Canton, Miss. – President Bush brought his campaign to restructure Social Security to one of the poorest states in the country to focus on what he said are the plan’s benefits for lower-income retirees rather than his call for private accounts for younger workers.
“If you work all your life and contribute to Social Security, you should not retire into poverty,” Bush said as he invoked the legacy of Franklin D. Roosevelt, who signed the legislation creating the federal retirement system. “I think that’s a principle that makes sense.”
Speaking to an audience of 2,000 factory workers at the sprawling Nissan automobile plant here, Bush cast his plan as the best way to salvage a system projected to be paying out more to retirees than it collects from workers by 2017.
He would remake the system by reducing future benefits promised to middle- and high- income workers as well as allowing workers to divert a portion of their Social Security taxes into personal investment accounts.
The changes would apply only to workers born after 1950.
Without making changes now, Bush said, future workers will be stuck either with a sharp increase in payroll taxes or even steeper declines in benefits than those he has endorsed.
Bush’s support for the plan marked the first time he has embraced a specific proposal for resolving Social Security’s long-term funding problem.
His idea was greeted with opposition from some Democrats, liberal-leaning advocacy groups and others who say the plan would place an undue burden on the middle class, many of whom rely heavily on Social Security for retirement income.
“While the proposal was described as reducing benefits for the most affluent Americans, it would result in large benefit reductions for middle-class workers as well,” said a policy brief written by Jason Furman of the liberal Center on Budget and Policy Priorities.
Bush has said that his proposal to allow workers to divert as much as a third of their Social Security taxes into private accounts would give them an opportunity – but no guarantee – to make up for the proposed benefits cuts.
Moreover, he said, the accounts would provide a tangible asset that workers could pass on to their heirs or use to supplement their regular Social Security check – or both.
