In her Sept. 7 Viewpoint, "Budget issues worry inquisitive 'leftist,'" Melanie Benesh recently raised the issue of President Bush breaking his promise and "raiding the Social Security surplus."

Other writers and politicians — both conservative and liberal — have, in the past, raised the same issue. As a point of reference, given the current laws this is a non-issue. When the Social Security law was passed in 1935, the only "safe" investments were United States government securities. Thus, the law was written so all Social Security revenues in excess of current social security payments (the "Social Security surplus") must be invested in securities issued by the government.

The important word there is "must," not "should." If the federal government does not run a deficit, then the Social Security Administration must go into the securities market in general to buy eligible U.S. government securities from current holders of those securities, be they the Federal Reserve, banks, insurance companies, firms, foreign governments and banks, individuals or whoever.

Therefore, the past pledge from both parties that they would not "raid" the Social Security surplus is meaningless if it does not mean that both parties pledged to have a balanced administrative budget or to have a surplus in that budget. If there is an administrative budget deficit, then the federal government must issue new securities to finance that deficit and those securities — directly or indirectly — will be purchased by the Social Security Administration as long as it has an excess of current revenues over current expenditures.

For either party to pledge that it will not raid the Social Security surplus is meaningless unless they absolutely guarantee that they will have a balanced budget or a surplus in the budget. Being a skeptic, I doubt very much that either party will bring that about during my lifetime.

Smiley is a professor of economics.

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