Posted on 04/26/2005 8:28:07 AM PDT by KyleM
Some congressional Republicans who have been trying to craft a Social Security reform package say their efforts have been undercut by an unlikely source: conservatives whose top priority is to restructure the program.
As President Bush has struggled to gain traction on Social Security reform, Republicans have repeatedly criticized Democrats for refusing to negotiate on changing the entitlement system.
But some say that Bush should look to his right for scapegoats if Congress does not pass a Social Security bill this year. They blame conservatives for drawing several lines in the sand and refusing to consider compromises.
Conservatives have been outspoken on what should — and should not — be in a Social Security reform measure. Outside groups that are a driving force in the GOP have attacked Republicans for suggesting that raising taxes could be part of reform legislation.
A Senate Republican leadership aide expressed frustration with conservative groups’ rhetoric. While Bush and GOP congressional leaders say they are open to many ideas, conservatives have panned the everything-is-on-the-table approach.
“We should have no conditions before we start talking,” the Senate leadership staffer said. “If you start narrowing the ideas, there’s nothing left to negotiate.”
“There is a splinter in the Republican Party on how this should be addressed,” another Senate Republican aide said.
Rep. Clay Shaw (R-Fla.), a senior Ways and Means Committee member, said he has noticed “some negative stuff coming out” of certain groups, which he declined to name.
“They don’t understand that politics is the art of compromise,” he added.
Shaw’s Social Security reform plan proposes “add-on” accounts instead of “carve-outs” favored by many conservatives. The carve-outs would be financed from diverting payroll taxes, while add-ons would be paid for through tax credits.
“The problem with the far left and the far right,” Shaw said, “is that they have a my-way-or-the-highway approach.”
Shaw, who has been working on Social Security matters for more than six years, said critical comments from conservatives “didn’t start happening until recently. I hope we stop it.”
Without GOP unity, the effort to revamp Social Security will be doomed, Shaw suggested: “If we’re fractured, Democrats will see this as a political opportunity.”
In television commercials that have run in South Carolina, the Club for Growth rebuked Sen. Lindsey Graham (R-S.C.) for seeking to lift the $90,000 Social Security tax cap and Americans for Tax Reform (ATR) sent a letter to Congress rebutting Graham’s skepticism about Bush’s insistence on personal accounts.
The groups did not hold back. The Club’s ad said Graham’s idea of “a huge tax hike” is a “really bad idea” that “would hit millions of families, wipe out much of the Bush tax cut and punish small businesses.”
In his letter to Capitol Hill, ATR President Grover Norquist said, “Sen. Graham’s comments are a recipe for destroying the second term of the Bush administration and if acted upon will squander the opportunity for at least another generation to preserve and modernize Social Security.”
Conservatives have embraced a reform plan introduced by Rep. Paul Ryan (R-Wis.) and Sen. John Sununu (R-N.H.) while making it clear that they will be wary of any plan that strays from that bill.
In contrast, Ryan has said he is open to negotiating on changing Social Security.
Even though Bush has put Social Security on Congress’s plate, the White House has also been the target of ire from the right.
In a memo to White House Deputy Chief of Staff Karl Rove, Cato Institute President Ed Crane said, “[Bush] has been heroically bold in raising [Social Security reform]. But it seems to me that he’s been timid in the manner in which he has chosen to promote it.” Excerpts of the memo were reprinted in The Wall Street Journal last week.
Peter Ferrara, a senior fellow at the Institute for Policy Innovation (IPI) who is credited as the author of the Ryan-Sununu bill, wrote an op-ed in The Washington Times two months ago that mocked the White House for trying to send the president out to sell personal accounts with a message that they don’t really solve the problem. Ferrara wrote, “Is it any wonder then that the more George W. Bush talks about personal accounts the lower they sink in the polls?”
Ferrara told The Hill he is trying to help Republicans get on track on Social Security. He accused top Bush administration officials — including Rove and White House Chief of Staff Andy Card — of urging people to tell him to “shut the hell up.” Ferrara, who is scheduled to testify on Social Security before the Senate Finance Committee today, said Rove, Card and Office of Management and Budget (OMB) Director Josh Bolten lack expertise on the entitlement system and mistakenly believe some Democrats are close to embracing the president’s plan.
