Focus Point - Two Social Security ProposalsCommentary by Pete du Pont
July 17, 2000
I'm Pete du Pont with the National Center for Policy Analysis.
Bush and gore both have plans for voluntary personal savings accounts for retirement. One's sensible. One's just politics.
By 2015, payroll taxes won't be enough to pay Social Security benefits. The government will have to raise taxes, cut benefits or borrow money. Under the Bush plan, workers could invest part of their payroll tax dollars in personal accounts. They'd get a guaranteed minimum benefit, part personal account profits, part government guarantee. Initially, it would rely more on the guarantee, but gradually workers' accounts would grow, ease the government burden, and reduce the need for a tax hike.
Gore's plan would take tax dollars from the good fund and give them to people to invest in personal accounts separate from Social Security. But this does nothing to stop the demographic meltdown of Social Security. So taxes would still have to go up, or Social Security benefits go down.
So, one plan's real, and one sounds good if you say it fast.
Those are my ideas, and at the NCPA we know ideas can change the world. I'm Pete du Pont. Next time, the Supremes strike out.