Social Security Long-Term Protection Act of 1993

Summary: Social Security Long-Term Protection Act of 1993 - Amends the Internal Revenue Code to vary the tax rates for the old age, survivors and disability insurance program (title II of the Social Security Act) in 1994 and thereafter, dependent upon the amount in the OASDI trust fund reserve.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Social Security Long-Term Protection 
Act of 1993''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress hereby finds that--
            (1) public confidence in the old-age, survivors, and 
        disability insurance program under the Social Security Act has 
        been undermined by the nature of the political debate which 
        attends the major decisions affecting the program; and
            (2) that the treatment of the old-age, survivors, and 
        disability insurance program under the Social Security Act as a 
        political issue is of grave concern to--
                    (A) working Americans who bear the ever-increasing 
                social security tax burden and have growing doubts 
                about the program's stability; and
                    (B) young Americans, who object to the social 
                security tax altogether because they do not believe it 
                will survive long enough for them to derive any 
                benefits from it.
    (b) Additional Findings.--Congress further finds that--
            (1) under current projections through the year 2025, 
        surplus income for the old-age, survivors, and disability 
        insurance program will grow to an amount equal to two years of 
        outlays by the year 2000, and to an amount equal to three and 
        one-third years of outlays by 2015;
            (2) at the current rate of social security outlays, a 
        reserve of three and one-third years would total over 
        $1,000,000,000,000;
            (3) a reserve in that amount would be unnecessary, and 
        would be viewed by both the Congress and the American people as 
        excessive taxation.
    (c) Purposes.--The purposes of this Act are--
            (1) to permanently ensure the viability and certainty of 
        the old-age, survivors, and disability insurance program;
            (2) to guarantee that social security taxes be no more than 
        necessary to meet the program's current obligations, plus an 
        appropriate reserve.

SEC. 3. FLOATING OASDI TAX RATES AFTER 1994.

    (a) Rate of Tax on Employees.--Subsection (a) of section 3101 of 
the Internal Revenue Code of 1986 (relating to rate of tax on 
employees) is amended to read as follows:
    ``(a) Old-Age, Survivors, and Disability Insurance.--
            ``(1) General rule.--In addition to other taxes, there is 
        hereby imposed on the income of every individual a tax equal to 
        the percentage determined under this subsection of the wages 
        (as defined in section 3121(a)) received by any individual 
        during any calendar year with respect to employment (as defined 
        in section 3121(b)). The percentage determined under this 
        subsection is--
                    ``(A) in cases of wages received during 1994, 6.2 
                percent, and
                    ``(B) in cases of wages received during any 
                calendar year after 1994, the percentage determined 
                under this subsection for the prior calendar year, 
                unless paragraph (2) or (3) applies with respect to 
                such wages.
            ``(2) Percentage in the case of at least a 60-percent oasdi 
        trust fund reserve.--
                    ``(A) Rule governing applicability of paragraph.--
                This paragraph applies with respect to wages received 
                during any calendar year (after 1994) if the OASDI 
                trust fund reserve on September 30 of the prior 
                calendar year is--
                            ``(i) not less than 60.0 percent of the 
                        total amount of the OASDI trust fund 
                        expenditures during the fiscal year ending with 
                        such September 30, and
                            ``(ii) not less than the OASDI trust fund 
                        reserve on the last preceding September 30.
                    ``(B) Determination of percentage.--If this 
                paragraph applies with respect to wages received during 
                any calendar year, the percentage determined under this 
                subsection with respect to such wages shall be equal to 
                the excess of--
                            ``(i) the percentage determined under this 
                        subsection for the prior calendar year, over
                            ``(ii) 0.4 percent.
            ``(3) Percentage in the case of less than a 55-percent 
        oasdi trust fund reserve.--
                    ``(A) Rule governing applicability of paragraph.--
                This paragraph applies with respect to wages received 
                during any calendar year (after 1994) if the OASDI 
                trust fund reserve on September 30 of the prior 
                calendar year is less than 55.0 percent of the total 
                amount of the OASDI trust fund expenditures during the 
                fiscal year ending with such September 30.
                    ``(B) Determination of percentage.--The percentage 
                determined for any calendar year under this paragraph 
                shall be equal to the sum of--
                            ``(i) the percentage determined under this 
                        subsection for the prior calendar year, plus
                            ``(ii) 0.4 percent.''.
