Dem. congressman offers 1st Soc. Sec. fix (FL-Wexler,, says raise taxes)

Monterey Herald ^ | 5/13/05 | Glen Johnosn - AP

[NormsRevenge]

WASHINGTON - Breaking with party leaders, a Democratic congressman plans to introduce Social Security legislation, saying his first commitment is to his constituents.

Rep. Robert Wexler, D-Fla., said Friday: "I have the largest amount of Social Security recipients of any Democrat anywhere in the country. My allegiance to seniors is greater than my allegiance to the Democratic Party."

While Wexler is proposing tax increases that would clash with President Bush's pledge not to expand the existing payroll tax, his legislation was heralded by the White House in part because Democrats had steadfastly refused to offer an alternative to Bush's plan. The president's proposal calls for creating private investment accounts and a new method for calculating future benefit growth.

Democrats have refused to put an alternative on the table until Bush drops his insistence on private accounts, which they say would destroy the Depression-era system by depriving it of critical funding.

"I would be surprised if the president were anything but pleased there is another voice with the courage to stand up and put a proposal on the table," said White House spokesman Trent Duffy. "Obviously we haven't seen the specifics on this plan, but I think the president welcomes anyone who wants to work in a good-faith effort to solve the serious challenges facing Social Security."

Wexler's bill calls for a 6 percent tax on all income above the current $90,000 cap. Three percent would be paid by workers and 3 percent paid by their employer.

At the same time, the bill would reinstitute "pay-go" rules for federal budgeting, requiring that any tax cuts or increase in entitlement spending be paid for either by raising taxes or cutting spending elsewhere. The requirement expired at the end of 2002.

Wexler's proposal, which he will unveil in Florida on Monday, would not require any cut in scheduled benefits or increase in the retirement age, and it does not provide for private accounts.

"The president's approach cuts benefits and it creates a privatization scheme, and on top of that does not ensure the solvency of Social Security," said Wexler, whose district includes the largest number of Social Security beneficiaries of any Democrat in the country.

The congressman said his bill, which has been reviewed by the Congressional Budget Office, would achieve solvency by eliminating the $2.1 billion program shortfall estimated by the nonpartisan agency. Social Security's trustees have pegged the figured at $3.9 billion.

"The president traveled the country for the past two months and effectively challenged the Democrats to make their own plan," Wexler said. "Today, that challenge is responded to."

House Minority Leader Nancy Pelosi, D-Calif., recently quashed a meeting in which some of her fellow Democrats were set to discuss Social Security with the head of the AARP and a group of Republicans.

Wexler said he had twice spoken with Pelosi about his plan. While he would not reveal her reaction, he said, "It would be wrong to assume it was a receptive conversation."

Jennifer Crider, a Pelosi spokeswoman, said: "There are Democrats with a lot of different ideas. This is one member's take, but it is not the Democratic plan."

[Brilliant]

To give you an idea of how hokey the trust fund is, consider this: We could fix the problem even better than Wexler proposes for absolutely free, just with an accounting entry. We don't need to increase taxes. Just have Congress double the amount of the IOU that we already have in the trust fund. You don't need to increase taxes to do that.

And the reason that would be better than what Wexler proposes is that taxes would be lower after we're done, and we would then be in a better position to pay off the IOU when the time comes.