Veteran lawmaker tells why president is correct to change Social Security
Q. Social Security has been known as the third rail of American politics. Why is the president now advocating such a major change in the program?
A. Because we only have a 13- to 15-year span to fix it at a price the country can really afford. There are budget estimates that show we're losing $600 billion a year as long as we wait.
Q. Granted, but even your own colleagues, including House Ways and Means Chairman Bill Thomas, believe the president's proposal is dead on arrival. Isn't the president facing bipartisan opposition at this point?
A. No, but many of the members can't get over the fact that this has been a political issue that traditionally the Democrats have been able to get us with. But I think that whole thing has moved around. I think the president's re-election should give our members some courage, particularly when talking about the younger people.
The younger people do not believe Social Security will be around for them. They're almost fatalistic about it. I've had hearings at the University of Missouri, I've had hearings here at Florida Atlantic University and other places where we tried to pull young people in and the interest is not there. You'll find that the average age of people who go to these hearings is older than I am.
But, the president, I think, has given the necessary assurance to the seniors and persons 55 years and over that this thing isn't going to be changed [for them], and it's not. I'd go one step further. I'm not going to change it for their kids and grandkids, because I can solve it without doing that.
Q. Please elaborate.
A. If we start adding the personal accounts right now, we have to borrow the money to do it. We don't use any FICA tax. We leave that alone. We don't take anything out of the trust fund and we do not increase taxes and we do not cut benefits.
But, we do borrow money to put into the individual accounts in an amount equal to 4 percent of their wages, capped off at a thousand dollars. This is money that the federal government borrows and puts into these personal accounts.
Those accounts will grow. They will be there to help pay the benefits and so they will take a lot of the pressure off of the Social Security Administration, so that we will be able to pay full benefits for the next 75 years and beyond.
To do nothing, we're facing a $26 trillion cash shortfall over the next 75 years. That's more than all the wages paid in this country. So, we've got to do something.
Q. There are still those big questions, like where do we get the two to three trillion dollars, or whatever the estimate
A. I'd borrow it. I'd borrow it and pay every bit of it back. By 2037, we will start paying it back. I'm also putting a provision in my bill that once that surplus starts coming back in again, the Congress can't touch it. It will have to go toward paying off the bonds.
Q. Do you think the president will go for that?
A. This is different than his plan, but this one I think is politically salable. This one should not be challenged by the AARP. This one makes it extremely difficult for the minority party to attack it as an attack on the Social Security Trust Fund, because I don't touch it. I don't touch it.
It's important that the readers truly understand Social Security had 43 workers per retiree in 1940. Now it's down to a little over three, soon it will be two. It's a pay-as-you-go system. How can we burden our workers with enough FICA tax to truly support two seniors? It's not working.
What we need to do is to start investing now and let those personal accounts grow and be there to pull Social Security out of the ditch when it needs to.
Q. Bush has shown some flexibility in considering reducing benefits and raising retirement age. Do you think he'll show enough flexibility to use your bill to get his personal accounts?
A. The president has been criticized in some circles for not having vetoed bills that have gone through the Congress and sent to him. He's never vetoed a bill. The reason he hasn't is because he's worked with the Congress. So when we send something up to the president for his signature, he has been working with Congress in putting it through.
Q. Do you agree with the administration's assessments on the red-letter dates that Social Security will be in the red by 2018 and won't have enough money to pay benefits by 2042?
A. There are new figures out to suggest 2020 instead of 2018, but to answer your question -- absolutely. You can't argue with that. President Clinton believed that. I was chair of the Social Security subcommittee during the Clinton administration. He wanted to do something. This is exactly what President Clinton wanted to do.
Q. But, he wanted to the government to administer the accounts. Didn't he?
A. Well, there may have been some differences, but when the Democrats say that this is a Republican-crafted crisis, President Clinton all but said that [he acknowledged a problem] when he was speaking at Georgetown University during his term. So he knows the problem, and I personally talked to him about my plan. I told him: "We have to get this thing moving." He said if you get the leadership on the Hill to go along with you, I'm there. That's exactly what he said, and I went to [Missouri Rep. Richard] Gephardt and the others, and they wouldn't budge.
Q. So why do you think this president has a better shot than his predecessor?
A. Well, President Clinton never pushed it. He sat back and waited to be invited in by the Democratic leadership, and they really didn't want Social Security to be reformed under a Republican Congress. It was that simple.
