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Skriven 2005-04-18 23:34:12 av Whitehouse Press (1:3634/12.0)
Ärende: Press Release (0504181) for Mon, 2005 Apr 18
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President Discusses Strengthening Social Security in South Carolina
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For Immediate Release
Office of the Press Secretary
April 18, 2005

President Discusses Strengthening Social Security in South Carolina
South Carolina Statehouse
Columbia, South Carolina


˙˙˙˙˙In Focus: Social Security


12:17 P.M. EDT

THE PRESIDENT: Thank you all very much. Mr. Speaker, thank you for that
kind and short introduction. (Laughter.) I appreciate Governor Sanford
being here. I want to thank the Lt. Governor. I appreciate President Pro
Tem McConnell, Majority Leader Leatherman, members of the South Carolina
legislature. I appreciate my traveling party from Washington. Hope you
appreciate them, too. That would be Senator Lindsey Graham, Senator DeMint,
members of the United States House of Representatives from the great state
of South Carolina. I appreciate the justices of the South Carolina Supreme
Court being here. I thank those of you who have taken time to come and
listen. I appreciate your warm welcome.

It is an honor to be speaking in this chamber. It is great to be back in
the capital of South Carolina. The last time I came to this city I gave the
commencement speech at USC. I was proud to have received an honorary
degree. When I told Laura about it, she said, "I thought your first degree
was honorary." (Laughter.) She sends her best and she sends her love.
She's, by the way, a fabulous First Lady. She is -- (applause.)

I appreciate our escort committee. I told the members that this is the
first time I have spoken to a legislative body, state legislative body
since I was the governor of Texas. So thank you for having me. It's --
there's some differences, of course. There are a lot of cowboy hats back in
Austin. (Laughter.) And I'll be honest with you, a lot of us didn't know
anything about dancing the shag. (Laughter.) And I imagine we could have a
pretty good debate about which of our states has the best barbecue.
(Laughter.) Now is not the time. (Laughter.)

But one thing is, no matter whether you serve at the federal level or the
state level, we share serious responsibilities. See, our constituents have
put us into office to solve problems now. That's what they've done. They
said, we've elected you to go to your statehouse, or in my case,
Washington, D.C., to solve problems. The people expect us to confront
problems without illusion. They expect us to lead with conviction and
confidence, not by reading the latest poll or listening to the latest focus
group. And above all, they expect us to deliver results.

And here in South Carolina, you've delivered results. You've faced serious
challenges, especially in your economy. Listen, we've had a stock market
decline, we've had a recession, we've had corporate scandals, we had a
terrorist attack on September the 11th, 2001, we've had the demands of war.
And all these have tested our nation's economy. And they hit particularly
hard here in your state. South Carolina's economic growth slowed; small
businesses moved out or shut down; workers lost their jobs; and state
finances were headed toward a free fall.

The people of South Carolina look to you and they look to your Governor for
leadership. And you delivered. You set clear priorities for your budget,
and you made hard decisions when it came to spending. To rein in the rising
costs of health care, you became one of the first states in the nation to
offer health savings accounts to state employees. To reward hardworking
families and job creators, you refused to raise taxes on the working people
of South Carolina. You focused bipartisan actions; you've lifted your state
out of fiscal crisis; you've erased a $155 million deficit, and you've done
it two years ahead of schedule. Today South Carolina families are planning
for the future with confidence.

I found this to be an interesting statistic about your state: More than 76
percent of the people in your state own their own home, one of the highest
rates in the United States. Small businesses are investing and expanding,
exports are on the rise. Thanks to your leadership, thanks to your hard
work, thanks to your willingness to set aside partisan differences, jobs
are coming back to the great state of South Carolina. (Applause.)

In Washington, we're moving forward with an ambitious agenda to keep this
country safe, prosperous and free. The war on terror goes on. There are
still ruthless enemies that would like to do harm to our people. We will
continue to keep the pressure on these folks. We'll work with our friends
and allies to be unrelenting in our search to bring them to justice. We
will not rest until America is safe. (Applause.)

We'll continue to work to improve security here at home, but in the
long-term, in the long run, the best way to protect America and to keep the
peace is to change the conditions that give rise to hopelessness and
extremism. And the best way to do that is to spread freedom around the
world. (Applause.)

