The way I understand the SS situation is this(it could be wrong, but anyway): Way back during the Reagan Admin it became apparent that the Baby Boomers were going to muck up the SS program due to their Demographic bubble. So the solution was to hike SS Payments to create a Surplus within that program. That Surplus was then Borrowed by the Government and added to General Revenue. The intent was to then Pay Back to SS that borrowed $ when the Baby Boomer bubble began to occur, which now is coming into affect. When you bring Clinton's Surplus into it, it is somewhat disingenuous to specify Clinton, as that was the SOP established long before him. However, it also is true that it makes Clinton's Surplus kinda iffy, except that it was still a significant accomplishment as it was something that hadn't happened up until that time and the Budgetary situation was going in the right direction to carry the original plan regarding the Baby Boomer bubble and SS through. Al Gore's "Lockbox" was part of that scheme, essentially ending the SS Surplus borrowing and Saving that Surplus to address the eventual Baby Boomer bubble. IOW, rather than the Bush Tax Cuts, Gore was going to create a real Balanced Budget and hold the SS Surplus in liquid form until it could be used to address the bubble.
Tax Cuts *can* have a Stimulative affect, but that stimulus depends on numerous factors. One of those depends on Taxes being excessively high to begin with, so high that they are stifling the Economy. That kind of situation hasn't existed in decades though. Another way they can work is by adding a significant sum of $ into the Private Sector that can be spent by Business and Tax Payers. This simply is useless right now as Business is sitting on a huge pool of $ right now and the only Tax Payers that could possibly receive such sums are also sitting on a huge pool of $ already. This is why during the Bush Admin, despite repeated Tax Cuts, the Economy simply tread water for the most part and the only thing that was Booming were the nefarious activities that resulted in the 2008 Recession that continues to dog the US Economy to this day.
Sorta. It became apparent to many people during and before the Reagan years that the boomers were going to screw up Social Security, which is basically a Ponzi scheme after all. Reagan created by executive order a commission, chaired by Greenspan, to study the issue, but it was a bipartisan commission and a bipartisan bill. Two things were accomplished. First, rates were hiked, which was essential to make the system solvent (at least on paper.) Second, Social Security was placed in a separate account; Congress may not spend it. However, the Social Security account managers spend excess receipts buying government debt. Essentially it's the same thing, just a change in accounting.
That sounds kind of nefarious, and in a way it is. It defeats the entire purpose of separating Social Security into a separate account, rather than just a ledger entry of liabilities that government promises to pay out. But the alternatives aren't good. The Social Security account managers could buy precious metals, but there's no guaranty that metals won't go down. They could buy corporate bonds or stocks, but there again there are no guarantees, and if the actuality of corruption isn't a certainty, the accusation of it certainly would be. Imagine the scandal if Social Security money had been invested largely in the highly profitable housing derivative market - to skyrocket in value and then plummet to worthlessness! Government debt is perhaps the one investment vehicle where accusations of fraud, corruption and favoritism have no teeth.
Personally I wish the excess receipts had been invested in broad-based, solid blue chip mutual funds, but it's easy to see why they weren't. Besides protecting the Social Security fund managers and the integrity (if not solvency) of the trust fund itself, it also pleases Congress by making the true overspending look less worse.
As regards Al Gore's "lock box", that is merely a political vehicle. It's an old Democrat technique to scare seniors by telling them that Republicans want to raid Social Security. As people become increasingly educated, everyone knows that Social Security has been raided long ago and therefore is empty of all but IOUs. It becomes very difficult to scare people into voting for you because your opponent wants to steal a box of IOUs, particularly if you are a sitting Vice-President and a long time member of Congress. (AKA "One of the people who already raided it.) Thus, Al Gore's "lock box" - insisting that the Social Security funds are in a "lock box" full of - well, not IOUs, but "the full faith and trust of the United States government." (Personally I'm not sure why they thought accusing your opponent of wanting to raid a "lock box" full of "the full faith and trust of the United States government" would be more effective than a box of IOUs.) Al Gore's "lock box" is a scare tactic and nothing more. Al Gore personally was not on the commission, was not a significant player in the debate, had nothing to do with the 1983 Social Security Act, and in fact could not even be bothered to show and vote for it.
http://www.ssa.gov/history/tally1983.html
A bit more light reading for those who care.
http://www.ssa.gov/history/1983amend.html
http://www.ssa.gov/history/law.html
There is a huge mystique arisen about Gore that is largely bullshit, due solely to his environmental positions and his importance in Democrat Presidential politics. He was a decent Representative, and a not too horrible Senator until he thought he had an actual shot at being elected President, but he has never been intelligent or a particularly involved (outside of D.C.) kind of guy. And calling his Senate office was an exercise in futility if you weren't a big donor or politically important; they knew nothing, cared less, and suggested you ask your Representative. (For a great Tennessee Senator of the day, look at Jim Sasser.)
I largely agree with you on tax cuts. Probably the best things to do in a severe recession are to do targeted temporary tax rebates to every worker, try to limit the damage by bailing out any huge companies or industries, and wait it out. Tax cuts simply increase the amount of money on the sidelines (which is admittedly good for solvency) and government programs just use $4 to provide $1 of economic activity - and that only until the borrowing ability runs out.
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