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May 13, 2005

Dr. No Obstructionism on Social Security

Washington observers of this week’s Social Security hearings chaired by Bill Thomas came away disappointed. Chairman Thomas got no help from his Democratic colleagues who continued their Dr. No obstructionism. Led by Charlie Rangel, the Dems attacked Pozen indexing of benefits. They attacked any benefit reduction whatsoever, even though under current law the troubled system will never deliver promised benefits. Clearly the Dems are not serious about reforming the system. The only bright spot was some Republican support for the “stop-the-raid and start savings accounts” plan that Steve Moore and I, among others are supporting. This idea would take the estimated $2 trillion of projected surpluses over the next ten years and convert them into marketable Treasury bills or TIPS that would be placed in Social Security IRAs for system members who choose this option. This is the proverbial camel’s nose under the tent. Congress would still get our money, but at least we would get ownership of real assets, a real lockbox, and only we would control the key. It’s a long shot. Mr. Thomas still hopes to get a reform bill next month. I’m rooting for him. But without any Democratic support, the chances for Social Security reform are presently slim at best.

Posted by Larry Kudlow at May 13, 2005 2:23 PM | Print

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