Bill Clinton on Social Security

President of the U.S., 1993-2001; Former Democratic Governor (AR)


Proposed a small portion of Trust Fund be in mutual funds

[During the 1990s] the state of our union was stronger than ever, and I outlined a program, a series of initiatives to create a secure retirement for the baby boom generation. I proposed to commit 60 percent of the surplus over the next fifteen years to extend the solvency of the Social Security Trust Fund until 2055, a small portion of it to be invested in mutual funds.
Source: My Life, by Bill Clinton, p.842 , Jun 21, 2004

Universal Savings Accounts: tax credits for private savings

Here's an idea for helping the bottom half share in the nation's prosperity. Give them, literally, a share in America. Spread the capitalism by spreading capital. Rather than just redistribute income to people after they've become poor, give them capital up front to build their fortunes. Give a young family a starter nest egg. Give a young adult a capital stake.

In the last few years, there have been several proposals for accomplishing this ambitious idea. Under Clinton's proposed Universal Savings Accounts. Families earning under $40,000 would get an annual $600 tax credit, plus another $700 if they deposited $700 of their own money into their account. This adds up to an annual nest egg of $2,000. If they continue saving in this way for 40 years, assuming a modest 5% rate of return, their nest egg would accumulate into a brontosaurus egg of over $250,000. Higher-income families would get a smaller subsidy. Total cost to taxpayers: about $30 billion a year, most of which would go to poor families.

Source: I'll Be Short, by Robert Reich, p. 57-58 , May 2, 2002

Before Social Security, being old meant being poor

With the number of elderly Americans set to double by 2030, the baby boom will become a senior boom. So first, and above all, we must save Social Security for the 21st century.

Early in this century, being old meant being poor. Even today, without Social Security, half our Nation's elderly would be forced into poverty.

Today, Social Security is strong. But by 2013, payroll taxes will no longer be sufficient to cover monthly payments. By 2032, the Trust Fund will be exhausted and Social Security will be unable to pay the full benefits older Americans have been promised.

The best way to keep Social Security a rocksolid guarantee is not to make drastic cuts in benefits, not to raise payroll tax rates, not to drain resources from Social Security in the name of saving it. Instead, I propose that we make the historic decision to invest the surplus to save Social Security.

Source: Pres. Clinton's 1999 State of the Union message to Congress , Jan 19, 1999

USA accounts: retirement security for the 21st century

I propose a new pension initiative for retirement security in the 21st century. I propose that we use a little over 11% of the surplus to establish universal savings accounts--USA accounts--to give all Americans the means to save. With these new accounts, Americans can invest as they choose and receive funds to match a portion of their savings, with extra help for those least able to save. USA accounts will help all Americans to share in our Nation's wealth and to enjoy a more secure retirement. One of the greatest concerns of our baby boom generation is not to let our growing old place an intolerable burden on our children. Our fiscal discipline now gives us an opportunity to lift that burden.

Saving Social Security & Medicare, creating USA accounts, this is the right way to use the surplus. If we set aside 60% of the surplus for Social Security and 16% for Medicare, we will still have resources to meet critical needs.

Source: Pres. Clinton's 1999 State of the Union message to Congress , Jan 19, 1999

Create optional Individual Development Accounts

PROMISE: To create optional Individual Development Accounts for low-income Americans to encourage savings with federal matching funds.

STATUS: This idea was included in the Work and Responsibility Act proposed in Congress and has recently been embraced by the GOP as part of a piece of tax legislation. Though it will not pass before the end of 1996, it will likely become law in the foreseeable future.

PROMISE: To raise earning limitations so recipients can collect more income along with their benefits.

STATUS: The President signed into law a provision that will gradually increase the Social Security earnings limit to $30,000 by the year 2002. For 1996, the earnings limit is $11,520.

Source: State of the Union, by T.Blood & B.Henderson, p.146 , Aug 1, 1996

Safeguard retirement plans and minimize risk

We should encourage companies to offer pension and retirement plans for their workers. We need to make it easier for workers to set aside enough of their current income for retirement.

We need to make sure that pensions are not at risk, either because they are dangerously underfunded or because they are vulnerable to misuse by employers.

As with health coverage, when workers change or lose their jobs, they ought to be able to carry their retirement savings with them and keep right on saving.

Source: Between Hope and History, by Bill Clinton, p. 55-56 , Jan 1, 1996

Create Retirement Savings Accounts.

Clinton adopted the manifesto, "A New Agenda for the New Decade":

Balance America’s Commitments to the Young and the Old
An ever-growing share of the federal budget today consists of automatic transfers from working Americans to retirees. Moreover, the costs of the big entitlements for the elderly -- Social Security and Medicare -- are growing at rates that will eventually bankrupt them and that could leave little to pay for everything else government does. We can’t just spend our way out of the problem; we must find a way to contain future costs. The federal government already spends seven times as much on the elderly as it does on children. To allow that ratio to grow even more imbalanced would be grossly unfair to today’s workers and future generations. In addition, Social Security and Medicare need to be modernized to reflect conditions not envisioned when they were created in the 1930s and the 1960s. Social Security, for example, needs a stronger basic benefit to bolster its critical role in reducing poverty in old age. Medicare needs to offer retirees more choices and a modern benefit package that includes prescription drugs. Such changes, however, will only add to the cost of the programs unless they are accompanied by structural reforms that restrain their growth and limit their claim on the working families whose taxes support the programs.

Source: The Hyde Park Declaration 00-DLC7 on Aug 1, 2000

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Other past presidents on Social Security: Bill Clinton on other issues:
Former Presidents:
Barack Obama(D,2009-2017)
George W. Bush(R,2001-2009)
Bill Clinton(D,1993-2001)
George Bush Sr.(R,1989-1993)
Ronald Reagan(R,1981-1989)
Jimmy Carter(D,1977-1981)
Gerald Ford(R,1974-1977)
Richard Nixon(R,1969-1974)
Lyndon Johnson(D,1963-1969)
John F. Kennedy(D,1961-1963)
Dwight Eisenhower(R,1953-1961)
Harry S Truman(D,1945-1953)

Past Vice Presidents:
V.P.Joseph Biden
V.P.Dick Cheney
V.P.Al Gore
V.P.Dan Quayle
Sen.Bob Dole

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Page last updated: Feb 22, 2022