WASHINGTON -- The Senate majority leader, Trent Lott of Mississippi, proposed a commission yesterday to find a way to fix the government's main inflation gauge, providing possible political cover for a deal that would help balance the budget by reducing cost-of-living increases for Social Security.
Lott's statement was the first specific proposal from a Republican leader to solve the problems with the index, which many economists believe overstates inflation and leads the government to overcompensate benefit recipients.
It seemed intended to draw the Clinton administration into a shared effort to resolve the issue, which holds great political peril for Republicans and Democrats alike but could yield the savings that many members of Congress think would be necessary to eliminate the federal budget deficit.
Lott said that the panel of experts he has in mind should recommend a cost-of-living adjustment and that Congress and the White House should accept it. "I think we will do it," Lott said. "I think it should be done."
White House officials were noncommittal in their response but did not criticize Lott's idea.
"Our goal is to find the best broad-based technical agreement on this technical issue," said Gene Sperling, the chairman of the White House's National Economic Council.
The administration has been wary of angering senior citizens and other powerful constituencies yet intrigued by the potential fiscal benefits of fixing the price index. Its position has been that while the index has problems, changes should result from a general consensus among economists.
Pub Date: 2/25/97