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Democrat Mulling Support for Social Security Reform Plan
Christine Hall
Staff Writer
(CNSNews.com) - Rep. Harold Ford (D-Tenn.) is weighing a plan to reform Social Security using personal retirement accounts -- a move that would put him at odds with all the Democratic presidential candidates and the party's congressional leadership.
His only concern, Ford confides, is how to pay the transition costs in moving from a pay-as-you-go system to individual investment accounts.
"I like the concept," Ford said of a reform plan that has not yet been introduced. The author of the plan is Rep. Jim DeMint, a free market Republican from South Carolina. "How we pay for it is the central challenge," Ford said.
"Without a doubt, if we continue down the path we're going, we're going to face [a] wreck here in the coming years that is easy to avoid now," said Ford. "The challenge with DeMint's bill now is that it takes some up-front money. And with all of these challenges on the table that cost money... how do you pay for it?"
Social Security's actuaries have predicted mounting deficits starting in 2018. That's the year that Social Security benefits paid out will begin to exceed incoming payroll tax revenue.
But transitioning to a system of personal accounts, a concept endorsed by fellow Democrats Charlie Stenholm (D-Texas) and the late Daniel Patrick Moynihan, among others, will also cost trillions of dollars.
The price tag on DeMint's forthcoming plan reportedly is $8.2 trillion over 75 years, compared to an estimated $26.1 trillion for making no change to Social Security.
But the Democratic Party's presidential candidates and congressional leadership don't see it that way. They warn that workers won't have enough investment know-how to grow their savings accounts or that the market will crash, devastating the accounts.
Just last week, for example, Rep. Dick Gephardt (D-Miss.) blasted his rival Howard Dean who, in the past, has suggested raising the retirement age to 70 (rather than the currently scheduled hike, from age 65 to 67).
Gephardt indicated that the party can ill afford a candidate that strays from the party line on social issues. "Next year, when our party has chosen its nominee for president, there needs to be a clear choice on issues like retiree health care and protecting Social Security and Medicare," Gephardt said.
Dean, for the record, has since backtracked, saying the retirement age should remain as is.
DeMint said he is delaying introduction of his reform bill in the hopes of resolving Ford's concerns.
"Hopefully we can introduce it with a Democrat this time," said DeMint.
Ford "will have to do a lot of defending of a plan like this," DeMint acknowledged, pointing to past elections in which Democrats "bashed us all over the head" over Social Security.
"I think he's courageous enough to go out on a limb," DeMint said of Ford.
Ford said that so far, no one from the Democratic leadership has pressured him not to back DeMint's reform effort. "My leadership hasn't said a word to me about it," Ford said.
His only concern, Ford confides, is how to pay the transition costs in moving from a pay-as-you-go system to individual investment accounts.
"I like the concept," Ford said of a reform plan that has not yet been introduced. The author of the plan is Rep. Jim DeMint, a free market Republican from South Carolina. "How we pay for it is the central challenge," Ford said.
"Without a doubt, if we continue down the path we're going, we're going to face [a] wreck here in the coming years that is easy to avoid now," said Ford. "The challenge with DeMint's bill now is that it takes some up-front money. And with all of these challenges on the table that cost money... how do you pay for it?"
Social Security's actuaries have predicted mounting deficits starting in 2018. That's the year that Social Security benefits paid out will begin to exceed incoming payroll tax revenue.
But transitioning to a system of personal accounts, a concept endorsed by fellow Democrats Charlie Stenholm (D-Texas) and the late Daniel Patrick Moynihan, among others, will also cost trillions of dollars.
The price tag on DeMint's forthcoming plan reportedly is $8.2 trillion over 75 years, compared to an estimated $26.1 trillion for making no change to Social Security.
But the Democratic Party's presidential candidates and congressional leadership don't see it that way. They warn that workers won't have enough investment know-how to grow their savings accounts or that the market will crash, devastating the accounts.
Just last week, for example, Rep. Dick Gephardt (D-Miss.) blasted his rival Howard Dean who, in the past, has suggested raising the retirement age to 70 (rather than the currently scheduled hike, from age 65 to 67).
Gephardt indicated that the party can ill afford a candidate that strays from the party line on social issues. "Next year, when our party has chosen its nominee for president, there needs to be a clear choice on issues like retiree health care and protecting Social Security and Medicare," Gephardt said.
Dean, for the record, has since backtracked, saying the retirement age should remain as is.
DeMint said he is delaying introduction of his reform bill in the hopes of resolving Ford's concerns.
"Hopefully we can introduce it with a Democrat this time," said DeMint.
Ford "will have to do a lot of defending of a plan like this," DeMint acknowledged, pointing to past elections in which Democrats "bashed us all over the head" over Social Security.
"I think he's courageous enough to go out on a limb," DeMint said of Ford.
Ford said that so far, no one from the Democratic leadership has pressured him not to back DeMint's reform effort. "My leadership hasn't said a word to me about it," Ford said.
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