I don't believe freedom is America's gift to the world. I believe freedom
is the Almighty God's gift to each man and woman in this world. (Applause.)
My administration will continue to pursue pro-growth policies to ensure
that America is the best place in the world to do business. To keep the
economy growing and create jobs, we will keep the taxes low. (Applause.)
We'll continue to confront the problems of junk lawsuits by pushing for
meaningful asbestos and medical liability reform. We'll work with Congress
to pass an energy bill that will make America less dependent on foreign
sources of energy. (Applause.)

I sent to Congress a disciplined federal budget, and both the House and the
Senate have passed budget resolutions. And now they need to work out their
differences and send me a budget that meets America's priorities, that
restrains federal spending, and that keeps us on track to cut the deficit
in half by 2009. In Washington, and in Columbia, South Carolina, government
needs to follow a straightforward principle, a taxpayer's dollar must be
spent wisely, or not spent at all. (Applause.)

Strong leadership means rising to the challenges of the day. It also means
looking down the road. There will always be problems that arise
unexpectedly; yet problems -- some problems are completely predictable. And
as leaders, you and I have a responsibility to confront those problems
today, and not pass them on to future generations. (Applause.)

Over the past few weeks I've been traveling around the country talking
about one of the most serious and most predictable challenges which face
our nation, and that is the long-term fiscal health of Social Security.
Social Security has been a great success. Franklin Roosevelt did a really
smart thing in setting up the Social Security system. It has provided an
important safety net for millions of Americans. Seniors in South Carolina
and seniors across this country depend on their monthly checks as an
important part of their lives, as an important source of income for their
retirement.

And today I have a message for every senior in South Carolina, and every
senior across this country: Do not pay attention to the propaganda and
scare ads. If you're receiving a Social Security check this month, you will
continue receiving a Social Security next month, and the month after that,
and every month for the rest of your life. (Applause.)

There are other Americans who are now approaching retirement and have been
paying into Social Security throughout their lives. These workers are
counting on Social Security as part of their retirement plans, and there's
money in the system for them. If you were born prior to 1950, America will
honor the promise of Social Security for you. The problem is that the
government is making promises for younger Americans that it cannot pay for.
In other words, there's a hole in the safety net for younger Americans.

See, Social Security is a pay-as-you-go system -- you pay and we go ahead
and spend here in Washington. (Laughter.) We spend on -- to provide
benefits for current retirees, and with money left over, we have spent your
payroll taxes on government programs. Some people think there's a Social
Security trust, where the government is holding your money, in an account
with your name on it. It just doesn't work that way. That's not the way the
system works. There is no vault holding your cash, waiting for you to
retire. Instead, because we spend Social Security taxes on current retirees
and other government programs, all that is left over in the so-called
security trust is a bunch of filing cabinets with IOUs in them.

As a matter of fact, I went to West Virginia the other day to look at the
filing cabinets, to make sure the IOUs were there -- paper. And it's there.
And it's, frankly, not a very encouraging sight. It's not encouraging
especially when you consider that times are changing in America, that the
math for Social Security is changing significantly. By the math I mean
this: In 1950, there were about 16 workers paying taxes for every
beneficiary -- 16 workers for beneficiary. And today, there's 3.3 workers
for every beneficiary. By the time our children and grandchildren are ready
to retire, there will only be 2 workers paying for every beneficiary in the
system.

That's only part of the problem. To compound the problem, the first baby
boomers will soon start retiring. I happen to be one of them. As a matter
of fact, I'm eligible to start collecting benefits in 2008 -- which happens
to be a convenient year for me. (Laughter.) The retirement of the baby
boomer generation is going to have a huge impact on Social Security,
because my generation is about 50-percent larger than my parents'
generation. Today there are about 40 million retirees receiving benefits.
By the time all the baby boomers have retired, there will be more than 72
million retirees receiving benefits. And thanks to advances in modern
medicine, these retirees will live longer and collect benefits over longer
retirements than the previous generation.

And to compound the problem even further, Congress has ensured that
benefits to my generation will grow faster than our economy or the rate of
inflation. In other words, people went around the country saying, vote for
me, I'll make sure your benefits are higher. And so this sets up an
enormous fiscal challenge facing Social Security. With each passing year,
there will be fewer workers paying ever higher benefits to a larger number
of retirees who are living longer.

