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President Tells His Friends Why Social Security
Needs Reform, Now
Aug. 4, 2005 President Bush, obviously relaxed
speaking among friends yesterday in Grapevine, Texas to the American
Legislative Exchange Council, gave his personal views of the Social
Security program and why the projected shortfalls in future years need
to be addressed now. He also continued to push for personal savings
accounts. All though there was nothing new, the presentation stands out
for being more of an open discussion than the prepared speeches laced
with bullet points - he most often gives on the subject.
Below is the portion of his talk released by the
White House that was about Social Security.
Congress needs to continue debating Social
Security. Let me tell you about what I think my job description is. I
think my job is to confront problems, not pass them on to future
Presidents and future Congresses. (Applause.) I know that's what the
American people expect of their leaders. And I see a problem in Social
Security. I'm part of the problem -- I'm fixing to retire. (Laughter.)
Matter of fact, my retirement age is in 2008; that's when I'm eligible
for Social Security. It's a convenient year. (Laughter.) And I'm not the
only one. There's a lot of us who are eligible to retire. We're called
the baby boomers. There's about 40 million people today receiving Social
Security. By the time the baby boomers like me get completely retired,
there will be about 75 million. In other words, a lot -- there's a lot
of us. And we're living longer than previous generations. Matter of
fact, I think I'm going to ride the old mountain bike this afternoon in
Crawford to make sure I live longer. (Laughter.) If I can survive the
heat.
We've been promised greater benefits than the
previous generation. People went around the country saying, vote for me,
I'll increase your Social Security benefits. And sure enough, that's one
of the promises that Congress kept. You got a lot of people living
longer, getting greater benefits, with fewer people paying in the
system. In the early '50s, there was about 16 workers to every
beneficiary. Today, there's 3.3 workers for every beneficiary. Soon
there's going to be two workers for every beneficiary. If you look at
the cash flow analysis, you'll find that the system goes red in 2017.
And by the way, it is a pay-as-you-go system. Some
people think it's a trust fund. The trust fund concept means we take
your money, we hold it and we give it back to you. No, this isn't the
way it is. It is a pay-as-you-go -- you pay, we go ahead and spend.
(Laughter.) You pay, we pay -- you pay your payroll taxes, and we go
ahead and pay for the benefits. And with money left over, we fund
federal programs. And all that's left is a file cabinet full of IOUs.
Somebody told me that, and I went to West Virginia to see it for myself
and, sure enough, it's still there -- paper, promises. No, the system in
2017, goes in the red. In 2042, it's bankrupt.
So my first question to members of Congress is,
how can you go back to your districts, when you look at the facts, and
stand up in front of young workers and look them in the eye and say,
man, the future is bright for you, knowing full well somebody is going
to be paying payroll taxes into the system that's going broke? I
certainly can't do that. And that's why I stood up in front of the
Congress and said, we've got a problem, let's work together to fix it --
and have gone around the country describing to the people the nature of
the problem. The system is going broke is what is the problem.
Secondly, I've done something most Presidents
haven't done and that is put out some solutions. First of all, if you
were born prior to 1950, nothing is going to change for you, and that's
important for those of you who are interested in the subject to remind
your mothers and fathers, or some of the elderly in your districts.
Nothing changes. I understand older people don't like change, and
therefore, when they hear, Social Security reform, it makes them
nervous. As a matter of fact, some folks who don't want to see any
Social Security reform at all have used that leverage -- they go into
people's districts and say, George W. is going to take your check away.
It's not going to happen. There's plenty of money for the senior
citizens.
It's the younger workers who are coming up who
better be paying attention to this issue. It's the younger folks who are
coming up who are going to have to pay for people like me who are going
to live longer and get more benefits than the previous generation. And
so I said, why don't we go ahead and come up with a system that says
you're going to get your benefits if you're a poor person based upon
wage increases, and if you're a wealthy person, you get your benefits
that increase based upon the cost of living increases, and you scale it
in between? And that solution -- that solution, or that suggestion
nearly solves all of the permanency problems in Social Security.
Listen, if you're a younger -- somebody told me
about a survey about the younger folks said they're more likely to see a
UFO than a Social Security check. (Laughter.) Well, if you believe that,
it seems like it makes sense to have a system that if you're doing all
right, it increases your benefits based upon cost of living. That means
you're going to get a check, and it's going to be at least increasing at
the rate of cost of living.
We've got a lot of politics in Washington these
days, though. People don't want to discuss the idea. It's kind of
zero-sum up there when it comes to big issues. By the way, as we're
talking about how to make the system permanently fixed, seems like to me
now is the time to make sure it turns out to be a better deal for
younger workers, too. I strongly believe that younger workers ought to
be allowed to take some of their own money and put it in a personal
savings account, so they can watch their money grow at a rate greater
than that which the government can grow their money, a personal account
they call their own, a personal account the government cannot spend, a
personal account they can pass on to whomever they want. (Applause.)
We believe in ownership. We understand that the
more people that own their home, or own their own business, or own and
manage their own health care account, or own and manage their own
retirement account, the more people that do that the better off America
is. If you own something, you have a vital stake in the future of this
country. Now is the time to permanently fix Social Security, and now is
the time to trust people with their own money, to give people a chance
to build an asset base they call their own. (Applause.)
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