House GOP to draft Social Security bill

WASHINGTON -- House Republicans injected new urgency Friday into their drive to overhaul Social Security, unveiling plans to draft legislation in June and brushing aside Democratic claims they intend to cut benefits for middle-class retirees.

"I'm confident we're going to get something done," said President Bush, struggling to build support for the centerpiece of his second-term domestic agenda.

After months of little evident progress on the issue, House Republicans said they intended to have legislation before the Ways and Means Committee by June. "It won't just be a Social Security bill. It will be a retirement bill," said Rep. Bill Thomas, the chairman.

Apart from changes in Social Security itself, the California Republican spoke vaguely of steps to encourage private retirement savings. He indicated he may attach provisions to ease the financial burden of long term or chronic care for the elderly.

He spoke in guarded terms about Bush's call for personal accounts for younger workers. "I believe you can construct a personal savings account that could be one component of many that address solvency," he said.

"House Republicans are ready to roll up their sleeves and do some hard work on Social Security. We look forward to searching for solutions so that younger workers aren't left with an empty promise from the government," said Speaker Dennis Hastert, R-Ill.

Controversial solutions

Official Social Security estimates predict that annual benefit costs will begin to exceed payroll tax income beginning in 2017, and the trust fund will be depleted in 2041. At that point, the government would be obliged to cut benefits for all recipients.

Bush favors personal accounts for younger workers as well as curbs on benefits for medium and upper wage earners who have yet to retire. Both are intensely controversial, and Hastert has wanted to let the Senate act first on Social Security legislation. His statement gave no indication he has changed his mind.

The Senate Finance Committee is expected to consider legislation by the end of July.

Thomas made his comments on the day after Bush indicated support for tilting the current Social Security system to make it more favorable to lower-income retirees by permitting benefits for future lower-income retirees to rise in accordance with current law, while growing more slowly for middle and upper income people.

A White House fact sheet issued during Bush's news conference Thursday night referred to an approach authored by Robert C. Pozen, a private economist. In testimony before Congress earlier this week, Pozen said a plan along the lines that he advocates could erase roughly 70 percent of Social Security's long-term deficit.

While avoiding all talk of details, Bush renewed his support for that approach in an appearance in suburban Falls Church, Va., during the day.

"I know that we ought to be able to say in a new system, as we fix the safety net for future generations, that you must receive benefits equal to or greater than the benefits enjoyed by today's seniors," he said.

At the same time, he added that one way to assure the long-term solvency of the program was to "have the benefits for low-income workers in a future system grow faster than benefits for those who are better off."

Democrats charged Bush with obscuring the true nature of the plan, and said he favored benefit cuts by another name.

"What he didn't mention is that there are also very significant benefit cuts for the middle class," said Sen. Charles Schumer, D-N.Y. "For most people, it would be better doing nothing than doing the president's plan."

"Democrats believe that slashing Social Security benefits to pay for privatization is the problem, while Republicans believe massive benefit cuts are the answer," said Rep. Nancy Pelosi of California, the party's leader in the House.

"Benefits would be cut for all workers whose annual earnings are more than $20,000 a year," Democrats on the House Ways and Means Committee estimated.

Democrats have said they are willing to work on bipartisan solvency legislation as soon as Bush drops his call for personal accounts. So far, their position has reaped political benefits, with polls showing decreasing support for diverting payroll taxes into individual accounts.

For his part, Thomas rejected a question of whether some Republicans would find it difficult to vote for the type of Social Security bill he has in mind.

"It won't just be a Social Security bill. It will be a retirement bill," he said. He added his hope is to "provide a package in which people see something they can support."