Bush: Tax hikes on the table for Social Security

December 20, 2006 at 9:25 am

The Washington Post:

Signaling a new flexibility on issues in the wake of the Democrats’ wins, Bush said he is willing to discuss Democratic ideas for solving the Social Security problem, including tax increases. “I don’t see how you can move forward without people feeling comfortable about putting ideas on the table,” Bush said when asked about the prospect of tax increases to keep Social Security solvent. “I have made it clear that I have a way forward that can do it [without raising taxes] and I want to hear other people’s opinions.”

Here is the problem: Bush will put tax increases in the table for discussion while Democrats will continue to say no to discussing personal retirement accounts. It is not a fair trade. This is a strategy that I fear will end with a poor solution for the Social Security problem and a tax increase. If that happens, all the effort that this President has put forth to avoid the “read my lips” moment that his father could not will have been for nothing.

Majority acknowledge Social Security needs fixing

December 11, 2006 at 2:20 pm

Over at the Club for Growth, where I will be occassionally guest-blogging this week, David Keating cites a recent Rasmussen poll that shows that Americans, by a 2-1 margin, say Social Security needs to be fixed.

On one hand, that is good news because the old entitlement program is headed for big problems, but conservatives are rightly worried about how the program will be “fixed.”

Dems talking Social Security

December 6, 2006 at 3:38 pm

This from today’s Evans-Novak Political Report:

Democrats are finally talking about reforms that would keep Social Security solvent, but they want a solution that the President had been unwilling to embrace in the past — tax-hikes generally, and specifically an increase in the maximum income subject to the Social Security tax. Conservatives are very distrustful of whether President Bush will keep his 2002 promise only to allow a tax hike over his own dead body.

The Bush Administration has been noticeably dodgy about this. In an interview on CNBC, Larry Kudlow could not get White House economic advisor Al Hubbard to promise that President Bush would not accept a tax-hike as part of the Social Security solution.

Destroying Social Security?

December 1, 2006 at 9:39 am

Senate Majority Leader-elect Harry Reid from a recent interview:

“We have to govern the way we did for a couple hundred years, not on the basis of ideology, but to get things done. Think, it’s been ten years since we’ve had a raise in the minimum wage. That’s scary. Forty-seven million Americans don’t have health insurance. We have someone trying to destroy social security,” Reid said.

Who Harry? Who is trying to “destroy” Social Security? Is it conservatives? Are they trying to “destroy” the program by being the only public figures who are putting forth proposals to permanently deal with the program’s long term solvency issue?

That seems like a pretty irresponsible comment to me.

Is Bush headed for a “read my lips” moment?

November 29, 2006 at 8:48 am

There is increasing chatter in Washington about Social Security reform again becoming an issue in 2007. With a new Democratic Congress in charge, previous proposals from conservatives to permanently fix the ailing entitlement program look to be dead. But now, there is talk of shorter term fixes:

In recent days, Bush and senior administration officials have revived talk of reaching an accord on an overhaul of Social Security that would maintain the program’s solvency beyond the baby boom generation’s retirement. In an interview with The Washington Post last week, Treasury Secretary Henry M. Paulson Jr., the president’s point man on Social Security, promised that the White House will enter talks with Democrats with “no preconditions.” That is a significant shift for Bush, who had previously said that any Social Security legislation would have to include private accounts that would allow workers to divert some of their payroll taxes to investments in stocks or bonds.

McConnell added another concession yesterday, saying that Social Security legislation should “solve the problem as far into the future as possible” — a standard that is far more flexible than Bush’s insistence on nothing short of a “permanent” fix.

By taking personal accounts off the table Republicans would be playing right into the Democrats’ hands. Liberals have always seen only one solution to the Social Security solvency problem: raise taxes. Now, by not offering a viable alternative to fix the program, a tax hike could be the only solution left standing.

Andy Roth over at the Club for Growth summed it up pretty well. “If President Bush takes personal accounts off the table, and relies on tax hikes to “fix” Social Security, then his legacy will be no better than his father’s,” said Roth. “While the current president didn’t say, “read my lips”, he did sign a pledge not to raise taxes. And that’s just as bad.”

Let the scare tactics begin

August 25, 2006 at 1:56 pm

Stephen Moore, writing for the WSJ Political Diary email, reports on a renewed round of scare mongering being used by Democrats for political advantage this fall:

The mid-term elections are three months away but Democratic attack dogs are already pounding Republican incumbents for harboring secret plans to destroy Social Security. “We’re getting hit hard and early on Social Security,” says a Senate leadership aide. “I’m worried this could lead to moderate Republicans renouncing their support for personal investment accounts.”

The issue has become a livewire in the key Senate battleground states of New Jersey, Ohio, Pennsylvania and Washington. Bob Casey, the Democratic challenger in Pennsylvania, is lambasting incumbent Rick Santorum on the issue of Social Security cutbacks.

We’ve heard this record before from Democrats — a ploy that began in earnest back in 1982 when the Tip O’Neill Democrats tarred and feathered Reagan Republicans for trying to cut the cost-of-living increase in Grandma’s Social Security check. In every election since 1996, Democratic challengers have lobbed these political grenades at Republicans — but with not many casualties inflicted.

Moore suggests a counterpunch:

Republicans could flip the table on the Democrats on this politically sensitive issue by rallying behind a bill drafted by Senator Jim DeMint of South Carolina. Mr. DeMint would take the annual Social Security surpluses (i.e. payroll taxes collected each year in excess of benefit payouts) and invest those dollars in young workers’ private accounts. Mr. DeMint calls this plan “Stop the Raid, Start the Accounts.” Polling indicates that what makes seniors and young workers angriest about Social Security is that $100 billion a year is stolen from the trust fund and spent on other programs. More than two-thirds of voters say they favor something like the DeMint plan to stop their payroll taxes from being diverted to unrelated federal pork. By squirreling these dollars into private accounts, the raid would immediately end.

Rather than running away from Social Security, Republicans could take the offensive on the issue and force Congress to cease and desist from one of the greatest raids on taxpayer funds in history. “We’ve got to be smart about this,” says Mr. DeMint. “Let Democrats explain why they want Social Security dollars spent on other government programs rather than retirement. This will let clarify for voters which party favors destroying the program.”