An economic slowdown added to unemployment and strained the state's ability to finance pensions and other social benefits.
Beveridge wanted a system based on insurance, with the public making insurance contributions to finance benefits like the state pension.
Mr. Bentsen argued that his bill was simply proposing to tap a trust fund already established to finance extended benefits.
From a macroeconomic perspective, increasing the trust fund's balance, without underlying reform, does nothing to enhance the government's fiscal capacity to finance future benefits.
Otherwise, employed workers in covered employment must finance new benefits by paying higher payroll taxes or accepting reduced benefits.
The McCain amendment proposed eliminating the controversial surtax but keeping a monthly $4 premium to finance secondary benefits.
You could quibble with the question's wording, which presumes that current taxes can finance future benefits.
The tax rates in the bill will fully finance benefits and maintain a safe reserve fund for 20 years longer than the current arrangement will.
He says all the savings will be used to finance new benefits for the elderly, including coverage of prescription drugs and some long-term care.
Mr. Bentsen's proposal would finance extended benefits entirely from the Federal trust fund.