    (b) Rate of Tax on Employers.--Subsection (a) of section 3111 of 
such Code (relating to rate of tax on employers) is amended to read as 
follows:
    ``(a) Old-Age, Survivors, and Disability Insurance.--
            ``(1) General rule.--In addition to other taxes, there is 
        hereby imposed on every employer an excise tax, with respect to 
        having individuals in his employ, equal to the percentage 
        determined under this subsection of the wages (as defined in 
        section 3121(a)) paid by him during any calendar year with 
        respect to employment (as defined in section 3121(b)). The 
        percentage determined under this subsection is--
                    ``(A) in cases of wages paid during 1994, 6.2 
                percent, and
                    ``(B) in cases of wages paid during any calendar 
                year after 1994, the percentage determined under this 
                subsection for the prior calendar year, unless 
                paragraph (2) or (3) applies with respect to such 
                wages.
            ``(2) Percentage in the case of at least a 60-percent oasdi 
        trust fund reserve.--
                    ``(A) Rule governing applicability of paragraph.--
                This paragraph applies with respect to wages paid 
                during any calendar year (after 1994) if the OASDI 
                trust fund reserve on September 30 of the prior 
                calendar year is--
                            ``(i) not less than 60.0 percent of the 
                        total amount of the OASDI trust fund 
                        expenditures during the fiscal year ending with 
                        such September 30, and
                            ``(ii) not less than the OASDI trust fund 
                        reserve on the last preceding September 30.
                    ``(B) Determination of percentage.--If this 
                paragraph applies with respect to wages paid during any 
                calendar year, the percentage determined under this 
                subsection with respect to such wages shall be equal to 
                the excess of--
                            ``(i) the percentage determined under this 
                        subsection for the prior calendar year, over
                            ``(ii) 0.4 percent.
            ``(3) Percentage in the case of less than a 55-percent 
        oasdi trust fund reserve.--
                    ``(A) Rule governing applicability of paragraph.--
                This paragraph applies with respect to wages paid 
                during any calendar year (after 1994) if the OASDI 
                trust fund reserve on September 30 of the prior 
                calendar year is less than 55.0 percent of the total 
                amount of the OASDI trust fund expenditures during the 
                fiscal year ending with such September 30.
                    ``(B) Determination of percentage.--The percentage 
                determined for any calendar year under this paragraph 
                shall be equal to the sum of--
                            ``(i) the percentage determined under this 
                        subsection for the prior calendar year, plus
                            ``(ii) 0.4 percent.''.
    (c) Rate of Self-Employment Tax.--Subsection (a) of section 1401 of 
such Code (relating to rate of tax on self-employment income for old-
age, survivors, and disability insurance) is amended to read as 
follows:
    ``(a) Old-Age, Survivors, and Disability Insurance.--
            ``(1) General rule.--In addition to other taxes, there 
        shall be imposed for each taxable year, on the self-employment 
        income for such taxable year, a tax equal to the percentage 
        determined under this subsection of the self-employment income 
        for such taxable year. The percentage determined under this 
        subsection is--
                    ``(A) in cases of self-employment income for the 
                first taxable year beginning after December 31, 1993, 
                12.4 percent, and
                    ``(B) in cases of self-employment income for each 
                subsequent taxable year, the percentage determined 
                under this subsection for the prior taxable year, 
                unless paragraph (2) or (3) applies with respect to 
                such self-employment income.
            ``(2) Percentage in the case of at least a 60-percent oasdi 
        trust fund reserve.--
                    ``(A) Rule governing applicability of paragraph.--
                This paragraph applies with respect to self-employment 
                income for any taxable year (referred to in paragraph 
                (1)(B)) if the OASDI trust fund reserve on September 30 
                of the calendar year preceding such taxable year is--
                            ``(i) not less than 60.0 percent of the 
                        total amount of the OASDI trust fund 
                        expenditures during the fiscal year ending with 
                        such September 30, and
                            ``(ii) not less than the OASDI trust fund 
                        reserve on the last preceding September 30.
