Bush Started Push To Privatize Social Security In 2000 Presidential Campaign

Bush Began Campaigning On Partial Privatization Of Social Security After Winning The Republican Primary. According to The Washington Times, “Texas Gov. George W. Bush, in a sign of growing confidence in his presidential candidacy, soon will begin campaigning for an idea that has long been feared as the deadly ‘third rail’ of American politics: partially privatizing Social Security. In series of upcoming speeches and policy initiatives dealing with ‘family security,’ the presumptive Republican presidential nominee plans to promote his proposal to give workers the option of putting a portion of their Social Security payroll taxes into their own private investment retirement accounts, his campaign aides said. […] Mr. Bush’s proposal, which he avoided raising during the primaries, would dramatically change the New Deal-era program by letting workers invest a part of their automatically deducted payroll taxes into stock or bond funds that would produce much higher investment returns on their contributions over their working lives than the 1 percent to 2 percent that Social Security now offers future beneficiaries.” [The Washington Times, 4/25/00]

Bush Called For “Far-Reaching” Social Security Overhaul That Would Establish Individual Retirement Accounts. According to the New York Times, “Casting the overhaul of the Social Security system as a ‘test of presidential candidates,’ Gov. George W. Bush today proposed a fundamental change in the retirement system that would allow workers to choose how to invest some of their payroll taxes. With his formal call for the introduction of individual retirement accounts, Mr. Bush, the presumptive Republican presidential nominee, began a debate that could dominate the campaign. […] Shifting some of the payroll tax into individual retirement accounts would amount to the most far-reaching change in Social Security since its inception in the Depression. As Social Security has worked for decades, current retirees are paid from the payroll taxes of current workers; under the Bush plan, workers would be able to use a portion of their payroll taxes and invest them for their own retirement.” [New York Times, 5/16/00]

Bush Avoided Specifics, Leaving Questions About Who Would Be Affected By His Proposal And Its “Significant” Costs. According to the New York Times, “But the lack of specifics on matters like what percentage of payroll tax would go to accounts and what age group would see the change opened Mr. Bush to charges that he was masking some of the hard choices ahead and trying to sidestep questions about how he could afford the transition as well as his sweeping call for a $1.3 trillion tax cut in the next decade. The costs of making the transition to such a system would be significant — as much as $1 trillion — because the government could have to pay out full benefits to current retirees at the same time that some amount of payroll taxes were being diverted into individual accounts.” [New York Times, 5/16/00]