Bush weighs Social Security tax hike

Conundrum for N.H. lawmaker
The campaign-style event took him to the home turf of GOP Rep. Jeb Bradley, who said during his first run for Congress in 2002 that “privatization is not the answer” to Social Security’s problems.

Though Bush heaped praise on scores of local politicians, from the state’s two Republican senators on down, he did not mention Bradley.

“You don’t have to worry about your senators. They’re people who understand we have got to address the problem,” he said, conspicuously omitting Bradley.

On the eve of the president’s trip, the Democratic National Committee called on Bush to release the details of his Social Security proposal.

But the White House has said the aim now is to sell Americans on the idea that there is an immediate problem, even though the system doesn’t run out of money for decades, in hopes that they will put pressure on their representatives in Washington — like Bradley — to get behind the plan.

Bush aides say the time for the legislative nitty-gritty of writing bills and negotiating with lawmakers will come after this intense public relations phase.

Bush promised to pound on the issue until Congress goes along.

“I’m going to talk to the American people over and over and over again until the members of Congress recognize we have a problem,” he said.

55-and-over strategy
Bush wants to make certain that workers age 55 and over understand that their Social Security benefits will not change under his proposal for private accounts. Political advisers see that as crucial, especially to protect Republicans who fear that Democrats will use their tangling with the popular retirement benefit against them in the 2006 midterm elections.

The president portrayed his plan as both good for the Social Security system and as a crucial step in building ownership for more Americans. But he did not mention that investing in stocks and bonds means workers with private accounts risk seeing their assets shrink, nor did he talk about lower benefits or the enormous transition costs of the accounts, estimated in the trillions of dollars.

He did acknowledge that the private accounts “don’t fix the system.”

Under estimates prepared by the Social Security Administration, the program’s trust funds will begin to pay out more in benefits than they receive in payroll tax revenue beginning in 2018. By 2042, the trust funds will be empty and, under law, benefits will have to start being cut for all beneficiaries as a result.

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