And so here's the result: Three years from now, when the first baby boomers
start collecting Social Security benefits, the system will start heading
toward the red. Less than a decade later, in 2017, Social Security will go
negative. And by that I mean it will be paying out more in benefits than it
collects in payroll taxes. More money going out than coming in. And every
year after that the shortfall will get worse.

In the year 2027, the government will somehow have to come up with an extra
$200 billion to fund the system -- $200 billion more going out than coming
in through payroll taxes. In 2034, the annual shortfall will be more than
$300 billion a year. And by the year 2041, the entire system will be
bankrupt. Now, think about that. If we don't do something to fix the system
now, the students graduating this spring from the University of South
Carolina, or, in deference to the Speaker, Clemson -- (laughter) -- will
spend their entire careers paying Social Security taxes only to see the
system go bankrupt a few years before they retire.

And I don't care if you're a Republican or Democrat, these are the facts.
And the question is, do we have the will to do something about them. Now,
in South Carolina, you know that once you're in the red, the options of
getting out are never very appealing. If we allow Social Security to
continue on its current path toward bankruptcy, we will leave our children
and grandchildren with only a few drastic options to keep the system
afloat. In other words, the longer you wait, the longer we don't do
anything in Washington, the more drastic the solutions become.

For example, some estimate if we don't do anything, the payroll tax will
get up to 18 percent. Is that a legacy we want to leave on younger
generations of Americans? I don't think so. Or we're going to have to
dramatically slash benefits, or cut other federal programs. The Social
Security trust reported this: They said, every year we wait to fix the
system will add an additional $600 billion to the cost of reform.

I understand why some in Washington don't want to take on this issue. I
guess they calculate there's a political cost when dealing with a tough
issue. I think there's a political cost for not dealing with the issue. And
so I've been traveling this country of ours, making it absolutely clear
what the problems are. See, my strategy is pretty simple: Take the message
to the people and define the facts of the problem, and let the people draw
their own conclusions. I've been to 22 states to explain the facts. I've
been to those states to explain the urgent need for the United States
Congress to work with the administration to get something done now. And
more and more Americans are beginning to hear the message.

I'm just starting, I'm just warming up. As a matter of fact, I like getting
out of Washington, D.C. I like coming to places like South Carolina, to put
the facts on the table so the people can make their own mind about what's
happening in Social Security.

I don't know if you've ever heard of Dutch Fork High School in Irmo. I met
a very innovative teacher who assigned her students this assignment: Why
don't you write letters to the editor about their impressions of Social
Security? Here's what one of her students wrote: "By the time my generation
gets to the age to draw Social Security, there will be no money left for us
to draw on." This is a young high school student writing that. This isn't a
professor in economics. This is a high school student. He said, "I don't
know about other people, but I don't like the sound of that." People are
beginning to get the message that there is a problem in Social Security.

Today I met an 80-year-old -- 80-year-old young woman from Silverstreet
named Shirley. She said she's counting on Social Security. She gets a
Social Security check every month, and she's confident she'll keep getting
her checks. And there's no doubt in her mind she's going to get her checks,
but there's a doubt in her mind as to whether or not her granddaughters are
going to have comfort in their retirement, whether or not the safety net
will be there for them. Here's what she said: She said, "I don't know what
I would do without it. It's my granddaughters that I'm worried about, and I
want to do whatever is possible to fix the system for them."

Folks, we're talking about a generational issue here in America. The
grandfolks are going to get their checks, and the fundamental question is,
do we have the will in Washington, D.C. to make sure the system works for
the grandchildren of America. And that's what I'm here talking about.

I believe I have a duty to ask people to bring ideas forward. I brought a
few myself, and I appreciate the response of Senator Lindsey Graham. He's
brought some ideas forward, as has Senator Jim DeMint, as has your
Governor. These men have been leaders in the debate. They've stepped up,
and said, here are some ideas I'd like you to consider. But they're not the
only ones who have set up good ideas. Former Congressman Tim Penny, a
Democrat from Minnesota, has suggested tying Social Security benefits to
prices rather than wages. My predecessor, Bill Clinton, had time -- had
meetings all around the country on Social Security and he spoke of
increasing the retirement age at one time.

I put together a commission of Republicans and Democrats, headed by the
late Senator Daniel Patrick Moynihan of New York. And they did fine work.
They recommended changing the way benefits are calculated. In other words,
people are putting ideas on the table. An interesting idea was put forward
by a Democrat Social Security expert named Robert Pozen, who has proposed a
progressive way of structuring benefits that will be more generous to
low-income workers. And that's an important idea.

