Sept. 26 Democratic debate transcript

Russert: And we're back at Dartmouth College talking to the Democrats.  I want to talk about Social Security and Medicare.

The chairman of the Federal Reserve, the head of the Government Accountability Office have both said that the number of people in America on Social Security and Medicare is going to double in the next 20 years -- there are now 40 million; it's going to go to 80 million -- and that if nothing is done, we'll have to cut benefits in half or double the taxes.  That is their testimony.

Senator Biden, in order to prevent that, would you be willing to consider certain steps?  For example, back in 1983, Ronald Reagan and Tip O'Neill, Patrick Moynihan and Bob Dole got together and changed the retirement age.  It's going to be going up to 67 in a gradual increase.

Right now, you pay tax for Social Security on your first $97,500 worth of income.

Why not tax the entire income of every American?  And if you do that, you'll guarantee the solvency of social security farther than I can see.

Biden: The answer is yes.  I'm probably the only one up here who's going to say that, but the truth of the matter is, you stated it.  You're either going to cut benefits, or you're going to go ahead and raise taxes above the first $97,000.

And, by the way, I was in that room with Pat Moynihan.  It was Joe Biden, Pat Moynihan, Bob Dole -- it was also George Mitchell -- when we made that deal.  And I'll never forget Bob Dole turning to Pat Moynihan and saying, "We all got to jump in this boat at the same time."

So the bottom line here is, you can't do it by growing the economy alone.  So I would raise the cap.

Russert: Would you also, considering now life expectancy is 78, considering -- consider gradually raising the retirement age?

Biden: We did that one -- I supported that; that's what got it solvent to 2041.  By simply going and taking -- raising the cap, you can solve the problem.

Russert: Senator Clinton, would you be in favor of saying to the American people, "I'm going to tax your income; I'm not going to cap at $97,500.  Everyone, even if you are a millionaire is going to pay Social Security tax on every cent they make."

Clinton: Well, Tim, let me tell you what I think about this, because I know this is a particular concern of yours.  But I want to make three points very briefly.

First, I do think that it is important to talk about fiscal responsibility.  You know, when my husband left office after moving us toward a balanced budget and a surplus, we had a plan to make Social Security solvent until 2055.

Now, because of the return to deficits, we have lost 14 years of solvency.  It's now projected to be solvent until 2041.  Getting back on a path to fiscal responsibility is absolutely essential.

Number two, I think we do need another bipartisan process.

Clinton: You described what happened in '83.  It took presidential leadership, and it took the relationships between the White House and Capitol Hill, to reach the kind of resolution that was discussed.  And I think that has to be what happens again, but with a president who is dedicated to Social Security, unlike our current president, who has never liked Social Security.  You can go back and see when he first ran for Congress, he was dissing Social Security.

So when I'm president, I will do everything to protect and preserve Social Security so we can have that kind of bipartisanship.

And, finally, then you can look in the context of fiscal responsibility and of a bipartisan compromise -- what else might be done.  But I think if you don't put fiscal responsibility first, you're going to really make a big mistake, because we demonstrated in the '90s, it had a lot to do with moving us toward solvency.

Russert: But you would not take lifting the cap at $97,500 off the table?

Clinton: Well, I'd take everything off the table until we move toward fiscal responsibility and before we have a bipartisan process. I don't think I should be negotiating about what I would do as president.  You know, I want to see what other people come to the table with.

Russert: But Senator Biden said you can't grow your way out of this.  And, for the record, when the Clinton administration left office, Social Security was only guaranteed to 2038, not 2055.

Clinton: There was a plan on the basis of the balanced budget and the surplus to take it all the way to 2055.  And we know what happened: George Bush came in, went back to deficits, and has basically used the Social Security trust fund and borrowing from China and other countries to pay for the war.

Russert: So, Senator, a simple question, a simple question: What do you put on the table?  What are you willing to look at to say, "We're not going to double the taxes, we're not going to cut benefits in half; I'm willing to put everything on the table, some things on the table, nothing on the table"?

Clinton: I'm not putting anything on the proverbial table until we move toward fiscal responsibility.  I think it's a mistake to do that.

Russert: Senator Obama?

Obama: I think that lifting the cap is probably going to be the best option.

Now, we've got to have a process that's already been talked about.  Joe participated back in 1983.  We need another one. And I think -- I've said before, everything should be on the table.

My personal view is that lifting the cap is much preferable than the other options that are available.  But what's critical is to recognize that there is a potential problem.

As I travel around Iowa and New Hampshire I meet young people who don't think Social Security is going to be there for them.  They don't believe it's going to be there for them.

And I think it's important for us, in addition to getting our fiscal house in order, to acknowledge as Democrats that there may be a problem that we've got to take on.

And we should be willing to do anything that will strengthen the system to make sure that we are being true to the sake of trust of those who are already retired as well as young people in the future.

And we should reject things that will weaken the system, including privatization, which essentially is going to put people's retirement at the whim of the stock market.

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