Bush: Program’s Heading ‘to Bankruptcy’

President Bush, saying Saturday that Social Security is “on the road to bankruptcy,” again called for giving workers more control over their retirement funds but offered no specifics for shoring up the benefit program

In his weekly radio address, Bush warned: “If we do not act now, government will eventually be left with two choices: dramatically reduce benefits or impose a massive, economically ruinous tax increase.”

The president said younger workers should have the option to invest in a personal retirement account as part of the 6.2% of income they now pay in Social Security payroll taxes.

“Unlike Social Security benefits, which can be taken away by politicians, the money in a personal account would be yours,” Bush said. “And unlike the money you put into Social Security today, the money in personal accounts would grow.”

Bush did not explain how diverting payments to the personal retirement accounts would help buttress Social Security. He did say, “We owe it to the American worker to fix Social Security now.”

Despite the president’s warning about a looming bankruptcy, the nonpartisan Congressional Budget Office has projected that, even if no changes are made, the Social Security trust fund will remain solvent until 2052. The Social Security Administration has estimated that the benefits guaranteed to seniors through 2080 will exceed the system’s revenue by $3.7 trillion.

Sen. Debbie Stabenow of Michigan delivered the Democratic response to Bush’s radio address. Citing a White House memo, Stabenow warned that the president might push for “deep cuts” in Social Security benefits.

The memo, written by Bush’s director of strategic initiatives, Peter Wehner, said that the White House would “take a very close look at changing the way benefits are calculated.”

Existence of the memo first was reported Jan. 5 by CongressDaily, a publication that chronicles congressional news.

Stabenow said: “America’s insurance policy was never meant to be a privatized 401(k) plan or a high-risk investment. It was meant to be the secure foundation for your retirement.”