I'll devote all the interest savings from debt reduction to the Social Security trust fund.
Specifically, we can make a bipartisan down payment on Social Security reform by crediting the interest savings from debt reduction to the Social Security trust fund to keep it strong and sound for 50 years, beyond the life span of all but the most fortunate of the baby boom generation.
Senate Majority Leader Tom Daschle (D-S.D). said many Democrats could support proposals to shore up the trust fund by using savings from debt reduction, as well as proposals that allow investment by the government, at least on a pilot project basis.
And in this budget, Mr. Hollande and his finance minister, Pierre Moscovici, are making it clear that France will stick to its promises of debt reduction, even with lower growth estimates, in order to keep the trust of the market that buys French bonds.
Social Security does not add to the national debt since it is funded separately from the federal budget and still has a surplus in its trust fund, but conservatives keep throwing it into debt reduction plans.
Except for the money in the Social Security trust fund, which both parties have vowed to use for debt reduction, the cushy surpluses of last spring have melted away in the heat of the summer.
But Democrats attacked Mr. Bush's budget today, even before its details were released, saying the president was in essence raiding Social Security's trust funds in violation of the agreement to use the surplus for debt reduction.
However, it would not change the total debt subject to this statutory limit because that public debt reduction would be offset by an increase in the debt holdings of the Social Security trust funds.
Democrats plan to offer an alternative budget that would reserve all the money in the Social Security and Medicare trust funds and divide the remaining $2.7 trillion in surpluses in thirds -- $900 billion for tax cuts, $900 billion for debt reduction and $900 billion for new spending on a variety of programs.
(James Feyrer and Bruce Sacerdote) Debt reduction without default?
Debt reduction took place in two stages.
