But not because any silver hairs voted for him. Bush can hammer all he wants, maybe it will get through, but he will not change the political leaning of the AARP and they will send out a mailing to counter everything Bush says. And one mailing from someone they trust will outdo all the media Bush can buy.
And of course any money Bush pulls from the system and puts in the retirees personal accounts will require back up funding or program cutting. Both ideas are tough calls. If the programs are cut, then old timers can well believe that they will lose somewhere even if their SS check comes on time. Maybe what will be cut will be seniors bus passes for example. As far as back up funding, the best idea I have heard is to take out a loan to cover the lost funds. And retire the loan over the same length of time that the retirees are saving in their own accounts. At some time the government can stop mailing SS checks and let retirees withdraw from their own savings. (The ultimate plan anyway.) An at this time the government can switch SS check payouts to retire the notes that funded the program in the first place.
What it sounds like you're saying is that the seniors aren't all that far off-base in perceiving a risk to their payments. Regardless of how true that perception is, they can not deny that the risk to them will not be greater if younger people are allowed to do with their own money as they wish, instead of being required to invest it in a government-approved index. Its effect, or non-effect, on the seniors is exactly the same either way, so there's no greater political liability in letting the younger set keep the 4% themselves and do whatever they judge best with it.
These so called prefunding or transition costs will require some borrowing to cover the reduced revenue coming in from SS, which is a pay as you go system. However, it also reduces our future liabilities. Borrowing less now, saves us from borrowing more in the future. Estimates vary widely on how much will be required.
Personal accounts will carve out 4% from the total of 12.4% OASDI. The USG will have to come up with difference to cover the loss of revenue. However, personal accounts will decrease the USG's long-term liability for the remaining defined benefits portion of the program. The individual should actually do better with the combined benefits, PA and SS, than those promised currently under the system. It is a win-win solution.
As far as back up funding, the best idea I have heard is to take out a loan to cover the lost funds. And retire the loan over the same length of time that the retirees are saving in their own accounts.
If you mean by taking out a loan, adding to the publicly held debt, that is what we would have to do unless we want to cut back on discretionary spending, which includes defense. The Dems and AARP have been putting out the phony story that the Bush plan includes having individuals pay back part of the money from their PAs to cover transition costs. This is bogus nonsense. Just some scare tactics to confuse and frighten people.