Bush Bets His Future on Social Security

With his approval numbers headed for the dumpster, President Bush on Thursday attempted to break a political deadlock on overhauling Social Security with a proposal to limit the growth in future benefits for wealthier Americans and protect the benefits of low-income workers.

“This reform would solve most of the funding challenges facing Social Security,” Bush said at a rare, prime-time news conference amid falling poll ratings for his handling of Social Security, high gasoline prices, the economy and Iraq.

Hoping to jump-start negotiations with lawmakers and win over skeptical Americans, Bush said he wanted to ensure that “future generations receive benefits equal to or greater than the benefits today’s seniors get” but offered no details.

A Bush aide said later that future benefits under this proposal would continue to grow but at a slower pace.

Bush made his proposal, part of the biggest overhaul of the retirement system since its 1935 inception, in his first prime-time news conference in a year, one that was moved forward a half hour to satisfy network complaints that the original timing would conflict with lucrative advertising plans.

Bush brushed aside his sagging poll numbers, saying, “You know, if a president tries to govern based on polls, you’re kind of like a dog chasing your tail.”

He stood his ground on his choice for ambassador to the United Nations, saying John Bolton’s no-nonsense style would be an asset in pushing for reform at the world body. Democrats have accused Bolton of abusive behavior in past jobs and say he is unsuitable for the diplomatic post.

“John Bolton’s a blunt guy. Sometimes people say I’m a little too blunt,” he said.

Bush acknowledged there was little he could do to address soaring gasoline prices. He said his administration would encourage oil producers with excess capacity to maximize production, guard against price-gouging and work toward long-term solutions.

On Iraq, he put a sunny face on the situation there despite rising violence, praising the formation of an Iraqi government and saying U.S. commanders were optimistic Iraqis ultimately will be able to provide for their own defense and allow U.S. forces to return home.

Hoping to regain the initiative in the Social Security debate, Bush backed an idea offered by a Democratic expert, Robert Pozen, who proposed “progressive indexation” of Social Security benefits as a way to extend its solvency.

“I propose a Social Security system in the future where benefits for low income workers will grow faster than benefits for people who are better off,” Bush said.

He refused to back off his signature proposal for private retirement accounts that Democrats are trying to kill, saying they must be part of any package.

But for Americans concerned about investing in the stock market, he also proposed a relatively safe investment option for private accounts, one invested entirely in U.S.-backed treasury bonds.

Pozen, chairman of MFS Investment Management, told the Senate Finance Committee on Tuesday his plan would close the long-term deficit of Social Security by more than 70 percent, from a present value of $3.8 trillion to about $1.1 trillion.

He also said his plan would not begin until 2012 in order to preserve the scheduled benefits of current retirees and those nearing retirement.

Bush did not endorse all the details, saying it would be a matter for negotiations with Capitol Hill.

Under the plan, future growth benefit increases for wealthier people would be limited by tying growth in benefits to prices rather than wages. Benefits to low-income people would remain tied to wages and stay the same.

Some experts have argued against the plan by saying it would result in cuts in benefits to average workers.

The news conference comes at the end of Bush’s 60-day effort to highlight the financial problems facing Social Security and promote his plan to create private retirement accounts.

An ABC News-Washington Post poll on Tuesday said that 64 percent of Americans did not approve of the way Bush was handling Social Security, 57 percent did not like his stewardship of the U.S. economy and 54 percent disapproved his energy policy.