Bush: 'I'm worried about gasoline prices'

Ron Insana: Mr. President, thanks for talking to us today upon your return from Columbia, S.C., still on the Social Security program, reform program down there. What's the reception among the people when you go out in the towns and talks to them about it?

President Bush: You know, good where I go, but the most important group of people look at it, kinda the people at large. Do they understand we have a problem? In other words, my strategy has been to say there is a problem and now I'm gonna go explain the problem to the American people, and the problem is pretty easy. Baby boomers like me are getting ready to retire and we're gonna live longer, we've been promised greater benefits than the previous generation.

There's a lot of us. Fifty percent more people will be retired when the baby boomers fully retire than the current generation, and there are fewer people paying into the system, which leads to, you know, a deficit in Social Security relatively quickly.

And so I've been explaining the problem to the American people, and it's important -- and by the way, I'm just starting -- and it's important for people to see there's a problem, Ron, because once they see there's a problem, then the next logical step is to say to people elected to public office, 'Why don't you do something about it?'

And so the response has been good. I'm very pleased.

Insana: Now the Washington Post reported, though, that some of the working poor are afraid of making these investment choices in the personal savings accounts that you're offering, and that they would rather have the government just do what it's been doing for the last 70 years, and kind of take that burden away from them.

What do you tell them? How do you explain the program to them?

President Bush: Well, I would explain that if -- you know, personal accounts would be a voluntary plan. In other words, if a worker's nervous about managing his or her own money, and that's what we're talking about, his or her own money, in a conservative mix of bonds and stocks, if that makes somebody nervous, then just stay in the system, however it looks, after there's a permanent fix.

You know, one of the things I think that's very important for people to understand is that there are plans such as this, the idea of private savings in the government. In other words, people from all walks of life have managed their own money through a federal thrift savings plan.

And so when I say that the program ought to give younger workers a better deal by allowing them to save in a personal savings, I'm not inventing something new. This is an idea that has been tried and has worked.

The other thing I say to the person who expresses concern is that I think the government has an obligation to explain to the working person that he or she can earn a better rate of return on her money on a conservative mix of instruments as opposed to what the government has earned.

Insana: But let me ask you about that. Last week, the stock market suffered its worst week in two years.

President Bush: Yeah.

Insana: It's been five years since we hit the all-time highs for the Dow-Jones Industrial Average or the NASDAQ. Someone joked earlier that, you know, the bad news is the stock market's going down. The good news is that my Social Security money isn't in there. Is this the wrong time to be talking about putting Social Security money into the stock market?

President Bush: No. Listen, now's the right time to talk about permanently fixing Social Security because every year we wait it costs $600 billion more for the next generation. In other words, it's going to cost that much more money a year by -- if there's political delay.

Secondly, I mean, I think most people will tell you that if you hold money over a long term, the rate of return on a conservative mix of bonds and stocks clearly is greater than that which the government earns on your behalf.

And finally, there are ways to design plans that take risk out of a plan. In other words, you switch your mix of bonds and stocks to an instrument that allow, that will take care of any market swings toward the end of your retirement, and so there's a -- look, I mean, I cannot believe that people aren't willing, and aren't willing to say to a younger worker, if you so choose, if it's your desire, you should be allowed to manage some of your own money in a personal savings account, just like congressmen and senators get to do.

And I think most people are wise to what it means to manage money. One of the things I said in my speech [Monday] is that we're dealing with a different culture now, Ron, than when you and I grew up.

I mean, a lotta young workers are used to 401(k)s or IRAs. They're used to managing their own money and it makes sense to make sure that the Social Security system allows the younger worker that option, so that the system is a better deal for younger workers.

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