“Rove thinks he’s been beatified by the last election,” Ferrara added.
The White House declined to respond to Ferrara’s comments. Spokespeople for the Department of the Treasury and the OMB said the administration is open to input from all groups on Social Security reform.
The IPI has also gone after Graham and Senate Finance Committee Chairman Chuck Grassley (R-Iowa). In a strongly worded release, IPI President Tom Giovanetti said, “The movement to fix Social Security through personal retirement accounts is in serious trouble when some Republican leaders demonstrate utter ignorance about how they work.”
The IPI’s comments came in the wake of doubts expressed by Graham and Grassley about personal accounts.
“Perhaps we need new people leading the cause of personal retirement accounts,” Giovanetti said. “Graham and Grassley just don’t get it.”
Ferrara defended the IPI’s statements: “All we are doing is telling the truth.”
Both senators are proponents of personal accounts but are concerned that insisting on the accounts could imperil Social Security reform this year.
Some conservative groups believe that could be a good thing — even though such a scenario would be regarded as a huge political setback for Bush.
The Free Enterprise Fund, which has championed personal accounts, suggested that no action on Social Security would be better than moving a reform bill without personal accounts: “If Republicans move ahead on Social Security with no personal accounts, or accounts so small as to be financially inconsequential to voters, then it is the GOP that may win the battle but lose the war. … Social Security reform without personal accounts will lead to a political Waterloo for Republicans and could jeopardize the GOP’s majorities in the House and Senate in 2006.”
Norquist contends that Social Security reform may not happen this year but will be passed eventually. However, Grassley last month told The Hill that Social Security reform must happen in 2005 — or it won’t for the next eight or nine years.
In an interview with The Washington Post, Grassley likened a vote on Social Security reform to “walk[ing] the plank.”
Certainly, a sizeable number of Republicans — such as Reps. Jo Ann Emerson (Mo.) and Rob Simmons (Conn.) — are wary of reshaping the Social Security system with private accounts. The notion that Social Security will return as a top issue in the next Congress is debatable and may largely depend how it plays out in the 2006 election.
Senate Majority Whip Rick Santorum (R-Pa.), who is admired by conservatives, has also conveyed disappointment with groups representing the right. An irked Santorum earlier this month responded to conservative commentary written by Free Enterprise Fund’s Stephen Moore and IPI’s Ferrara on National Review Online (NRO).
After Moore and Ferrara blasted Senate Republicans for allegedly selling out on Social Security, Santorum responded with his own NRO commentary: “If [Moore and Ferrara] had asked me what Senate Republicans were up to instead of quoting a report by the Associated Press, perhaps there would be no need to set the record straight. Again.”
Political observers believe that the hard line conservatives have taken is a shrewd negotiating maneuver.
“It’s all part of the legislative process,” a House GOP leadership aide said. “I do think in the end [the conservative groups] will jump on board.”
Rep. Jim McCrery (R-La.), chair of the Ways and Means subcommittee on Social Security, said he is not bothered by critics on the right. He added that he has urged his colleagues not to draw lines in the sand.
But others say conservatives are overplaying their hand.
“They don’t have near the votes [to pass the Ryan-Sununu bill],” the Senate Republican staffer said.
The Ryan legislation has been praised by House Speaker Dennis Hastert (R-Ill.), Majority Leader Tom DeLay (R-Texas) and the Republican Study Committee, a group of over 100 House conservatives.
That group has told top Bush administration officials that it will strongly back a Social Security bill with personal accounts. It has also warned that it will vehemently oppose any legislation that raises taxes or lacks carve-out accounts.
Conservative lawmakers are still bitter about being pressured to vote for the prescription-drug bill that deteriorated the financial future of Medicare. That experience has emboldened them to get a Social Security bill to their liking.
The bickering among Republicans on Social Security over the past several months is a clear indication that GOP leaders will have to worry about votes from conservatives when they are already struggling to attract support from centrists.
Right-wing groups have been pushing for Social Security reform for years. Now that it’s Bush’s top domestic priority, they are not eager to strike deals with Democrats.
Ultimately, Republicans say, it is up to the White House to settle the GOP’s deep divisions on Social Security.
“The president has to give us more guidance,” the Senate Republican staffer said.
