GOP Social Security plan softens Bush's approach
WASHINGTON -- Blending conservative principles with political caution, key Republicans rallied Wednesday behind a plan to introduce Social Security personal accounts on a more modest scale than President Bush favors.
"Our bill is the first bite at a bigger reform," Texas Rep. Sam Johnson said at a news conference. Several Republicans said the proposal may be brought to the House floor next month, possibly as part of a broader measure making changes in pensions and other retirement issues.
Republicans said that under the proposal, for an initial three-year period, surplus Social Security funds would be used to establish individual accounts for willing younger workers. The money would be in the form of "marketable Treasury bonds," according to a written description, with the interest rate set by the government.
Unlike current law, according to Rep. Jim McCrery, R-La., the effect would be to create a financial obligation to individual workers by name. He contrasted that to the current arrangement, which he described as the government promising, "We're going to pay you these [Social Security] benefits and we're going to get them from somewhere."
The GOP approach "effectively seals that money off for Social Security and just Social Security," he said.
Officials said that for the initial three-year period at least, the Treasury would continue to make use of the surplus Social Security funds to pay for other programs -- just as it has for years.
The legislation will establish an advisory board to recommend changes to Congress to take effect after three years, officials said.
Democrats argued that Republicans were making only a cosmetic change in Bush's proposal. "One approach would create risky private accounts directly from a worker's paycheck, and the other would finance risky private accounts from Social Security payroll taxes when they reached the federal Treasury," said House Democratic leader Nancy Pelosi of California.
She said Democrats "stand ready to begin bipartisan discussions on protecting Social Security solvency, but this cannot begin until Republicans begin talking about ways to make Social Security stronger, not weaker."
The White House did not comment directly on the House Republicans' proposal but supported any attempt to advance the debate.
"The president believes his approach is the way we should proceed," spokesman Scott McClellan said at this daily briefing. "But he welcomes all those who are coming forward with ideas and putting ideas on the table."