This is a partial transcript from "Your World with Neil Cavuto," March 23, 2005, that was edited for clarity.

NEIL CAVUTO, HOST: There's got to be something in the investment water these days. Everybody is miserable.

First, Alan Greenspan (search) hikes rates, and everybody says he's going to keep hiking them, killing stocks. Then all these polls out that say that the president is whistling in the dark if he thinks we're going to get Social Security reform.

Oh, yes, then these rising oil prices (search), enough to make anyone lay down and fold, but not the treasury secretary of the United States. One of the most optimistic guys I know.

John Snow (search) remembers well the doubters that the president would never get those tax cuts through and the jobs wouldn't recover, the markets wouldn't rebound. He said wrong on all counts. He was right on all counts. We thought we'd have him back again.

Secretary, good to have you.

JOHN SNOW, TREASURY SECRETARY: Thanks, Neil. Good to be back with you.

CAVUTO: Give us hope here. Is this thing going to happen or no?

SNOW: Well, Social Security absolutely is going to happen. We're in the early innings...

CAVUTO: It doesn't look good. It doesn't look good. It might be the early innings, but you're way behind.

SNOW: Well, I have a little different read on that than you do. I think real progress is being made. The president wanted a broad dialogue with the country. And what's going on? We've got that broad dialogue at lunch counters, dinner tables, breakfast tables all over America.

CAVUTO: Yes, they're having a dialogue, Secretary, and I guess what they're saying, at least depending on these polls, and you're right, they could all be conjecture, that Americans don't want it. They're afraid about it. They think that you're about to torpedo the system. What do you say?

SNOW: Well, I say what we're trying to do now is make sure that there's a good broad-based understanding of the nature of the problem. Today earlier, the trustees of the Social Security released their report. And they found that the system is on an unsustainable course.

CAVUTO: That it would go broke in 2041, right?

SNOW: They called for action, recognizing that every year we wait, Neil, every year we wait the problem gets bigger and more complicated. It became a bigger actuarial problem this year than last year. If we don't act, it will be a bigger problem next year than it is this year.

So you know, the responsible thing to do is to act and, you know, I'm going to go back to what I said earlier. I'm optimistic that we'll see action, and we're going to see action that includes the personal accounts.

CAVUTO: Let me ask you about the income threshold. We had Karl Rove here last week, sir. And he didn't deny that that was one of the things that was on the table, that is raising the $90,000 threshold, while he was against hiking the FICA tax itself, but didn't seem against raising that threshold.

Is that the secret toward getting the administration to go along with this privatized plan to get wayward Republicans and Democrats off the fence?

SNOW: Well, there are lots of ideas out there, and what we need to have now is a broad discussion with the Congress...

CAVUTO: Including the threshold? Including the threshold?

SNOW: Well, in which all sorts of ideas get debated and discussed. I wouldn't start there, frankly. But the president said he wants a climate of ideas. We can't keep ruling things out if we want a climate of ideas.

But as you know, as well as I, some ideas are better than others. We want to get the best ideas in the package that eventually comes through the Congress.

CAVUTO: In the beginning we're going to be looking at a lot of borrowing to finance this rollover from what we've got now to this private accounts system. It could be anywhere from $1 trillion to $3 trillion, we're told. Is that all money that we borrow or that's all new treasury notes and bonds issued or what?

SNOW: Well, those numbers you're citing are a little high, I think.

CAVUTO: What do you think they are?

SNOW: Well, we put $750 billion in the president's budget proposal for the first 10 years. Those are very manageable amounts. They won't have significant effects on our financial markets.

And all of that borrowing, interestingly, goes right directly to savings. It becomes part of the savings pool of the country. And over time those personal accounts will increase the total savings in the country, which means higher growth rates and higher capital formation for the future.

I'm confident that personal accounts will be part of any ultimate solution to Social Security because it's the only way to do it in a way that's fair to younger people. Let them build a nest egg for the future.

CAVUTO: Secretary Snow, always a pleasure, sir. Thank you very much.

SNOW: Neil, thank you. Good to be back.

CAVUTO: Treasury Secretary John Snow out of Washington.

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