WASHINGTON – Concerned the Social Security (search) debate has become mired in the conflict over private investment accounts, some Senate Republicans want President Bush to switch his focus to the retirement program's looming insolvency and how to fix it.
"The more you talk about solvency, the harder it is for Democrats to object to everything," said Sen. Lindsey Graham of South Carolina, who has been trying to broker compromise legislation between the parties.
Sen. Charles Grassley (search) of Iowa, who heads the Senate committee with jurisdiction over any legislation, said not just the president but rank-and-file Republicans have a responsibility to switch the focus.
"I don't know to what extent I should put this on the back of the president," Grassley said Tuesday. "I think that we have not pushed enough discussion of the solvency, and the reason I say that is, when you get right down to it, that's a no-brainer. You lay every fact about Social Security out about its insolvency and you're not going to have Democrats and Republicans disagree. They might disagree when to do something about it, or how to solve that red ink, but we need to be concentrating on that."
White House officials have said that the president is not only committed to the accounts proposal but also a 60-day, 60-city administration tour under way to promote the need for a Social Security overhaul. Despite Graham and Grassley's concerns, Bush already addresses the solvency issue on the stump as a prelude to making a more in-depth case for the personal accounts.
However, both sides in the debate over private accounts agree they don't fix the solvency problem.
"President Bush believes we have a responsibility to our children and grandchildren to permanently fix Social Security, a goal that Democrats and Republicans should have in common," said Dan Bartlett, senior counselor to the president. "He will also continue to make the case that personal retirement accounts plays an integral part of any reform effort by giving younger Americans an opportunity to control their own retirement."
Social Security takes in more in payroll taxes than it dispenses in benefits to about 47 million retirees, but that trend is projected to end in 2017 amid the retirement of the baby boom generation. By 2041, the system will have exhausted a trust fund built up to continue paying full retiree benefits. Then, according to program analysts, payroll taxes (search) will be able to cover only about 72 percent of promised benefits.
While many Democrats argue that the system can be extended with minor changes that may include tax increases and benefit cuts, most Republicans warn that the situation is more dire. They note that in 2008, the growth in contributions to the trust fund will peak. That could trigger draconian budget cuts because the government has been borrowing excess Social Security tax payments to pay for other government programs. If that tax money starts to diminish, it would leave less free cash for other domestic and foreign spending.
Under Bush's account proposal, younger workers could invest income equivalent to 4 percentage points of their payroll tax. The administration argues that would cushion the blow of any future benefit cuts by allowing the workers to take advantage of compounding interest and market forces.
Democrats, however, have been united in opposing the proposal. They say the president wants to starve the program of needed payroll taxes, while shifting from a retirement benefit guaranteed by the government to a self-funded account subject to stock market cycles. They have urged Bush to focus on solvency.
Graham suggested Bush may change his focus during a presidential visit to South Carolina next week.
"The more specific he becomes, the more heat he takes but the more pressure on the body to answer specific plans," the senator said. "A date certain for a vote would be the best thing that could happen. There are a lot of senators and congressmen who are hoping that this thing goes away."
Grassley also said he expected a change in focus, based on a conversation he had with the president when he visited Iowa last month.
"The president is going to talk more about solvency, I'm convinced of that, after being with him in Cedar Rapids," said the senator, chairman of the Senate Finance Committee.
The White House would not confirm the speculation.
"The legislative process is just beginning and the American people expect their elected leaders to bring ideas to the table, not simply oppose reform for partisan political purposes," Bartlett said.