Benefit cuts, tax increases, a higher eligibility age or a combination of those steps are needed to keep Social Security funded long-term, regardless of President Bush's idea for personal investment accounts, the head of a congressional agency said Wednesday.
The fund will need several trillion dollars -- sooner if the investment accounts become law, later if no changes are made to the system, said Comptroller General David Walker, head of the General Accounting Office.
"You've got to act -- you don't have a choice," he told the Senate Special Committee on Aging. "The question is when are you going to act, and how you're going to act."
Bush favors letting younger workers invest a portion of their payroll taxes in the stock market as a way to secure future funds.
Sen. John B. Breaux, a Democrat from Louisiana and a White House ally on the accounts, said he would support an overhaul, even if it meant raising the retirement age to reflect longer life spans. But reform is not likely this year without leadership from Bush, whom Breaux urged to discuss the issue in his State of the Union speech this month.
"It could happen this Congress if the president gets four-square behind it," Breaux, outgoing chairman of the committee, said after the hearing.
"There's no question we have a big hole," said Sen. Debbie Stabenow (D-Mich.), questioning the White House's desire for more tax cuts at the expense of Social Security funds. "The first thing is to stop digging."
Walker said one plan proposed by the president's Social Security Commission in 2001 would cost $2.2 trillion and reduce benefits. Closing the shortfall in the current system for 75 years means the bill comes due later and larger at $3.4 trillion.