Gore pushes Social Security benefits boost to aid women

$100 billion proposal defines policy dispute with GOP rival Bush

April 05, 2000|By Jonathan Weisman | Jonathan Weisman,SUN NATIONAL STAFF

WASHINGTON -- Vice President Al Gore proposed yesterday the most substantial increase in Social Security benefits in 25 years, suggesting that widows and working mothers be granted more money to combat high poverty levels among elderly single women.

The $100 billion proposal, outlined at a Philadelphia community center, drew praise from senior citizens and women's groups. But it drew fire from liberal and conservative experts on Social Security, who questioned the wisdom of increasing benefits when the system's long-term solvency is in doubt.

The Gore campaign said the proposal would cost less than 5 percent of Social Security's projected $2.2 trillion surplus over the next decade. That would come to more than $100 billion.

The plan also highlighted a major policy disagreement between Gore and his expected Republican presidential opponent, Gov. George W. Bush of Texas. Bush favors a fundamental privatization of Social Security that would let individuals invest some of their Social Security taxes in the stock market.

Under the Gore initiative, parents who took time off from work to care for their children would be credited with five years of work. (Social Security benefits are calculated according to total wages earned in a worker's lifetime.)

The change would give up to 8 million Americans an average of $600 in additional benefits annually. Benefits for lower-income women could rise as much as $2,100 a year.

Gore also proposed increasing benefits to widows and widowers by ensuring that Social Security payments would always total 75 percent of a couple's combined benefits.

Currently, if a couple earned roughly the same incomes during their careers, the death of one could cut the other's Social Security benefits in half and make it difficult for the surviving spouse to cover living expenses.

Nineteen percent of elderly single women live in poverty, said Jeffrey R. Liebman, an economist at Harvard University's Kennedy School of Government. The change Gore has proposed, Liebman estimates, would reduce poverty among elderly women by about 10 percent.

Together, the proposals would result in the most significant increase in benefits since 1975, when Congress voted to index Social Security to account for inflation, Liebman said.

"If you entrust me with the presidency, I make you this promise," Gore told senior citizens at the community center. "I will make the modest but crucial adjustments in our Social Security system that will make it fairer for American women to honor their work."

The suggestions generally drew praise from groups representing the interests of the elderly and of women. Evelyn Morton, a legislative analyst for AARP, called the plan "a painful recognition of the benefit squeeze women can face due to circumstances over which they have limited control."

Cost questioned

Experts who have supported the Clinton administration's approach to Social Security questioned whether the government could afford the new benefits. Last week, the Social Security trustees' annual report on the system's solvency extended the projected life of the Social Security trust fund to 2037, three years longer than was projected last year. Even so, the trustees warned, retirement of the baby boomers will eventually push the system into bankruptcy unless there are major changes, such as reduced benefits or higher payroll taxes.

Gore has proposed dedicating the entire Social Security surplus, plus interest saved from paying down the federal debt, to shoring up the Social Security trust fund. Virtually all of the interest savings that would be realized by 2011 -- $120 billion -- would be consumed by the additional benefits the vice president is proposing.

"It would be imprudent and unwise to enact benefit increases until and unless we do what President Clinton says we should do, save Social Security," said Henry J. Aaron, a senior fellow of economic studies at the Brookings Institution and a vocal supporter of the administration's past efforts to extend the solvency of Social Security.

Opponents of the administration were more caustic, accusing Gore of pandering to women and senior citizens while ignoring the risks of his proposal. Rep. Bill Archer, a Texas Republican who chairs the Ways and Means Committee, said Gore was "promising election-year goodies to seniors."

Michael Tanner, director of the libertarian Cato Institute's Project on Social Security Privatization, used virtually the same language.

"It strikes me as bordering on irresponsible to dodge fundamental reform, then start passing out the goodies," Tanner said.

Bush approached the Gore proposal gingerly, saying that he, too, wants to improve benefits for elderly women. In perhaps his most open embrace of Social Security privatization, Bush said that could be achieved by shifting some payroll taxes into private accounts that could be invested in the stock market.

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