                    ``(B) Determination of percentage.--If this 
                paragraph applies with respect to self-employment 
                income for any taxable year, the percentage determined 
                under this subsection with respect to such self-
                employment income shall be equal to the excess of--
                            ``(i) the percentage determined under this 
                        subsection for the prior taxable year, over
                            ``(ii) 0.8 percent.
            ``(3) Percentage in the case of less than a 55-percent 
        oasdi trust fund reserve.--
                    ``(A) Rule governing applicability of paragraph.--
                This paragraph applies with respect to self-employment 
                income for any taxable year (referred to in paragraph 
                (1)(B)) if the OASDI trust fund reserve on September 30 
                of the calendar year preceding such taxable year is 
                less than 55.0 percent of the total amount of the OASDI 
                trust fund expenditures during the fiscal year ending 
                with such September 30.
                    ``(B) Determination of percentage.--The percentage 
                determined for any calendar year under this paragraph 
                shall be equal to the sum of--
                            ``(i) the percentage determined under this 
                        subsection for the prior calendar year, plus
                            ``(ii) 0.8 percent.''.
    (d) Definitions.--
            (1) Amendment to fica provisions.--Section 3121 of such 
        Code (relating to definitions) is amended by adding at the end 
        thereof the following new subsections:
    ``(y) OASDI Trust Fund Reserve.--For purposes of this chapter, the 
term `OASDI trust fund reserve', on September 30 of any calendar year, 
means the sum of--
            ``(1) the balance in the Federal Old-Age and Survivors 
        Insurance Trust Fund as of such date, and
            ``(2) the balance in the Federal Disability Insurance Trust 
        Fund as of such date.
    ``(z) OASDI Trust Fund Expenditures.--For purposes of this chapter, 
the term `OASDI trust fund expenditures', during any fiscal year, means 
the sum of--
            ``(1) the total amount which was paid from the Federal Old-
        Age and Survivors Insurance Trust Fund during such fiscal year 
        for all purposes authorized by section 201 of the Social 
        Security Act, but excluding any transfer payments between such 
        Trust Fund and the Federal Disability Insurance Trust Fund and 
        reducing the amount of any transfers to the Railroad Retirement 
        Account by the amount of any transfers into such Trust Fund 
        from that Account, and
            ``(2) the total amount which was paid from the Federal 
        Disability Insurance Trust Fund during such fiscal year for all 
        purposes authorized by section 201 of such Act, but excluding 
        any transfer payments between such Trust Fund and the Federal 
        Old-Age and Survivors Insurance Trust Fund and reducing the 
        amount of any transfers to the Railroad Retirement Account by 
        the amount of any transfers into such Trust Fund from that 
        Account.''.
            (2) Amendment to seca provisions--Section 1402 of such Code 
        (relating to definitions) is amended by adding at the end 
        thereof the following new subsections:
    ``(k) OASDI Trust Fund Reserve.--The term `OASDI trust fund 
reserve', on September 30 of any calendar year, means the sum of--
            ``(1) the balance in the Federal Old-Age and Survivors 
        Insurance Trust Fund, as of such date, and
            ``(2) the balance in the Federal Disability Insurance Trust 
        Fund, as of such date.
    ``(l) OASDI Trust Fund Expenditures.--The term `OASDI trust fund 
expenditures', during any fiscal year, means the sum of--
            ``(1) the total amount which was paid from the Federal Old-
        Age and Survivors Insurance Trust Fund during such fiscal year 
        for all purposes authorized by section 201 of the Social 
        Security Act, but excluding any transfer payments between such 
        Trust Fund and the Federal Disability Insurance Trust Fund and 
        reducing the amount of any transfers to the Railroad Retirement 
        Account by the amount of any transfers into such Trust Fund 
        from that Account, and
            ``(2) the total amount which was paid from the Federal 
        Disability Insurance Trust Fund during such fiscal year for all 
        purposes authorized by section 201 of such Act, but excluding 
        any transfer payments between such Trust Fund and the Federal 
        Old-Age and Survivors Insurance Trust Fund and reducing the 
        amount of any transfers to the Railroad Retirement Account by 
        the amount of any transfers into such Trust Fund from that 
        Account.''.
    (e) Effective Date.--The amendments made by this section shall 
apply with respect to wages received and wages paid during calendar 
years after 1993 and self-employment income for taxable years beginning 
after December 31, 1993.