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Bush Backpedaling on Social Security Privatization?

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Is President Bush prepared to OK Social Security reform without his beloved private accounts?

At a White House luncheon with Republican Senators yesterday, Robert Bennett of Utah told President Bush that he would soon propose a bill without the accounts.

But if you think it’s shocking that a Republican Senator would break away from the Bush gameplan, hold onto your hat.

According to an article in the June 22 edition of The Hill, Bennett said that Bush told him to “go ahead” with the bill.

As Jon Stewart might say: “Wha?”


Bush did not comment on the pending legislation. The White House told reporters that Bush’s comments indicate he welcomes a discussion of options.

Other Republican Senators attending the luncheon downplayed Bennett’s pending proposal.

Larry Craig of Idaho said the president “remained very upbeat on his approach” and noted that Bennett’s conversation with the president did not take place in front of the entire delegation.

Senate Republican Conference Chairman Rick Santorum (R-PA), who has been Bush’s main lackey in the Senate on privatization, said Bush’s response to “go ahead” was not an endorsement of Bennett’s alternate proposal.


Bennett, however, seemed optimistic that his alternative plan had a better chance of passage than the president’s.

“Democrats and some Republicans say, ‘We will not vote for anything that includes personal accounts,’ and that seems to have slowed the whole thing down,” Bennett told the Salt Lake Tribune. “My reaction is, that shouldn’t slow the whole thing down and let’s find out how serious people really are when they say, ‘Yes, there really is a problem, but I don’t like personal accounts.'”


The idea that it might be easier to pass Social Security reform without privatization has gained steam of late. Even the author of the reform plan Bush has embraced has suggested as much.

Robert C. Pozen, a Massachusetts investment company executive, called on Bush last month to consider giving up the centerpiece of the his Social Security proposal — the individual investment accounts funded by payroll taxes, also called ‘carve-out accounts.”

“Given the lack of bipartisan support for carve-out personal accounts, the president should not insist on carve-out accounts if the Democrats support an overall legislative package for Social Security reform that is otherwise satisfactory to him,” Pozen said.


Bush hasn’t been able to get traction with his privatization plan, in spite of a whirlwind tour of “town hall” meetings — essentially infomercials in which hand-picked audiences listen to hand-picked questioners in order to hear the President offer answers using hand-picked information.

The president tells people that Social Security will be “bankrupt,” ignoring a Government Accountability Office study that showed that even with no changes, the system would pay out 70% of benefits in 2052. Then after telling his hand-picked audiences that the system will go bankrupt, he touts the privatization plan. What other conclusion could the audiences draw but to assume privatization addresses solvency? One problem, the White House has admitted the plan is “revenue net neutral” over 75 years. Just another minor detail Bush fails to mention during his barnstorming tour.

But even with all that misinformation, the Bush “town hall” meetings haven’t worked. Poll after poll has shown tepid response to the privatization plan. If anything, the more the president repeats himself on privatization, the less popular the plan becomes.

Perhaps, finally, Bush is realizing that his plan will never get passed, and move ahead with real Social Security reform.


This article first appeared on Journalists Against Bush’s B.S. (JABBS)

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About David R. Mark

  • Bush was the one who introduced the debate — it’s just that he failed to mention that his privatization plan doesn’t address solvency.

    Again, if Bush had come to the American people and told us about the wonderments of privatization, it might be an interesting debate. Personally, I don’t see a problem with being able to place a portion of my Social Security into “safe” investments, like municipal bonds.

    But again, that’s not what Bush did. He said the system was broke, and that privatization was the answer, and his hand-picked audiences had no choice but to believe one was a remedy for the other. Why deceive the public?

    No one seems to want to answer that question.

  • Privatization is the route to fairness and a superior system for the future, not solvency. If solvency is all we care about there are lots of ways to achieve it. But if it’s just about solvency then it’s not really an important debate at all. The American people deserve more than the same old crappy system.


  • There is bipartisan support for making Social Security solvent. The problem, again, is that Bush implied during his barnstorming tour that privatization was a path toward solvency, even though the White House admitted it’s not.

    Why should Democrats — and even some Republicans — want to work from such a deceptive starting point?

    The truth is, Bennett is only stepping forward now because the Bush plan is DOA. And some Social Security reform is better than no reform. I’m sure that ultimately, the Bennett plan will not include raising the payroll tax. It will probably include a benefit cut. And that will appease the conservative base, and Bush can declare victory.

    And sadly, that Bush tried to deceive the American people will be forgotten by the media, as it reports that victory.

  • I don’t think it’s fair to characterize Republicans as the antithesis to Social Security. There’s no doubt it needs major change and that cannot be accomplished by this Congress. The only way to facilitate real change is by having a bi-partisan commission outside the control of Capitol Hill craft a plan. Politicians are cowards when it comes to Social Security reform and as a result they are slowly destroying it for future generations.

  • JR

    I more concerned that those things will be accessible to me at all. That’s why I’m not a Republican.

  • >>Money is not any of those things; it is merely a means to them. And not necessarily the only one, or even the best one.<< I'd rather get those things with money I earn than as a government handout, JR. That's why I'm not a Democrat. Dave

  • Dave, you’re right, the Administration’s management hasn’t helped. In theory and principle many of the Bush Administration’s positions are good for the country. Unfortunately, Congress is a stumbling block and it’s not just the Democrats.

