Taking seniors out of the debate

SUN JOURNAL

Benefits: As the president and Congress members try to reform Social Security, they seek to reassure a powerful voting bloc that it won't be affected by the overhaul.

December 15, 2004|By Julie Hirschfeld Davis | Julie Hirschfeld Davis,SUN NATIONAL STAFF

WASHINGTON -- When 57-year-old Jay Sherman of Baltimore hears President Bush and members of Congress talk about rescuing Social Security from bankruptcy, it makes him nervous.

The environmental consultant has heard policy-makers promise that people like him -- who are less than 10 years from retirement -- will not be affected by an overhaul of the system, which experts say is headed for insolvency as early as 2042. But Sherman votes, and he worries that even if he gets the benefits that he has long been promised, reforming the system could erode it just as he retires, and that future workers would be worse off for the change.

"I would like the government to provide a safety net both for me and for younger generations -- this is a long-standing commitment," Sherman said. "I am concerned about the enormous debt that is going to fall on everybody, and it makes me nervous about what the obligations are going to be on me."

As Bush opens his economic summit today, with Social Security reform at the top of his ambitious domestic wish list, convincing people like Sherman that they have nothing to lose is among his top priorities.

The president and proponents of an overhaul are keenly aware that seniors are a potent voting bloc that is fiercely protective not just of its own retirement benefits but also of what many consider Social Security's ironclad promise to generations that follow theirs.

Bush and other would-be reformers are struggling to determine how to enact radical changes that would strengthen Social Security and appeal to younger workers without alienating older people. When he laid out his principles for reform in his weekly radio address Saturday, Bush hastened to reassure older workers: "First," he said, "nothing will change for those who are receiving Social Security and for those who are near retirement."

That guarantee could be especially important -- both practically and politically -- in light of Bush's favorite idea for overhauling Social Security: shifting a portion of people's payroll taxes into private retirement accounts that could be invested in the stock or bond markets. The idea appeals less to people the older they are, polls show.

So, before Bush and his Capitol Hill allies propose specific changes to the Social Security system, backers say, they must convince retirees and older workers that they are not a part of the debate.

"The first thing you do is you convince anybody who's at or anywhere close to retirement that under no circumstances does this have anything to do with them, and so the people who are likely to be most negative about this process you try to take out of the room as quickly as you can," House Majority Whip Roy Blunt of Missouri said last week. "The younger the workers are you're talking to, or potential workers you're talking to, the more likely they are to believe that Social Security is not a good system."

Proponents of overhauling Social Security say it is only fair to exempt people who rely on it, or soon will, from changes.

"If you made your plans for retirement based on a certain level of income and retirement benefits, we don't want to change that, so we say this is only for people who are retiring in the future, and fairly far into the future," said Rep. Jim Kolbe, an Arizona Republican who has introduced a reform plan that creates private accounts.

But skeptics say promising older workers that they will not be touched by Social Security changes is merely a political ploy to squelch opposition.

"It's politics -- it's a fear of the elderly lobby," said Robert L. Bixby, the executive director of the Concord Coalition, a budget watchdog group. "They're trying to say, `Look, this isn't going to affect you. Leave us alone! Don't come after us!'"

Opponents of reform say convincing older people they won't feel direct pain will not ensure broad support for change.

"They want older people not to be part of this debate, and I think older people want to be part of the debate -- not because they worry about their benefits but because they think the system is good, and they want it to be there for their children," said Evelyn Morton, a national coordinator for economic issues at AARP, the nation's largest senior's group, which opposes private accounts.

Besides, opponents said, the accounts would cost the Social Security system money -- some say as much as $2 trillion -- and dig the government deeper into a debt that would hit all Americans.

Reassuring older people is but one way of edging to what has long been called the "third rail" of politics: fixing a Social Security system that most agree is heading toward financial problems. Actuaries say that by 2018, Social Security will begin paying more in benefits than it collects from taxes. By 2042, they estimate, its financial reserves will be exhausted, and it will be unable to cover its full obligations to retirees.

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