I posted this idea in a comment and it got a good response, so I am posting a diary to generate more discussion.
I think the Democrats should propose repealing the Bush tax cuts and earmark the revenue to fully funding the Social Security trust fund.
While the Social Securty is not in crisis, it does require the government to pay back the Social Security trust fund starting in 2018. This will exacerbate the crisis in the general fund. in addition, The Social Security trust fund has allowed Bush to hide the true costs of the deficits. By making this a political issue we can shift the debate from privatization to the unsustainable budget deficit.
(more after the jump)
Here's a little history. The Social Security trust Fund was set up in 1983 by raising the payroll tax rate in order to create a surplus before the baby boomers retired. As a result we have been paying higher regressive payroll taxes for the last 21 years (coincidentally about the amount of time I have been in the workforce). In 2000, Al Gore was ridiculed for saying we should protect this surplus in a "lockbox" but George W. Bush also claimed he would protect it. The 2000 Bush/Cheney website said, "The Social Security surplus must be locked away only for Social Security."
Immediately after being elected Bush claimed we could have both huge tax cuts and protect Social Security. Paul Krugman did an excellent job destroying that premise in his book "Fuzzy Math" but the press didn't bother to point out that the numbers didn't add up.
Now Bush has spent the surplus and created huge deficits. The Social Security Surplus is currently about $1.6 trillion and is projected to reach about $2.5 trillion by 2009 even if the Bush tax cuts aren't made permanent. Once the Social Security system starts relying on the trust fund in about 2018 that money will have to be paid back. This will require very tough choices given the size of the national debt.
As Josh Marshall pointed out link, the big question in the Social Security debate is "Are the Treasury notes in the Social Security Trust Fund backed by the full faith and credit of the United States every bit as much as the bonds everyone else owns?". In other words, will the government pay back the Social Security trust fund or will they default on American workers.
The Bush tax cuts will cost about $1.3 trillion between 2005 and 2010 link. By repealing these tax cuts we can cover most of the current size of the trust fund.
In addition to starting to address the long term budget problems the U.S. faces, I think this would be good politics for the Democrats. This would turn attention from Social Security privatization to how Bush managed to squander the Social Security surplus and the seriousness of the budget deficit. This will also be a way to show how crazy the idea of making the tax cuts permanent is and make the Republicans publicly state whether or not they support Social Security or tax cuts for the rich.
There is, of course, a political cost associated with advocating for tax increases, but our current fiscal course is unsustainable and Bush's tax cuts do little for most people. We really do have a choice between tax cuts and Social Security, I think most people would choose Social Security.