Social Security Political Chasm Deepens

Just when the divide that exists between Republicans and Democrats over Social Security reform couldn't possibly grow any wider, President Bush and former presidential candidate Howard Dean seem to have pushed two sides even further apart.

In separate, partisan appearances late last week, the President reaffirmed his support for private accounts and his opposition to payroll tax increases, while the chairman of the Democratic National Committee branded Bush's reform plan as a "dark, difficult and dishonest vision," the Miami Herald reports.

Both political camps agree that the 75-year-old Social Security system, one of nation's great social programs and perhaps the single-greatest prize of the Democratic Party, must be reformed before the program begins paying out more in benefits than it receives in contributions in 2017.

Democrats vehemently oppose Bush's proposal for supplementing a reform plan by diverting 4% of the 12.4% payroll tax into voluntary private accounts that would consist of a mix of stocks, bonds and mutual funds.

Dean has said his party, which hasn't ruled out a tax increase as an option to help fund the system, won't come to the reform table until Bush drops the idea. Democrats have plenty of support in their fight against private accounts from powerful groups like the AARP and AFL-CIO, which claim the only party to benefit from the accounts are the Wall Street money managers that could collect billions of dollars in management fees.

The asset management industry has stood on the sidelines while the debate rages on in Washington.

Meanwhile, outside a Hopkinsville, Ky., Christian center on Thursday, Bush urged lawmakers from both parties to come together with ideas to save the system and reassured seniors that their current benefits won't be cut.

"If you don't want anything to get done," the President jabbed at Democrats, "all you gotta do is go around the country trying to scare seniors. And then the seniors will say to the members of Congress, 'Please don't do anything.'"

Bush's remarks came on the heels of a report from the Social Security Administration's non-partisan chief actuary, Stephen Goss, who said the nation could be pinched as soon as 2009 because that's when the excess payroll taxes that are currently flowing in would begin to decline. That would mean that funding for other programs that piggyback on Social Security would need to be halted.

Before a liberal audience in Washington, Dean steamed ahead with his criticism of Bush's private accounts by pulling the messy issue of private corporate pension funds into the Social Security fracas. He cited Labor Department statistics that show that private companies under funded their pension plans last year by $450 billion. He blamed Bush.

"The President wants to take away our Social Security, and then he's going to take away the private pension plans, too?" Dean asked rhetorically.