed a huge omnibus spending bill and last week when it adopted a package to pay for the war in Kosovo.
"There is a level of hypocrisy on both sides of the aisle that is regrettable," said Rep. David Minge (D-Minn.).
But the Republicans yesterday sounded unfazed, pointing out that their lockbox would protect 100 percent of the Social Security surpluses, while the administration seeks to set aside less than two-thirds. "Washington for the last 30 years has used the Social Security trust fund as a blank check," said Rep. Gerald C. Weller (R-Ill.). "This lockbox will prevent the Clinton-Gore raid on Social Security."
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