In other words, all these ideas are on the table, but they have one thing
in common -- they all require us to act now. Saving Social Security is not
a Republican goal, it is not a Democrat goal; it is a vital goal to all our
country. And people of both political parties need to get the job done now.
(Applause.)

There are some basic principles that must guide our efforts to fix Social
Security. We should not raise the payroll tax rate. That would hurt the
economy and cost jobs. We must ensure that Social Security continues to
provide dignity and peace of mind for Americans in retirement, and include
extra protections for those with low incomes. We must reject temporary
measures that put off Social Security problems for another day.

You need to be skeptical about any talk that talks about a 75-year fix.
Back in 1983, Republicans and Democrats came together on what they thought
was a 75-year fix. You know, I like the spirit of people of both parties
coming together, and that was great. President Reagan and Speaker O'Neill
said, we got a problem, let's come together to fix it. But they thought it
was a 75-year fix; here we are, 22 years later. It's time to come up with a
permanent solution. When people bring forth their ideas in Congress I will
insist that we not have a band-aid approach to Social Security, that we
have a permanent fix. And I'm optimistic about the chances for meaningful
Social Security reform.

You know, a few weeks ago the United States Senate voted on a resolution
guaranteeing that any Social Security fix must be permanent. The vote has
the agreement of the two senators from South Carolina, the two senators
from Texas, the two senators from Massachusetts. Anytime that happens
you've got yourself a bipartisan agreement. (Laughter.) In fact, the vote
in Congress was unanimous. Think about that. Every single United States
senator is on the record supporting a permanent fix. Now those senators
need to keep their word and make Social Security solvent once and for all.
(Applause.)

Bringing permanent solvency to Social Security is an important start, but
it's only part of our duty. Preserving Social Security should not mean
preserving its problems. Today we have an opportunity to offer younger
Americans a better deal than the current system. Today we can give every
American the chance to tap into the power of compound interest, so they can
get a higher rate of return on their money than the current system allows.
You might notice I said, "their money." See, we're not spending the
government's money. The payroll taxes are the people's money. It's coming
from hardworking people.

We can build this opportunity into Social Security by giving younger
workers the option to set aside some of their own money in a personal
retirement account. The account would be a conservative mix of bonds and
stocks that grows over time and can deliver a greater return than the
Social Security system does. That would be a good deal for younger workers.

Since 1983, since that reform took place, stock investments have returned
about 9 percent more than inflation per year, while the real return on
Social Security is about 2 percent a year. That means that a dollar
invested in the market in 1983 would be worth $11 today -- one dollar would
grow to eleven -- while the same dollar would be worth about three if it
had been put in Social Security. Every young American should have the
opportunity to take advantage of the compounding rate of interest, to earn
a better return on his or her own money.

Personal accounts would be completely voluntary; younger workers could
choose to join or choose not to join. That seems to make sense for
government to provide opportunities of choice for individual Americans.
Workers opting to open an account would be able to put about a third of
their payroll taxes in investments, instead of sending their money to
Washington. For example, a younger worker earning an average of $35,000 a
year over a career, because of the growth of money, would be able to retire
with a nest egg of nearly a quarter-million dollars. That would be a nice
addition to the other Social Security benefits.

These voluntary accounts would come with strict guidelines to make sure
they're secure. You couldn't take -- put them in the lottery -- sorry to
say, Speaker. (Laughter.) You could make sure the earnings aren't eaten up
by hidden Wall Street fees. We'll make sure there are good options to
protect investments from sudden market swings on the eve of retirement. You
won't be able to withdraw all your money and take it to the racetrack.
These accounts will offer straightforward investment choices that are easy
to understand.

By the way, this concept isn't new. After all, in South Carolina, all state
employees can choose to put part of their retirement savings in a
traditional retirement plan, or in a conservative mix of bonds and stocks
that can deliver a better rate of return. So when I talk about personal
accounts available for younger workers, you know what I'm talking about
right here in South Carolina. You've already made that decision for people
who are serving the state.

