Double-talk on Social Security

Gore-Bush: Neither candidate addresses solvency question, though both promise enhanced payouts.

Presidential Agenda 2000

June 23, 2000

AL GORE has big plans for enlarging your Social Security benefits. So goes George W. Bush.

But don't hold your breath. Neither of them is proposing a solution that will ensure the future solvency of the nation's retirement system.

Instead, the two presidential candidates are touting splashy programs that will let people play the stock market with money earmarked for their leisure years.

Americans should view the two proposals skeptically.

Mr. Bush wants to let individuals invest some of their Social Security payroll tax in stocks. What isn't advertised by the Texas governor is that those who take this option would see their monthly Social Security payments shrink.

The hope is that investors will more than recoup their losses through a rising stock market.

But there's no guarantee. Stocks go up -- and down. Some people might reap big rewards, but others could lose big -- on top of getting smaller monthly checks from Social Security. Who's going to make up the difference?

The Bush plan caters to middle- and upper-income Americans who understand and are comfortable investing in the markets. That would only widen the division between the haves and the have-nots in American society.

Mr. Gore's plan mimics Mr. Bush's plan to incorporate stock investments into Social Security, but in a sharply different way.

The vice president wants to set up a type of 401(k) retirement plan on top of the monthly Social Security check. There would be a generous government match (on a sliding scale) for every dollar you put up. And you'd earn a tax credit.

You could invest this money in certain types of mutual funds, but you'd also get your full Social Security payments.

Mr. Gore's plan won't appeal to folks who struggle from paycheck to paycheck. Only the more savvy middle-income investors will take full advantage of this program.

The vice president, like the Texas governor, misses a fundamental point: People aren't clamoring for larger checks from Social Security. What they want is certainty that their benefits -- their full benefits -- will be available when they retire.

That could mean committing huge sums of federal dollars to the Social Security trust fund. It could mean raising the retirement age for benefits over the next century. It could mean allowing trustees to invest a portion of Social Security reserves in higher-yielding but conservative bond funds.

The next president must have the political gumption to confront this crisis and address fundamental weaknesses in the government's retirement system. Mr. Gore and Mr. Bush have failed to do so thus far.

Americans don't need glitzy window dressing. They need answers.

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