GOP signals fresh effort on Social Security

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Trying to dispel any perception that Republicans have given up on their effort to remake Social Security, Senate Majority Leader Bill Frist pledged on the Senate floor Thursday that he and his party will seek to pass legislation this year to redesign the retirement system.

“We will do it this year — this year — and not next year,” Frist declared.

While not offering any specific proposals for legislation, Frist said, "all ideas should be on the table" and added, "It is too early for people to be drawing rigid lines in the sand."

He pledged that “retirees and near-retirees will see no benefit changes.”

Frist’s comments were a sharp contrast in tone and substance to the somewhat more pessimistic assessment he offered only two days ago.

Marked change in tone
“The opposition is very well organized” he said Tuesday, adding that it was too early to say whether he’d bring a bill to the Senate in “a week, a month, six months, or a year.”

Frist was emphatic in his Senate speech Thursday that "we should act this year and not put it off to the future."

Despite discouraging poll numbers this week showing dwindling support for Bush's concept of private accounts for younger workers, Frist and Bush administration officials are signaling their determination that they will push for passage of historic re-design of Social Security this year.

Bush has been on campaign-style treks across the nation to generate support for his core idea: allowing younger workers to put some of the Social Security taxes they now pay into personal retirement accounts which would then be invested in mutual fund-style portfolios of stocks, bonds and other assets.

Daunting poll data
A poll released Wednesday by the Pew Research Center for the People & the Press found 46 percent of those interviewed said they supported the idea to allow younger workers to invest part of their Social Security taxes in stocks and bonds — down from 54 percent who supported that idea in December.

Only three in 10 said they approved of Bush’s handling of Social Security.

The Pew survey, conducted Feb. 16-21 among 1,502 Americans, found a sharp generational split on the issue: two-thirds of people under 30 support the concept of private accounts within Social Security, while only 25 percent of those over age 65 favor that idea.

The survey also found that 67 percent of those interviewed think that the Social Security program will run short of money in the future.

A CNN-USA Today-Gallup found a drop in Bush's approval on Social Security to 35 percent from 43 percent three weeks ago.

The president plans visits to New Jersey and Indiana on Friday to tout Social Security re-design.

Snow: Bush to launch 2-month ‘blitz’
Treasury Secretary John Snow said Wednesday the administration was launching a “60-day, 60-stop blitz” of the country to raise the profile of Bush’s signature second-term domestic issue.

He said he, the president, Vice President Dick Cheney and other administration officials will be in 29 states over the next two months.

“Americans are beginning to have a good understanding the system won’t be there unless we act soon,” he said.

In their annual report last year, the Social Security trustees said, "Present tax rates would be sufficient to pay 73 percent of scheduled benefits after trust fund exhaustion in 2042 and 68 percent of scheduled benefits in 2078."

Evolving ideas
Snow set off concern among conservatives by suggesting Wednesday the administration might consider “add-on” accounts, which do not drain money from the traditional Social Security program. Some proposals would pay for the accounts with general tax revenue; others would require workers to contribute more of their pay.

“I think right now, the more ideas, the better. We like to see ideas,” Snow told reporters. “My preference would be for the sort of proposal that we’ve put forward. On the other hand, we’re prepared to engage people.”

The administration is under time pressures: Senate Finance Committee chairman Charles Grassley, R- Iowa, warned last month that if Social Security legislation “isn’t done this year, it won’t be done for ten years.”

Meanwhile on Thursday Federal Reserve chairman Alan Greenspan praised the virtues of a consumption tax, which economists such as Laurence Kotlikoff have argued would be one equitable way to help pay the staggering cost of unfunded liabilities for Medicare, Medicaid, and Social Security.

According to the General Accountability Office, the government’s fiscal watchdog, the federal government’s net liabilities, unfunded commitments, and other obligations now amount to more than $43 trillion, or about $350,000 for every full-time worker.

Keeping communication open
While most congressional Democrats have flatly refused to negotiate with Bush or GOP leaders until the issue of private accounts is taken off the table, a few Democrats are keeping lines of communication open

Sen. Ben Nelson, D-Neb., who has been consulting with Sen. Lindsey Graham, R-S.C, on ideas for legislation, indicated in comments to reporters Tuesday how wary most senators are about committing support to specific ideas for redesigning Social Security.

“It never hurts to talk about ideas, as long you know you’re talking about ideas,” said Nelson. “The challenge is (to ensure) that whatever you’re talked about, doesn’t get reported that that’s your position. … I can talk about an idea or two ideas or three, but I get disturbed when I see that somebody says, ‘He’s going to go for this,’ just because I talked about it.”

Nelson added, “I’m going to look for compromises wherever possible to accomplish something.”

A few Senate Democrats such as Sen. Edward Kennedy of Massachusetts and Sen Debbie Stabenow of Michigan, have offered tax increases as solutions to the Social Security solvency problem but Democratic House and Senate leadership has not signed on to that idea.

The Associated Press contributed to this story.