The governor dined with Jose Piñera, architect of Chile's 1981 shift from government pensions to worker-owned retirement accounts, in a meeting that helped bring Bush a big step closer to embracing a similar plan for Social Security in his emerging presidential platform.
"I think he wanted to support the idea but needed to be convinced," said Edward H. Crane, president of the libertarian Cato Institute, who was at the dinner. "I really think Jose convinced him."
This week, President Bush's plan to allow younger workers to divert Social Security taxes into personal investment accounts will be a centerpiece of his State of the Union address and a barnstorming tour of the country. It is a tough sell to an uncertain public, but Bush has a secret weapon: A generation of free-market conservatives like Crane and Piñera has been laying the groundwork for this debate.
"It could be many years before the conditions are such that a radical reform of Social Security is possible," wrote Stuart Butler and Peter Germanis, Heritage Foundation analysts, in a 1983 article in the Cato Journal. "But then, as Lenin well knew, to be a successful revolutionary, one must also be patient and consistently plan for real reform."
Now, Bush is drawing on a deep reservoir of resources — including policy research, ready-to-hire experts and polling on how to discuss the issue — that conservatives have created over the last 20 years.
When he needed a committed ally at the highest levels of the Social Security Administration, Bush two years ago tapped Cato's staff. When Bush told African American leaders last week that blacks would especially benefit from his proposal, he drew from a controversial 1998 Heritage Foundation paper arguing that African Americans were shortchanged by the current system because of their shorter life spans.
Thanks in part to the work of think tanks like Cato, Heritage and the National Center for Policy Analysis, Bush is also benefiting from a public opinion climate that is far more receptive to changing the government retirement system than it was 20 years ago.
That is partly because these groups have broadcast a consistent message: Social Security is financially unsustainable and will collapse after the baby boom generation retires. Although that is debatable, polls show that most Americans lack confidence in the program's future.
"It started as the third rail of politics, but over a period of time conservatives kept at it until [their assumptions] began to sound like common sense," said George Lakoff, an expert in political communication at UC Berkeley.
Critics of personal accounts, such as the AFL-CIO and the seniors lobby AARP, have mobilized to counter that Social Security is in good health and sustainable with minor modifications. They also argue that to pay for worker-owned accounts, the government would have to cut benefits or take other steps that undermine the health of the system.
Critics also point to the Chilean program that Bush cites as a model, and say it demonstrates the potential pitfalls of private accounts. Recent reports indicate that, as the first generation of Chilean workers on their new system begins to retire, many believe it is failing to deliver as much in benefits as they would have received under the old system.
But Dan Maffei, spokesman for Democrats on the House Ways and Means Committee, concedes: "Democrats are playing catch-up, because they haven't done 20 years of groundwork."
When free-market economist Milton Friedman advocated privatizing Social Security in 1950s and 1960s, it was mostly an academic argument. By 1977, when Crane established the Cato Institute to advance libertarian ideas, Social Security was a signature issue.
Even as a young man, Bush was sympathetic to revamping the program. When he ran for Congress in 1978, he argued that the program would go broke by 1988 if people were not given the ability to invest the money themselves, according to the Texas Observer. But Bush lost that House race and apparently was not persuaded to push the issue again until decades later.
Most politicians of both parties remained skittish about Social Security changes, even after President Reagan was elected in 1980 on an anti-government platform.
Edwin Feulner, president of the Heritage Foundation, remembers meeting in the Capitol with House Republicans to discuss policy after Reagan's election. After discussing such topics as transportation and foreign aid, Feulner broached Social Security, but Rep. Robert H. Michel (R-Ill.), then the House GOP leader, interrupted by placing a cautionary hand on his arm.
"We don't talk about changes to Social Security inside this building," Michel said.
Reagan quickly learned why. In 1981, he proposed cutting benefits to shore up the retirement fund, which was close to insolvency. That drew a hailstorm of criticism and contributed to heavy GOP losses in the 1982 elections.