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."
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.
"I can't think of a better reform than allowing women to manage their own personal savings accounts, particularly younger workers in our society," he said in a statement.
Gore campaign officials have long wanted to draw Bush into a debate on Social Security privatization, believing that given the volatile financial markets, senior citizens would be alarmed by Bush's support for it. In an ABC News/Washington Post poll released this week, voters were evenly split between the two candidates on the question of who they thought would best protect the Social Security system.
That policy area has traditionally favored Democratic candidates. For Gore to succeed in key Sun Belt states such as Florida, with its many retirees, he will have to take advantage of that.
Gore, Bush disagree
Gore used yesterday's appearance in Philadelphia to assail Bush's sweeping tax-cut proposal, which the vice president says would cut into the Social Security surplus, force drastic cuts in spending on popular government programs or drive the federal government back into deficit spending.
"If he gets his hands on America's retirement system, it will quickly become a system of social insecurity," he told his audience in Philadelphia.
Bush fired back, saying the Clinton-Gore administration has had eight years to enact reforms to save Social Security but has done nothing. He also criticized Gore for casting the tie-breaking vote on the 1993 budget resolution that, among other things, raised taxes on the Social Security benefits of high-income senior citizens.
Gore is scheduled to appear at a Democratic National Committee fund-raising dinner at a private house in Annapolis this evening.