Social Security Anniversary to Renew Reform Debate

Lawmakers and interest groups are gearing up for a fight this fall over Social Security (search), each side hoping to use the retirement and disability program's 70th birthday to build momentum.

President Bush and House Republicans have yet to build a groundswell for shifting a portion of Social Security payroll taxes to individual accounts for younger workers. Whatever returns these investment accounts earn would supplement future benefits.

Bush's proposal for addressing a looming insolvency in the government retirement program by trimming future benefits for high and middle-income earners also has yet to get traction.

Interest groups and lawmakers on all sides are using the program's 70th anniversary Sunday as an occasion to kickstart a debate begun last winter when Bush made Social Security the centerpiece of his State of the Union address. That debate had faded by summer, but House Republicans still hope to vote on some version of the revisions this fall.

One group opposed to the idea of individual investment accounts held birthday baking contests and urged undecided lawmakers "cut the cake, not the benefits." The organization, Americans United to Protect Social Security, also produced a birthday card "wishing for 70 more years of guaranteed benefits."

An electronic card from the opposite side of the debate, circulated by the Coalition for the Modernization and Protection of America's Social Security, or CoMPASS, shows a Social Security birthday cake sliced and served. Without major reform, it warns, children will be left with the crumbs.

Democrats used two radio addresses this weekend to argue that the president's ideas put the dependable program on risky footing. "It has never been a day late or a dollar short," said Rep. John Salazar, D-Colo. "But now, that guaranteed benefit is being threatened by a fabricated crisis and a false solution."

Bush traveled to more than two dozen states this winter and spring promoting his idea for letting younger workers divert a portion of their payroll taxes into individual investment accounts. All the while, wary Republicans in Congress advised their leaders against bringing the issue to a vote.

The White House says Bush will renew his focus in early September after returning from a month of vacation. While he has succeeded in alerting the public about Social Security's problems, polls show that most Americans don't like his solution.

Republicans still vow to produce legislation, but Democrats confidently predict it's too unpopular to pass.

Treasury Secretary John Snow (search) predicted last week that Congress will revamp Social Security this year.

House Republican leaders expect to schedule a vote in September or October. Key lawmakers have introduced a bill that establishes individual investment accounts and deposits current surplus Social Security funds into them. Supporters say it prevents the government from using Social Security money to fund other government programs, but Democrats call it an accounting gimmick that adds billions to the national debt.

"The best way to celebrate Social Security's birthday would be to enact legislation that ensures Americans' hard-earned contributions to Social Security will be dedicated solely to paying Social Security benefits and not used to fund other programs," said Ways and Means Social Security Subcommittee Chairman Jim McCrery, R-La.

House Republicans say a string of GOP legislative successes on trade, highways and bankruptcy bode well for a victory on Social Security.

Any package of retirement changes must first be assembled by the House Ways and Means Committee, but House Democrats have stood fast against any bill that diverts Social Security funds into private investment accounts.

"Social Security has never failed to pay promised benefits, and Democrats will fight to make sure that Republicans do not turn a guaranteed benefit into a guaranteed gamble," said House Minority Leader Nancy Pelosi, D-Calif.

If the GOP succeeds in the House, it faces a steeper challenge in the Senate. After 15 meetings, Republicans on the Senate Finance Committee still can't agree on a plan for improving the program's finances or adding the president's investment accounts. Committee Chairman Charles Grassley, R-Iowa, pledged to try again this fall.

GOP leaders urged senators to hold anniversary rallies and meetings in their states and forcefully tell Democrats to join the debate: "Face the facts and come to the table on reform."

Democrats went home during Congress's August recess with their own message celebrating Social Security's 70-year record of benefits. "Senate Democrats continue to work to strengthen Social Security, not to dismantle it through a risky privatization scheme," said Senate Minority Leader Harry Reid, D-Nev.

The murky outlook has interest groups on both sides expressing some optimism.

"Obviously, it is not a clear path for reform," said Derrick Max, executive director of CoMPASS and another business coalition backing the president's plan. "That being said, I do think we've got some momentum."

Opponents of Bush's plan at the AARP, the giant organization of people over 50, say said they expect to defeat it but aren't ready yet to declare total victory.

"It doesn't seem at this point that there's likely to be legislation moving on to the president," said John Rother, the AARP's director of policy and strategy. "I think our job is mostly done."