Those people won't be laughing when you're buying their land for pennies of the dollar because they all defaulted on loans, like in the Great Depression. Regardless of what many believe, the stock market IS a gamble, just read the disclosures on every prospectus. But then, you already knew that....;)
It's simplistic to think you'd maintain the same investment ratio of stocks to bonds when you're 74 as you did when you were 20. As you get older, you would be adjusting your stocks/bond ratio towards more bonds (more stable investment, lower yields). The day you retire you could buy an annuity with your savings and then you would KNOW how much you would be getting every month.
Check out some of the 529-plan offerings from Fidelity or Vanguard (I'm sure there are others) which have investment ratios based on the age of the beneficiary. My 11 month-old son's account is invest more heavily in stocks than my 13 year-old stepdaughter's account. It's done automatically for us, we just chose the option and sent them our money. It's reasonable to assume that similar types of funds would be available for retirement accounts.
We figured that out from your posts lauding the social security program.
The bottom line is that the stock market is inherently too volatile to tie to pensions at any point.
That is why any investment plan should include a diversified portfolio rather than investing in one particular stock. A retirement investment plan that does not include any investment in diversified portfolio equity funds is unlikely to provide returns that will do anything more than keeping up with inflation.
And that perhaps, is the greatest flaw in the President's plan as the average American understands this.
The average American doesn't understand squat, but demogogues anxious to preserve the status quo are ready to provide plenty of misinformation and you are swallowing it hook, line, and sinker. Social security is a loser of a retirement program. If you are relying on SS to take care of you I hope you have wealthy (and generous and compassionate) children who will be willing and able to take care of you. Otherwise, that is just more of my tax money that will be required to support people who were unwilling to do anything to provide for themselves and their families.
WASHINGTON — As he nears the end of a 60-day cross-country campaign, President Bush appears to be further from achieving his signature goal of transforming Social Security than when he began.
Support for Bush's vision of individual investment accounts has ebbed; a USA TODAY/CNN/Gallup Poll taken this month shows nearly twice as many Americans oppose the idea as support it. The public's sense of urgency on Social Security has slipped a bit. Not a single Senate Democrat has come out in support of Bush's plan.
And Republicans are divided. Senate Finance Chairman Chuck Grassley of Iowa, who convenes hearings on Social Security on Tuesday, is open to putting individual accounts aside and focusing on the system's long-term solvency. But some conservatives, including Reps. Mike Pence of Indiana and John Shadegg of Arizona, members of the House leadership, want a showdown on accounts.....
We have supported them with our time and money, then they stab us in the back when they sip the Beltway Water.
You reek of troll because of this statement:
"However, my SS benefit had actually gone UP a bit as my earnings had increased during the same period."
If you think that Social Security receipts should stay in the government trough to be fed on by the hordes of pork barrel politicians, instead of the stock market, that is the height of foolishness. If you choose the former over the latter, you are just the kind of sucker the Rats want.
I might prefer to just have the money outright, but Rats are playing divide-and-conquer, and I'll take the incremental change of the President's proposal over the all-or-nothing NOTHING we'll get trying to get Social Security ended. And I sure won't back add-ons, which are just government controlled 401Ks.
Rule #1: NEVER trust a poll
Senate Finance Chairman Chuck Grassley of Iowa...is open to putting individual accounts aside and focusing on the system's long-term solvency...
Rule #2: Not okay. This is what the demonRATS said from the first day. NO COMPROMISE! Both can be accomplished. If you are not up to the task, then resign.
But some conservatives, including Reps. Mike Pence of Indiana and John Shadegg of Arizona, members of the House leadership, want a showdown on accounts.....
Rule #3: Support those that have a backbone! Go Pence!
ROTFLOL...you are kidding...right????? Unless you are about 64 that is the funniest thing I've seen or heard all day.
Sorry, I just couldn't let this one go by.
I know Rove, and I know Ferrara.
Have to go with Ferrara on this one...
Mike Pence is leading the fight against add-ons. Mike Pence stands on principle and not party. We need Mike Pence as our president in 2008!
Leadership Shake-Up Spurred Policy Shift: Pence Hangs Tough !!!!
http://www.washingtonpost.com/wp-dyn/content/article/2005/10/16/AR2005101601055_pf.html
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