I don't know if you know this or not, but federal employees have that same
opportunity to watch their money grow, through a program called the Thrift
Savings Plan. It's a plan that allows members of the United States Congress
and the United States Senate to set aside some of their own money, if they
so choose to do so, in a conservative mix of bonds and stocks. It seems
fair to me that if setting up a personal savings account is good enough for
a member of the United States Congress, it is good enough for workers all
across America. (Applause.)

By giving younger workers an option to set up a personal savings account,
we have an opportunity to modernize and strengthen a great American
program. We have a chance to bring the Social Security system into the 21st
century.

The reason I say that is, today young people are comfortable investing in
bonds and stocks. Millions of workers now choose to plan for retirement
with their own savings accounts, through programs like 401(k)s. I don't
remember growing up hearing the word 401(k) -- I don't think you remember
that. You're old enough to be around when they didn't have 401(k)s --
(laughter) -- or IRAs. We're not talking about a new culture, we're talking
about a culture that's already taken hold in our society, where workers
from all walks of life are watching their money grow and making decisions
on behalf of their families with where they invest.

See, telling younger workers they have to save money in a 1930s retirement
system is like telling them that they have to use a cell phone with a
rotary dial. (Laughter.) If young people are confident they can improve
their retirement by investing in a conservative mix of bonds and stocks,
the government should not stand in their way.

Creating these accounts will also give our children and grandchildren a
chance to replace a burden of uncertainty with a new opportunity. Instead
of leaving their full retirement in the hands of future politicians,
younger workers will be able to take part of their retirement into their
own hands. Instead of sending all the payroll taxes to Washington, younger
workers would be able to transfer part of their money directly into an
account they own and that the government can never take away. Instead of
forfeiting years of Social Security contributions if they die before
retirement, younger workers would have peace of mind that their personal
accounts could be passed on to a loved one.

Young people are learning more about the opportunity to own part of their
retirement, and they're making their opinion pretty clear. I met Philip
Meador today. He's a graduating senior from The Citadel. He told me he's
going to be starting a new job in June. He knows he's going to start paying
Social Security taxes. What he's not sure about is whether or not he'll
ever be seeing a Social Security check. He certainly will be paying in;
he's not so sure what's going to be coming out. He likes the idea of
keeping part of his money in an account that he controls. He said, "I like
the options. You choose what to put in, you choose the investments. It
depends on what you're looking for. I think every individual should be able
to choose a plan that fits them."

A lot of young people are beginning to say that. A lot of young people want
this United States government to come together of young people want the
government to give them the option of making choices with their own money.

And I know you all feel the same way in this chamber. That's why you passed
resolutions calling the United States Congress to strengthen this important
program, Social Security, and to give younger workers the option of
voluntary personal retirement accounts. You recognize that a Social
Security system that includes personal accounts will give all Americans --
not just a few, but all Americans -- a stake in the greatest creator of
wealth the world has ever known. You recognize that personal accounts will
bring the security and independence of ownership to millions of our
citizens. And you recognize that personal accounts are critical to building
an ownership society, a more optimistic and more hopeful America, in which
more people own their own homes, more people own their own businesses, more
people have a ownership in a retirement account, more people have an asset
base they call their own that they can pass on to whomever they choose.

You see, owning assets ought not to be confined to a few people in our
society. Owning an asset and being able to pass it on to your son or
daughter ought not to be the purview of a few. In this great land, it ought
to be spread -- ownership ought to be spread to everybody who is lucky
enough to be an American. You recognize that when people own something,
they have a vital stake in the future of our country, and that personal
accounts will help give every citizen the chance, the opportunity to
realize the dreams of this land.

The legislature of this great state of South Carolina has shown leadership
on this important issue, and now the United States Congress needs to do the
same. I understand that Social Security is a tough issue, but Congress has
tackled tough issues before. We've seen in the past how leaders from both
parties can rise above partisan politics to meet great responsibilities.
And now is the time for them to do so again. (Applause.)

I am confident that members of Congress will come together to reach a
permanent solution. And when they do, our children and grandchildren will
one day look back and be grateful that our generation made the difficult
choices and the necessary choices to renew the great promise of the Social
Security system for the 21st century.

I want to thank you all for the invitation to come to your great state. I
appreciate you giving me a chance to come and visit. It's an honor to talk
about such an important topic with those who have been willing to serve.
May God bless you in your efforts, and may God bless your families, and may
God continue to bless the United States of America. (Applause.)

END 12:53 P.M. EDT

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