THIS STORY HAS BEEN FORMATTED FOR EASY PRINTING

Fiscal security By 0, 9/16/2001 THE ENDURING economic strength of the United States provides assurances of eventual victory in the struggle against terrorism. Congress, which last week approved a $40 billion appropriation to cope with the catastrophe, ought to consider as well how to pay for these continuing expenses. Congress and President Bush agreed to double his initial $20 billion request so that New York, Virginia, and Pennsylvania, where the airliners crashed, would be assured of money for recovery. Bush will also soon be asking for another appropriation to pay for future military operations. The $40 billion and subsequent spending can be obtained, without raising taxes or issuing new debt, by raiding the $500 billion or more in Social Security taxes collected annually, far more than is needed to pay benefits. Congress approved the $40 billion unanimously, but how to pay for a continuing anti-terror ''war'' will be a more divisive issue. New sources of revenue do not have to be found immediately. If taxes were raised, they could diminish the modest boost to the economy that will be provided by the injection of $40 billion. But payback cannot be deferred indefinitely and will come either in the form of new tax revenue, government bonds, or permanent drawdowns of the Social Security surplus. The baby boomers' retirement will put unprecedented stress on the trust funds for the Social Security and Medicare programs and on government finances in general. Bush favors a partial privatization of both systems. We on this page believe that both can be preserved intact if changes are made now to increase revenue going into the funds. Whatever plan is adopted to deal with this far-off crisis is best implemented soon, while the trust funds are running surpluses in anticipation of baby boomers' needs. The suicide hijackings might have been difficult to foresee, but future fiscal difficulties are not. Congress needs to finance the campaign against terrorism without compromising the fiscal security of the United States. This story ran on page D6 of the Boston Globe on 9/16/2001. © Copyright 2001 Globe Newspaper Company.