A day after President Bush unveiled more details of his Social Security reform proposal, Democrats soundly rejected the White House’s new approach to “progressive indexing,” which would allow low-income workers’ benefits to grow faster than those of middle- and upper-income workers. Sen. Chuck Schumer (D.-N.Y.), a member of the Finance Committee, predicted that even Republicans would find the President’s new idea hard to accept because it results in a future benefit cuts for everyone but low-income workers. “The President did make some changes last night, but if anything, he’s dug himself deeper into a hole,” Schumer said in a Friday conference call with reporters. “And that’s because while privatization is bad, privatization with deep benefit cuts is even worse.” Meanwhile, House Ways and Means Chairman Bill Thomas said he expected to produce a Social Security bill by June–similar to a timeline devised by Senate Finance Chairman Chuck Grassley (R.-Iowa). Thomas, who said the House bill would include more than just personal retirement accounts, wants to address the rising cost of health care for seniors. Earlier, Thomas expressed a desire to include tax reform as well. Thomas’ counterpart, Rep. Sandy Levin (D.-Mich.), said Democrats wouldn’t cooperate with Republicans as long as private accounts were part of the proposal. “The main thing that has to be removed from the table is the massive diversion of Social Security monies into private accounts,” Levin told reporters. “We have to move off the table massive borrowing. We just don’t want to do that. Also, we will not support benefit cuts of this dimension.” Added Schumer: “As for us, we are waiting for the President to take privatization off the table. We’re not going to get into any solutions here. It was not the Democrats who called this a crisis. We don’t believe it’s a crisis.” Cracks are also developing among conservatives. The Free Enterprise Fund, led by Stephen Moore, released a statement Friday urging the President to forgo Social Security reform, especially if it includes raising the payroll tax cap, which Bush has not ruled out. (Moore serves as the economic affairs correspondent for HUMAN EVENTS.) “Given the ferocity of Democratic obstructionism, Bush must be willing to accept a proud defeat, rather than pursue a ‘victory’ that would derail our prosperity,” according to the statement. “The tax reform issue, with the Mack-Breaux panel report due in a couple of months, appears to be emerging as a more fertile area for constructive, pro-growth government reform, and Bush would do well to make it the signature issue of this term.”
President's new proposal faces resistance on left and right
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