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Bush: Personal accounts can work


Photo
EVAN CARAVELLI / Arizona Daily Wildcat
President Bush addresses a panel of commentators at the Tucson Convention Center yesterday during a town hall-style speech as part of his nationwide tour in support of reworking Social Security.
By J. Ferguson
Arizona Daily Wildcat
Tuesday, March 22, 2005
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Bush campaign pushes for permanent fix

President Bush brought his 60-city, 60-day campaign to change Social Security yesterday to the 17th stop, the Tucson Convention Center.

Approximately 1,500 people packed TCC to attend the private, invitation-only town hall discussion on Social Security. The crowd, most who received their tickets from local congressional offices, cheered enthusiastically as Bush unveiled a broad plan to use personal accounts to alleviate a future Social Security crisis.

Bush was cautious to assure the hundreds of retirees in the audience their Social Security benefits will not be changed under his proposed plan.

"If you are a person receiving a Social Security check, nothing is going to change." Bush said. "The safety net is in good shape for people born before 1950."

The president suggested for those born after 1950, there are holes in the "safety net" Social Security provides. By 2018, projections suggest Social Security will become insolvent with more money going out in payments than collected in taxes.

Bush blamed the insolvency on a "trifecta" of problems plaguing Social Security: the retirement of millions of baby boomers, the rising life expectancy of retirees and better retirement benefits than previous generations.

Bush suggested the use of personal savings accounts could be the cure for the ailing Social Security system. He said the accounts would be a mixture of stocks and bonds workers under 55 years old could invest a portion of their payroll taxes in. Payroll taxes are collected to pay for Social Security benefits.

The proposed plan would be similar to the federal thrift plan, which allows federal workers to invest in a handful of conservative portfolios.

Bush used the example of a worker making $35,000 a year. If allowed to invest one-third of payroll taxes from the age of 21 to retirement age, a person would save a $250,000 for their retirement.

"The rate of return you are getting now is abysmal compared to a mix of conservative bonds and stocks," Bush said.

After a 20-minute speech on the merits of personal saving accounts, Bush spent the rest of the hour discussing Social Security with five guests pre-selected by his staff.

One of the panelists, Mary Margaret Raymond, said she studied Social Security at the UA in the 1940s. The 84-year-old told the crowd that as a public administration major, she had to learn the basic principles about the New Deal program.

"We learned the basic principles of the Social Security act," Raymond said. "And except for the tinkering they have done, it hasn't changed much. That's not good."

Raymond urged her generation to "get off of your stick and quit worrying," and said Bush has promised not to touch benefits for their generation.

Bush also discussed his last-minute trip from his Texas ranch to Washington, D.C., to sign a bill that may extend the life of a brain-damaged Florida woman, Terri Schiavo. Her husband Michael Schiavo has been in a legal battle with her parents to remove his wife's feeding tube.

"Democrats and Republicans came together and gave Terri Schiavo's parents another opportunity to save their daughter's life." Bush said. "It's a complex case with serious issues. But in extraordinary circumstances like this, it is wise to always err on the side of life."

Pete Seat, a theatre arts senior and College Republicans state chairman, said he was thrilled to see the president in Tucson.

Seat said he admired the president for tackling the thorny issue of Social Security.

"All too often, you have problems that officials like to kick down the road. They want the next generation take care of that problem," Seat said. "President Bush isn't that kind of leader."

Seat said during a 1999 visit by President Bill Clinton, he said the same thing about Social Security, calling it a crisis.

"But it's not a crisis for the Democratic Party today," Seat said sarcastically.

Seat said 50 College Republicans showed up at 8 a.m. to volunteer for the event.

Alicia Cybulski, a political science senior and president of the UA Young Democrats, said she was glad she went but felt personal accounts were not the answer.

"While private accounts are voluntary, it still takes money from the Social Security fund as a whole." Cybulski said.

Cybulski said while she recognizes the program may need to be updated, it was irresponsible to take money out of Social Security during a time of record deficits.



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