But time's getting short. Now, it's a question -- do you care about your kids and your grandkids? I think the message has gotten through. Sixty percent of the American people now do recognize that there is a crisis, and that's what is going to move this thing.
Q. But the administration seems to be using a familiar refrain. Do critics have a point when they say the white-hot rhetoric of an immediate crisis sounds like the rush to make another big decision to go to war with Iraq?
A. Well, no they don't. The biggest lie that is being told in this whole thing -- and it is a lie -- is that there is plenty of money in the Social Security Trust Fund to carry this thing through to 2050. It's a lie. There is no money in the trust fund. The trust fund doesn't hold any money.
The money that doesn't go out as benefits is put into the general fund and Congress has been spending it since 1940. It's all gone.
Q. How do you think the president's proposal is playing here in your district, particularly among individuals who are in their late 40s, early 50s, who will be the first to use the accounts?
A. I'm 65; 45 is young. It depends on how old you are as to what's young. The people who are around 45, they're going to have a problem because we're saying Social Security is going to be short of money in 13 to 15 years. People who are now 45 in that time will be 60. They still haven't reached retirement age. So that age group is going to be facing a shortage.
Q. So, what feedback are you hearing for the proposal in the district?
A. Let me give you an example. I was at an event up in Palm Beach County. I must have been the youngest person in the room. I talked to them about the plan and there were probably 300 people in the room. They liked it. They liked it because they care about their grandkids. They care about their children. They care, of course, about themselves. They've earned these benefits and they don't want them taken away.
But once you get into it and explain, then all of a sudden, they understand that there's a problem. I don't want to enjoy the taxes paid by my kids and grandkids to Social Security benefits, unless it's going to be there for them, too.
Q. There are those who believe the president, as his own strategists have suggested, hopes to leave a legacy and secure a place for Republicans by going after one of the Democrats' most popular entitlement programs. Any credence to that?
A. I think President Clinton wanted to leave his legacy. I think anybody who gets in politics would want to leave something that shows that they made a difference.
In my political career in Washington, I sort of got the jobs that no one else wanted. I got welfare reform. We pushed it through and I got President Clinton to sign it, and that was a Republican bill signed by a Democratic president. That was President Clinton's legacy, too, because he signed it, and we got a good number, not a majority, of Democratic votes.
Does this president want this to be his legacy? I don't know if he would use that word or not but I hope it is his legacy. There's nothing finer than saving something that would make your children's retirement every bit as good as, if not better than, your own. We all live for our children. That's important, and I believe that's important to this president.
Q. Many know that you've worked hard on this issue, but there are some who feel that your voice seems to be missing in this more recent debate. I'll give you a chance to respond.
A. I've been everywhere. I've been on television more in the last three or four months than I have probably in three or four years -- perhaps in the last 20 years. I'll go anywhere, anytime to talk about the imminent crisis as well as the possible solution. I strongly believe that the whole key to getting this done is education, educating the voters, educating the American citizens as to what the problem is and what the possible solutions are and then push them through.
By the way, not only am I having meetings in my district, but also in others because I believe strongly that this is just too important to let fall under the weight of false political accusations.
Q. Do you think the president helps his cause by campaigning for the proposal in those "red" states with Democratic senators? Does that help earn bipartisan support for such a big change?
A. Oh yeah. We all like to reflect the wishes of the people we represent. The president strongly believes, and he's absolutely correct, that educating the voters in those particular areas as to the pending crisis that we have will bring those people along and the people who represent them along.
I can speak in one area, Arkansas. Blanche Lincoln is the Democratic senator from that state. I've spoke to her myself right after the State of the Union address, and she and I will sit down and talk about it.
I'm working within the Senate to help get them mobilized. So I'm doing an awfully lot of spadework on this.
Q. If nothing else, the president gets credit for jumpstarting the debate on changing this program. Ultimately, how do you think this will play out?
A. I think we've got probably better than a 50-50 chance at getting it passed. It's not going to be easy, but I think we'll do it.
Interviewed by Senior Editorial Writer Douglas C. Lyons
Former Fort Lauderdale Mayor E. Clay Shaw developed a reputation for taking on tough challenges in Congress. As a member of the powerful House Ways and Means Committee, he worked on welfare reform during the Clinton administration and passed major welfare-reform legislation. In 1998, he took over the chair of the Ways and Means Social Security Subcommittee, an ideal post for a congressman whose district has one of the nation's highest percentages of individuals 65 and over.Copyright © 2015, Los Angeles Times