This is a partial transcript of "Special Report With Brit Hume ," Feb. 21, 2005, that has been edited for clarity.

Watch "Special Report With Brit Hume" weeknights at 6 p.m. ET

(BEGIN VIDEO CLIP)

ALAN GREENSPAN, CHMN., FEDERAL RESERVE: I considered the problem a very serious one, one that has to be addressed in my judgment, quite soon and certainly to be in place well before the 2008 leading edge of the baby boom generation retiring.

(END VIDEO CLIP)

JIM ANGLE, GUEST HOST: Fed chairman Alan Greenspan (search) talking about Social Security (search) this week. It is one of the toughest and most partisan policy debates in years now raging in Washington. And will be coming to you in the coming days, as lawmakers hold town meetings all over the country next week. The president wants to let you create a personal account with some of the taxes you pay into Social Security, but there are plenty of objections.

One of the critics is Democratic Senator Jon Corzine of New Jersey, who is the former co-chairman of the investment firm Goldman Sachs, also a member of the Senate Banking Committee.

Senator, Thanks for joining us, sir.

SEN. JON CORZINE (D), NEW JERSEY: Thanks for having me, Jim.

ANGLE: Let me ask you first about what Chairman Greenspan was saying there in talking about — and he’s talking about the solvency in that particular instance, not about personal accounts. Saying that some sort of fix needs to be in place before the baby boomers start to retire in 2008. Do you agree?

CORZINE: Jim, I absolutely agree that it is time to work out a compromise on how we’re going to fund that shortfall that’s out there, whatever year you pick, 2042 or 2052. It’s a lot easier to do today than it will be putting it off two years, four years, 10 years. And I think, actually, the concept of having one of these bipartisan committees sit down and look at the various things that could be addressed.

You know, you can put those personal accounts in there although even Greenspan said they’re not really about the solvency issue; I think it’s a good idea. And let people come back and talk to common sense with folks. And let’s get this problem solved and get son on to the big ones, which are Medicare (search) and Medicaid.

ANGLE: Well, clearly one of the problems here, if you don’t do anything about it before the baby boomers start retiring, their benefits will be locked in. And I don’t think we’ve ever cut benefits for those already in retirement. We’ve changed retirement age. We’ve changed cost of living increases. But I don’t think we’ve ever actually cut benefits, have we?

CORZINE: I don’t think there’ll be any appetite politically, or out in the countryside for people to cut and change after the fact, or after somebody’s retirement, what they’re expecting as are. That just goes against the basic fundamental principles of a contract in America.

So I think we need to address this issue now. I don’t happen to think it’s a crisis. I think when the use the term "bankrupt," I think that’s stretching the edges of truth a little bit. But the fact is, there’s a real problem. It ought to be addressed. It can be addressed now if we do it.

The president put on the table something that I saw his some of own his folks backed away from, which is raising the top of how much income is subject to the payroll tax. And you know, that’s one of those ingredients that needs to be considered.

ANGLE: Right. There’s a lot of things that need to be on the table to sort of fashion something.

Let’s turn to personal accounts. You’re the former co-chairman of Goldman Sachs (search), an investment firm.

CORZINE: I like personal account, not in this context.

ANGLE: Well, you more than many of your colleagues would appreciate the ability of the market to help people invest and accumulate wealth. So what is wrong with the idea of personal accounts in Social Security?

CORZINE: First of all, they don’t deal with the problem at hand, which is how do we get the resources to bridge that gap of making sure that we have guaranteed benefits at the promised level for whatever arise and we want to use, 75 years or even infinity.

The second is thing is that I think it’s a diversion away from what I think is the fundamental purpose of Social Security. Which is providing guaranteed benefits, not only for retirees, but for the disabled and for surviving children and spouses.

Social Security’s purpose is really about serving those needs. And I don’t think personal accounts are the solution, because you’re buying an insurance policy, you’re not buying an investment program. I think we ought to create more investment programs.

As a matter of fact, Rick Santorum (search) and I are promoting something that where we start investment accounts when kids are born. It’s called Kids Account. But that’s because we’re trying to create investment mentality in society. I don’t think that’s what Social Security was designed for.

ANGLE: Well, let me ask you about this. If an individual, under what the president has proposed, actually took the four percentage points of the little over six percent of that an individual pays, and put it into a personal accounts. And took no risks whatsoever, just put into government bonds, they would have exactly what they would have under Social Security when they retire. They’d have exactly the same amount of money.

The only difference is they would actually own it. And if they were to die, they could leave it to their heirs. What’s wrong with that?

CORZINE: Well, Jim, you and I will probably debate this, and this is one of the most complicated parts of it. But there is something called a "claw back." When you take that money out of the Social Security Trust Fund, you’re going to have to pay it back when you retire.

ANGLE: Well, sure. You’re not just giving people money.

CORZINE: Right. And I don’t think you end up with anything more than you would have had if you’d just gone on with the ongoing program that we have today

ANGLE: No. Senator, that was my point. You would have exactly the same amount as you would have if you’d left the money in Social Security. The only difference is you would own it and could leave it to your heirs.

CORZINE: Well, as you know there is this very complicated concept though, that you’d have to pay back for the money that came out of the trust fund. And it would leave you virtually without any serious amount, unless you were one of the high-income payers into Social Security. You know, I don’t think that’s worth the underlying risk.

ANGLE: OK. Got to go. Senator Corzine, thank you so much for joining us. Sir, we appreciate it.

CORZINE: Thank you.

Content and Programming Copyright 2005 Fox News Network, L.L.C. ALL RIGHTS RESERVED. Transcription Copyright 2005 eMediaMillWorks, Inc. (f/k/a Federal Document Clearing House, Inc.), which takes sole responsibility for the accuracy of the transcription. ALL RIGHTS RESERVED. No license is granted to the user of this material except for the user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon Fox News Network, L.L.C.'s and eMediaMillWorks, Inc.'s copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.