Veteran lawmaker tells why president is correct to change Social Security
Q. Social Security has been known as the third rail of American politics. Why is the president now advocating such a major change in the program?
A. Because we only have a 13- to 15-year span to fix it at a price the country can really afford. There are budget estimates that show we're losing $600 billion a year as long as we wait.
Q. Granted, but even your own colleagues, including House Ways and Means Chairman Bill Thomas, believe the president's proposal is dead on arrival. Isn't the president facing bipartisan opposition at this point?
A. No, but many of the members can't get over the fact that this has been a political issue that traditionally the Democrats have been able to get us with. But I think that whole thing has moved around. I think the president's re-election should give our members some courage, particularly when talking about the younger people.
The younger people do not believe Social Security will be around for them. They're almost fatalistic about it. I've had hearings at the University of Missouri, I've had hearings here at Florida Atlantic University and other places where we tried to pull young people in and the interest is not there. You'll find that the average age of people who go to these hearings is older than I am.
But, the president, I think, has given the necessary assurance to the seniors and persons 55 years and over that this thing isn't going to be changed [for them], and it's not. I'd go one step further. I'm not going to change it for their kids and grandkids, because I can solve it without doing that.
Q. Please elaborate.
A. If we start adding the personal accounts right now, we have to borrow the money to do it. We don't use any FICA tax. We leave that alone. We don't take anything out of the trust fund and we do not increase taxes and we do not cut benefits.
But, we do borrow money to put into the individual accounts in an amount equal to 4 percent of their wages, capped off at a thousand dollars. This is money that the federal government borrows and puts into these personal accounts.
Those accounts will grow. They will be there to help pay the benefits and so they will take a lot of the pressure off of the Social Security Administration, so that we will be able to pay full benefits for the next 75 years and beyond.
To do nothing, we're facing a $26 trillion cash shortfall over the next 75 years. That's more than all the wages paid in this country. So, we've got to do something.
Q. There are still those big questions, like where do we get the two to three trillion dollars, or whatever the estimate
A. I'd borrow it. I'd borrow it and pay every bit of it back. By 2037, we will start paying it back. I'm also putting a provision in my bill that once that surplus starts coming back in again, the Congress can't touch it. It will have to go toward paying off the bonds.
Q. Do you think the president will go for that?
A. This is different than his plan, but this one I think is politically salable. This one should not be challenged by the AARP. This one makes it extremely difficult for the minority party to attack it as an attack on the Social Security Trust Fund, because I don't touch it. I don't touch it.
It's important that the readers truly understand Social Security had 43 workers per retiree in 1940. Now it's down to a little over three, soon it will be two. It's a pay-as-you-go system. How can we burden our workers with enough FICA tax to truly support two seniors? It's not working.
What we need to do is to start investing now and let those personal accounts grow and be there to pull Social Security out of the ditch when it needs to.
Q. Bush has shown some flexibility in considering reducing benefits and raising retirement age. Do you think he'll show enough flexibility to use your bill to get his personal accounts?