Robert Novak

WASHINGTON -- George W. Bush, who is not prone to confessing mistakes, has confided to close associates that he committed a whopper on Social Security. He admitted error in pushing for new personal accounts while not stressing the repair of the safety net for seniors. As a result, Republicans returned to Washington this week from the congressional recess deeply shaken by what they encountered back home.

 Thanks to the orchestrated effort of the AARP and organized labor even in the most Republican districts, GOP lawmakers encountered angry opposition to President Bush's plans at town meetings. These pressure groups have overwhelmed the campaign for personal accounts by planting fear among 50-something voters. Republicans face a dilemma: strengthening the safety net means higher taxes and lower benefits that would make the package unpalatable to members of Congress from both parties.

 For many Republicans, the Bush Social Security bill is beginning to look like a bridge too far. They would like to abandon what they see as an impossible quest. However, the president is committed -- a commitment that now is not limited to personal accounts but necessarily includes basic revision of how Social Security is financed and distributed.

 Sen. Lindsey Graham, a first-term Republican senator from South Carolina, has taken the lead in searching for a bill that would attract a few Democrats who are essential for passage. Three months ago, he proposed raising above $90,000 the amount of individual income subject to the Social Security payroll tax in order to pay "transition costs" for personal accounts. That brought down the conservative house on Graham for "negotiating with himself."

 Many things have happened since then. Bush said that raising the tax cap is on the table. Graham's package is a work in progress, including a cut in the payroll tax rate from the current 12.9 percent to 11.9 percent to accompany raising the cap above $90,000. He would also change the indexing for Social Security benefits to the inflation rate, replacing the much faster rising wages -- a 30 percent cut in benefits. All this will be necessary eventually to save the system without even adding personal accounts. For now, such personal pain would make possible the pleasure of using 4 percentage points of the payroll tax for personal accounts.

 I find some Republicans who denounced Graham three months ago have moved closer to him. Indeed, some would reduce benefits more than he does in the upper income brackets. Others would establish a means test to end benefits for the rich. All this would establish a graduated Social Security system that might please some Democrats sufficiently to sell them on personal accounts.

Robert Novak

Robert Novak (1931-2009) was a syndicated columnist and editor of the Evans-Novak Political Report.

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