GOP Divided Over Pushing Reform of Social Security

The White House and congressional Republicans, who will join in triumph Monday when President Bush signs a landmark overhaul of Medicare, are at odds over how hard to push now for reform of government’s other major program for the elderly, Social Security.

In his reelection campaign next year, Bush is expected to make a new pitch for his long-shunned plan to shore up the financially shaky retirement system by allowing workers to divert some of their Social Security taxes to personal investment accounts.

But many Republicans in Congress are cringing at the prospect of tampering with the popular program as they head into a cliff-hanging election year. Some are warning the White House that even talking about Social Security could be politically damaging to vulnerable incumbents and undercut gains the party made among 65-and-older voters by passing the Medicare bill.

“I hope Bush doesn’t utter one word about it,” said Rep. Ray LaHood (R-Ill.). “There may be a few conservatives in our party who support [Social Security reform], but the vast majority ... would say, ‘Please do not talk about it.’ ”

Some Republicans want Bush instead to do more to help explain and sell to senior voters the virtues of the complex Medicare bill Congress just passed. The sweeping measure provides prescription drug coverage and other new benefits as well as incentives to increase the role of private health plans and insurers in Medicare.

“They should stop talking about Social Security reform and start talking nonstop about Medicare,” said a senior House Republican aide who has been planning strategy with the White House. “We made it clear to them we don’t like it. We’re not taking it up. Dead as a doornail.”

Still, Bush has some allies on Capitol Hill who want the issue in the forefront. A small but growing cadre of Republicans have advocated Social Security reform during their own campaigns and been pummeled by their opponents -- but still won election. One, Sen. Lindsey O. Graham (R-S.C.), discussed the issue with Bush during a recent visit to his state.

“He thinks the public is ready for reform,” said Graham, who worked with the White House staff to draft a Social Security reform bill he introduced last month. “There are some who don’t want to talk about this during the election. But my political opinion is that it’s going to be an issue no matter what.”

The divisions among Republicans over how to handle Social Security point to a big difference between the road that led them to passing the Medicare overhaul and the rockier path Bush faces in restructuring Social Security: While there was broad agreement among Republicans about the need to pass a prescription drug benefit, there is less consensus about the political wisdom of making Social Security reform a priority now.

“The political analysis is all over the lot,” said a House Republican leader who asked not to be named. “There is a political queasiness and concern among some that this is a risky political venture.”

Medicare and Social Security face a common problem. Without big changes, eventual insolvency is almost inevitable as the enormous baby boom generation retires and draws benefits.

Republicans have argued that the best way to shore up both programs is to expand the role of the private sector in providing benefits. That, they hope, will lower long-term government costs while expanding investment and health-care options for retirees. Democrats have opposed such efforts, saying “privatization” undercuts the health care and income security guarantees seniors expect from government.

Graham’s Social Security bill would give workers the option of investing as much as 4 percentage points of their 6.2% Social Security payroll tax in personal savings accounts they would own and control. Graham said his effort to build support for such ideas was bolstered by elements of the Medicare bill’s tax-sheltered health savings accounts. Just as those accounts would make it easier for people to save for future health care expenses -- an idea conservatives have championed to encourage more individual choice and responsibility -- so too would personal savings accounts let them save for retirement.

But other elements of the Medicare bill may pose new obstacles to overhauling Social Security: The enormous cost may make it harder for Congress to find the money needed to finance the transition to any new Social Security system.

Bush’s 2000 campaign platform called for restructuring Social Security, but the only action taken during his first term has been to set up a study commission that came up with inconclusive recommendations. That leaves Social Security as one of the biggest items of unfinished business on Bush’s agenda as he seeks a second term in 2004.

White House officials have told Republican allies that Bush wants to campaign on reforming Social Security in order to build his political authority for undertaking such an ambitious project in his second term.

“The administration intends to introduce Social Security reform in a way that, when they get reelected, he will be able to say this is a mandate to allow us to do certain reforms,” said Grover Norquist, president of Americans for Tax Reform and an administration ally on the issue.

Bush allies are trying to convince fellow Republicans that Social Security is no longer the risky political issue that earned it standing as the “third rail” of American politics. They point to congressional campaigns like Graham’s Senate election in 2002 and Elizabeth Hanford Dole’s North Carolina Senate race as evidence that it can even be a winning issue. Dole, under attack for supporting personal retirement accounts, responded by holding up a blank sheet of paper and chiding her opponent for having no plan of his own for shoring up the program.

Some Republicans, while ruling out any action in 2004, say they are comfortable if Bush talks about the issue during the campaign to help lay the groundwork for the future.

“I am open to seeing debate get underway,” said Rep. Thomas M. Reynolds (R-N.Y.), chairman of the National Republican Congressional Committee. “But I don’t believe we’re going to see legislation in 2004.”

Others are more worried that spotlighting the issue in campaign speeches or ads risks alienating swing voters.

“This is going to be a very close election,” said LaHood. “We’ve got the senior citizens with us now. If we want that to go down the tubes, the easiest way is to start talking about privatizing Social Security.”

Even Rep. Rob Portman (R-Ohio), an enthusiastic advocate of Social Security reform, said he was wary of diving into the issue at a time when Bush and Republicans still faced a big challenge in explaining the Medicare bill.