Less for the Rich, More for the Poor

At his Thursday night press conference, President Bush said the nation has a responsibility to reform Social Security -- "by directing extra help to those most in need and by making it a better deal for young workers."

He stressed three goals: (1) Future generations must receive benefits that are equal to or greater than the benefits seniors are getting today; (2) the system "should protect those who depend on Social Security the most"; and (3) any reform plan must provide younger workers with "real assets, real money" -- personal accounts, in other words.

President Bush did not give details about his more-for-the-needy plan, but the White House later said the plan is modeled after one proposed by a Boston investment manager.

Sliding scale

Robert Pozen, chairman of MFS Investment Management, told the Boston Globe that his plan would leave Social Security benefits intact for people earning an average of $25,000 a year over their entire working careers.

Based on a "sliding scale," benefits would be progressively less for higher earners. Pozen told the Globe that people earning an average of $113,000 a year over their working careers would see the deepest cut in Social Security retirement benefits.

"By providing more generous benefits for low-income retirees, we'll make this commitment: If you work hard and pay into Social Security your entire life, you will not retire in poverty," President Bush said Thursday night.

At the same time, the president said younger workers must have the option of investing some of their payroll taxes in "voluntary personal retirement accounts."

President Bush said he knows some Americans are concerned about stock market fluctuations -- "so I propose that one investment option consist entirely of treasury bonds, which are backed by the full faith and credit of the United States government.

"Options like this will make voluntary personal retirement accounts a safer investment that will allow an American to build a nest egg that he or she can pass on to whomever he or she chooses," he said.

Politics

The president expressed eagerness to work with both the House and Senate "as they take the next steps in the legislative process." He said he's willing to listen to good ideas from either party, but so far, the only response is "no."

In a statement released after President Bush's speech, Democrats rejected his call for bipartisanship:

"All the president did tonight was confirm that he will pay for his risky privatization scheme by cutting the benefits of middle-class seniors," Senate Minority Leader Harry Reid and House Minority Leader Nancy Pelosi said in a joint statement.

"'President Bush cannot escape the fact that privatization will weaken Social Security at a time we should be strengthening it."

President Bush apparently anticipated such a response.

In his Thursday night remarks, he said, "Too often the temptation in Washington is to look at a major issue only in terms of whether it gives one political party an advantage over the other. Social Security is too important for politics as usual.

"We have a shared responsibility to fix Social Security and make the system better, to keep seniors out of poverty and expand ownership for people of every background."

Obstructionism

Republican National Committee Chairman Ken Mehlman issued a statement Thursday night, telling Democrats the time for "obstructionism" is over.

"Progressive indexing will make Social Security a better deal for all Americans, and it is now time for Democrats to propose their own strategies if they disagree with President Bush's common sense ideas. It's no longer acceptable for Democrats to play politics with the retirements of American workers by refusing to show up at the negotiating table," Mehlman said.

House Speaker Dennis Hastert (R-Ill.) said President Bush is "showing strong leadership" by tackling a problem that Democrats can use against him.

"Our country is getting older," Hastert said. "And the reality is, in a pay-as-you-go system like Social Security, we just don't have enough people in the workforce to sustain the current benefit structure."

Hastert said he's committed to working with President Bush and the Senate to make Social Security a "financially sound program" for future generations.

"It amazes me that Leader Pelosi and the Democrats continue to criticize the President's proposals when they've offered no plan or ideas of their own.

Just yesterday, Hastert noted, Pelosi refused to let members of her party attend a bipartisan meeting with Republicans and the AARP to discuss reforming Social Security.

"The last time I checked, partisan games and rhetoric won't save Social Security and it won't secure the future for our children and grandchildren," Hastert said