SENATOR: PROTECT BENEFITS CLINTON WANTS TO TRIM SOCIAL SECURITY RAISES

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: MONDAY, February 1, 1993                   TAG: 9302010055
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A1   EDITION: METRO 
SOURCE: From the Los Angeles Times and The Washington Post
DATELINE: WASHINGTON                                LENGTH: Medium
SENATOR: PROTECT BENEFITS CLINTON WANTS TO TRIM SOCIAL SECURITY RAISES
A senior Treasury official said Sunday that the Clinton administration will propose reductions in the rate of growth of Social Security benefits, but a powerful Democratic senator warned that it would be a political "death wish" to seek any cutback in Social Security cost-of-living increases.
Deputy Secretary of the Treasury Roger Altman said in a television interview that eliminating the annual raise in Social Security payments that offset the effects of inflation is under consideration as the White House puts together its economic plan.
"That's a death wish, and let's get it out of the way Moynihan and forget it right now," said Sen. Daniel Patrick Moynihan, D-N.Y., new chairman of the Senate Finance Committee, in a separate interview.
The Senate's leading Republican said just the opposite. On NBC's "Meet the Press," Minority Leader Robert Dole of Kansas said, "I'd rather go to reduce the COLA [cost-of-living adjustment] 1 percent or 2 percent," rather than raise taxes on relatively well-off retirees.
Moynihan vowed to block any effort by President Clinton to limit the cost-of-living increases to senior citizens.
The comments came as Clinton and his Cabinet met at the presidential retreat at Camp David, Md., to discuss the economic package he will submit to Congress Feb. 17 in his State of the Union message.
The package is likely to include a broad-based energy tax, an increase in the tax rate to 36 percent from 31 percent for those earning more than $200,000 a year, a 10 percent surtax on millionaires, deeper military spending cuts and about $20 billion in new spending programs, including increasing job training and accelerating some highway construction projects, and tax cuts to boost the economy, administration officials said.
"We spent a lot of time talking about it," Clinton told reporters as he returned to the White House late Sunday afternoon. He made no other comment.
Altman, a close friend of the president and one of Clinton's top economic advisers during the presidential campaign, said that the administration would advocate restraints on the growth of Medicare, Medicaid, welfare payments and Social Security outlays as part of its efforts to reduce the huge federal budget deficit.
"We all know it's eating the federal budget like a termite, and that has to be dealt with and that will be dealt with in this [economic] program," Altman said on NBC's "One on One with John McLaughlin."
Traditionally, even discussing possible cuts in Social Security benefits or cost-of-living increases has been considered politically fatal in view of the powerful organizations that lobby for retired persons.
About 30 million Americans receive Social Security retirement benefits averaging $650 a month. The most recent cost-of-living increase to offset 1992 inflation - 3.2 percent - amounted to about $19 a month for the average recipient.
In 1983, the Social Security cost-of-living adjustment was delayed six months as part of a plan to rescue the fund from bankruptcy.

by Archana Subramaniam by CNB