By refocusing the debate on the benefits of individual ownership and wealth creation, Sen. Jim DeMint, R-SC, and his allies in the House, including Reps. Paul Ryan, R-Wis., and Social Security Subcommittee Chairman Jim McCrery, R-La., have rescued Social Security reform from the bureaucrats' obsession with building grandiose schemes to make Social Security appear permanently solvent on paper in perpetuity.
Democrats thus far have obstructed every effort of the president to modernize Social Security by placing it on a sound financial footing. They've denied a serious problem exists with Social Security and refused to make any suggestions for reform of their own. In one sense, though, they are correct. There is not an immediate crisis analogous to a car careening toward a cliff. The crisis is more like a small malignancy: If remedial treatment is begun early enough, radical surgery might be avoided down the road.
That is why this new effort to stop the raid and start the accounts makes so much sense. Beginning to save Social Security surpluses in personal accounts right now makes a serious down payment on solvency and buys Congress time to adjust and expand the program and achieve permanent solvency in the future. Attempting to achieve permanent solvency on paper by raising taxes, cutting benefits and hiking the retirement age will only make a bad deal for workers even worse.
If workers were allowed to save the annual Social Security surplus plus interest due and already scheduled to be paid to the trust fund, it would be possible to create personal retirement accounts equal to between 3.5 percent and 4 percent of payroll for the next 10 years. The 4 percent accounts Bush prefers would be a substantial down payment on solvency and would constitute a significant step toward more fundamental reform.
The battle for personal retirement accounts is finally forming up in Congress. I can't think of a better Fourth of July message from the president than to urge Congress to stop the raid, start the accounts and declare workers' independence through ownership of their own retirement accounts.