March 3, 2005 The President The White House 1600 Pennsylvania Avenue, NW Washington, DC
Dear Mr. President:
We write in the hope that we can achieve a bipartisan agreement to strengthen Social Security for the long term and enhance the retirement security of all Americans.
Soon after your reelection, you made clear that your Administration's top priority is to move toward the privatization of Social Security. Your proposal would cut Social Security's funding by diverting payroll taxes into privatized accounts, which would weaken the program and force deep cuts in benefits. Your Administration also acknowledged that the proposal would require borrowing trillions of dollars, much of which we know would come from foreign countries like China and Japan.
Democrats in the Congress believe this approach is unacceptable, and it appears that most Americans agree with us. Funding privatized accounts with Social Security dollars would not only make the program's long term problems worse, but many believe it represents a first step toward undermining the program's fundamental goals. Therefore, so long as this proposal is on the table, we believe it will be impossible to establish the kind of cooperative, bipartisan process we need to truly address the challenges facing the program many decades in the future.
We were encouraged that Treasury Secretary John Snow suggested that you might be willing to abandon your privatization proposal and move instead to an alternative approach in which investment accounts would be established entirely separate and apart from Social Security. As you know, many Democrats, including President Bill Clinton, have advocated just such an approach, with benefits targeted to working and middle class families who need help the most. So long as such accounts remain entirely independent from Social Security and do not put the program's guaranteed benefits at risk in any way, we believe they deserve serious consideration as part of a broader effort to promote retirement security.
While Secretary Snow's suggestion was initially encouraging, subsequent reports indicate that you remain committed to your privatization plan and his public comments were little more than a tactical maneuver. According to a story in today's Washington Post, "White House officials are privately telling Republicans that Bush is opposed to the idea [of accounts outside of Social Security], but does not want to say so because it would appear he is not willing to compromise."
Given the conflicting and ambiguous reports on such a critical issue, we urge you to publicly and unambiguously announce that you reject privatized accounts funded with Social Security dollars or otherwise linked to the provision of guaranteed Social Security benefits. Such a statement would eliminate a serious obstacle to the kind of bipartisan process that Democrats are seeking to deal with Social Security's long-term challenges and to improve the retirement security of all Americans.
Of course George W. Bush won't denounce carve outs because phase out of Social Security is the ultimate goal. This letter, however, publicly and unequivocally puts him on the spot. His carve out private accounts are funded by a percentage of current Social Security payroll taxes as opposed to the add on private accounts favored by Democrats which will be funded by sources that will not jeopardize Social Security.
But true to the misleading tradition of his Administration, Mr. Bush tries to weasel out of this one by implying that the two accounts are one and the same. At his privatization road show in New Jersey he said, "See, personal accounts is an add-on to that which the government is going to pay you. It doesn't replace the Social Security system". That's the kind of sleight of hand we have to watch out for and educate people about.
41 out of 44 Democrats plus 1 independent signed the letter. The three who didn't sign: Kent Conrad of North Dakota, Russ Feingold of Wisconsin and Ben Nelson of Nebraska. Feingold didn't get to sign the letter because his mother passed away and he was out of town, but he's a straight pro-Social Security guy. Conrad and Nelson of Nebraska are obviously members of the Fainthearted Faction who deserve to hear from their constituents ASAP.