    I wish George W. Bush would be more Reaganesque with a twist and just go before the American people with the facts. The Democrats are creating a stalemate and the Republicans are so afraid of polls that they waffle on everything this man is trying to accomplish. I’m no fan of President Bush, but he is in the Oval Office for the next 3 1/2 years and we owe it to ourselves to help this guy do it right. If history judges Bush a failure, Congress deserves much of the blame and ultimately the American people deserve the majority of the blame for not doing something about it.

    And it’s not just money as you so aptly stated. There are the basic necessities in life that we want to provide for our own families without the interference of government. That is the ultimate entitlement program. We are entitled, as Americans, to have the means necessary to achieve our dreams. As long as excessive taxation stifles the chance at opportunity everyone suffers. And, in the end Dave, it all goes back to something I’ve said over and over again: education, education, education!

  • JR

    Dave Nalle: Wow, what a callous statement. It’s not just money, it’s medical care for my kids, it’s keeping my car running, it’s paying my mortgage, it’s saving for retirement, it’s putting food on the table. It’s not just money, it’s everything.

    “Callous”. LOL, nice try.

    Money is not any of those things; it is merely a means to them. And not necessarily the only one, or even the best one.

  • My point regarding solvency is, Bush shouldn’t have implied that privatization will lead to solvency — actually, it was Bush’s main selling point, to rid us of a program that would soon be “bankrupt.”

    Just be honest with the American people. If you believe in privatization, then say so. But don’t sell it as something you know it’s not. There’s no need to trick the American people in order to get legislation passed.

  • You have a point, Silas. If Bush had been more successful with his management of the War on Terror and the War in Iraq then he would have had the leverage to make Congress pay attention and do what he wanted on other issues which were part of his agenda. The agenda he proposed going into this term had a lot of good ideas in it, but nothing much has come of them.

    JR: “It’s just money after all”.

    Wow, what a callous statement. It’s not just money, it’s medical care for my kids, it’s keeping my car running, it’s paying my mortgage, it’s saving for retirement, it’s putting food on the table. It’s not just money, it’s everything. Excessive taxation is the single largest abuse of the public the government engages in. And what the public DOES care about is having their money taken away even if they care about no other rights.


  • JR

    Dave Nalle: Solvency is a minor issue in comparison to the gross violation of individual rights which the system represents as a whole.

    That’s just your unusual perspective. I don’t see taxes as particularly relevant to “individual rights” (it’s just money, after all), and most Americans don’t seem to give a rat’s ass about individual rights in general. They care more about entitlements than about civil liberties.

  • Without it the Bush presidency moves one step closer to being a failure.

    Dave, real Social Security reform would have been the Bush Administration’s only positive legacy. If his administration goes down in history as a failure (as I think it already is), there should be a footnote that Congress had a major hand in assisting in that failure. The buck doesn’t stop at the Oval Office this time.

  • Solvency is a minor issue in comparison to the gross violation of individual rights which the system represents as a whole. Solving the issue of making the system solvent is relatively trivial. Privatization or at least semi-privatization was a revolutionary step forward, the kind of think a president wants to leave as his legacy. Without it the Bush presidency moves one step closer to being a failure.


  • If the Bennett plan gains momentum, with bipartisan support, then the discussion isn’t about private accounts, but about solvency. And then you have a handful of options that can be discussed. If the Democrats are serious about wanting to make the system solvent — and I would argue they are — then it’ll be up to the Republicans to consider either upping the maximum salary that can be taxed, from the current $90,000, or a slight cut in benefits, or any number of other mathematical formulas.

    But the key is, our leaders would finally be looking at ways to make the system solvent. The privatization plan, as is, did not address solvency.

  • THe reporting on this throughout from AP through to NY Times and beyond has been terrible. All the reporting has said is there’s a new plan without private accounts. But that leaves this reader wondering – and so what then is in the plan that reforms social security?

    Woefully crappy reporting.

  • Maurice

    Social Security is a sore issue with me. We have put people in prison for embezzling pension plans yet no politicians have gone to jail for using SS funds to pay for pet projects. No investment counselor would recommend a fund that is guaranteed to pay 75 cents on the dollar.

    Social Security is a bad deal and needs to be privatized. I would be somewhat assuaged if we could just get our money back out of it (no growth).

    I just read my last sentence. Kind of illustrates how pathetic SS really is.

  • however the bil is introduced, you can rest assured everything the Shrub wants will be stuffed in there AFTER it goes to Conference

    private accounts is the least of the worries…it’s the tattoos on the back of the neck that bother me


  • Bennett

    Nice piece of work. I have to go with the term “backpedaling” myself.

    You can spin it any way you want, copperpenny, with whatever divisive labels and/or insults you feel compelled to mouth.

    Won’t change a thing.

  • copperpenny

    I don’t see this as “backpedaling” at all. I have listened as President Bush, has stated, many times, let all options be presented. The idea that this is backpedaling simply because the Democrats and the liberals haven’t come up with their own ideas, other than shouting NO , as a spoiled child, does not make your title correct.