WASHINGTON — “The White House may not know it, but Social
Security reform, at least the kind that they want to do, is DOA,”
says a House Ways and Means staffer. “We’re taking it out of their
hands and going to make the best of a bad situation.”
For weeks now, ask any White House staffer involved in the
Social Security debate, and they will tell you that things are
still on track for the President’s framework of a reform bill,
including personal savings accounts. But in both the House and the
Senate, Republican leaders and their caucuses don’t see how they
can pull it off in the current political climate.
“It’s not that the Democrats have done anything particularly
savvy or strategic to make this fight difficult. They are not the
reason reform has fallen flat,” says a Senate Finance Committee
staffer. “The White House just hasn’t done a good enough job
messaging this thing. There has never been a consistent, say,
ten-day period of time where it was Social Security reform or
retirement enhancement all day, all the time, in terms of
messaging. You’d have the President out there talking about it one
day, then talking about three other areas of concern the next two
days. The fact is, the media is incapable of covering an issue like
this unless you put a ring in its nose and pull it along. There has
to be focus, focus, focus.”
House Republicans would prefer to make some headway on other
taxation and healthcare issues before the August recess. In the
Senate, which has been embroiled in judicial warfare, the
nomination of John Bolton as ambassador to the U.N., and
appropriations battles, there is little appetite to take up the
White House plan now or the near future.
Both Senate Finance Committee Chairman Charles
Grassley and House Ways and Means Committee Chairman
Bill Thomas and their committee staffs have been
working on some form of Social Security reform, but neither is
looking to take things as far as the White House wants. Both
proposals do include reforms the Bush Administration has embraced
or at least indicated it might support, including reduction of
future benefits for all but the poor, raising the retirement age
for full benefits, and not raising payroll taxes.
But neither chairman believes after months of discussions,
debates, and back room arm-twisting that they can muster the votes
for personal accounts, even at the small level the White House has
been pressing. Nor do they believe that they can meet the reform
goal set by President Bush to put the program on a path to full
solvency.
ONE WILD CARD IN THE SOCIAL SECURITY reform debate is South
Carolina Senator Jim DeMint, who is quietly
mounting his own reform proposal, which is based on what he has
been working on from the time he was in the House. DeMint is known
to have been meeting with outside Republican groups to generate
some grassroots support for a bill he will probably introduce this
week. He has indicated privately that he believes from private
conversations he has had with Democrats that he will garner some
Democratic support.
DeMint’s plan would feature hallmarks of the Bush framework, but
would use the Social Security surplus to establish private
accounts, while not cutting benefits or raising taxes to deal with
the system’s funding shortage.
Hill sources say drafts of the legislation have included a
feature of the reform proposal DeMint touted in the House: allowing
people age 55 and under to set aside between 3 percent and 8
percent of their Social Security taxes, depending upon income
levels, into individual accounts. These accounts would ensure “full
benefits” to participants after retirement, with a mix of
individual account and traditional Social Security account monthly
payouts.
“DeMint’s plan is interesting because he keeps the individual
account contributions in the Social Security system,” says a
conservative activist, who has met with DeMint. “All of that money
is growing at market rates, while also keeping the system solvent.
If there is a plan that can jump-start this thing again, it’s
DeMint’s.”
But leadership staff on both sides of the Capitol are dubious
that any plan with individual accounts can survive. They say the
best hope for individual account supporters is a plan with a small,
pilot-program-type individual account component coming out of
either the House or the Senate that might survive in conference.
Given Senator Grassley’s ambivalence about individual accounts, the
proposal would almost certainly have to come out of Ways and Means
in the House.
