John Boehner, February 4, 2005

In his State of the Union address, President Bush said, "Fixing Social Security permanently will require an open, candid review of the options." As you can imagine, in partisan politics, "open" and "candid" are usually the last words that describe a debate about anything. Before the President’s speech even began we were inundated with information and advertisements opposing any kind of reform -- few contained an honest account of the problems we face.

In a recent column I reiterated my support for reform. This week I’d like to cut through all of the negativity and the rhetoric and get down to the guts of it. Here are some common questions and misconceptions about the ideas the President has suggested, and my responses to them.

I’m close to retirement. How will Social Security reform affect me?

It won’t. You’ll receive benefits just as you would have. The goals of reform are to strengthen the system long-term, and to give younger workers the best deal possible for their retirement.

I’m not an expert investor; won’t a personal retirement account (PRA) be too risky for me?

The history of IRAs, 401(k)s, and options like the Thrift Savings Plan available to federal government workers shows that PRAs can be structured so as to avoid scams and risky investments. Many of the most outspoken critics of reform have accounts of their own like these.

Who will benefit the most from reform?

Those who will benefit the most are workers who can’t currently afford to save, let alone invest. We already pay 12.4% of our income to Social Security; few have much money left over at the end of the month. Because PRAs belong to individual workers and not the government, they make possible for lower income people what’s previously been reserved for the wealthy: the ability to build a nest egg that can be used for retirement and passed on to family members.

Social Security has worked this long -- why change now?

Today's program is a bad deal for average workers. When President Roosevelt first pushed for old-age insurance, or what we know as Social Security, it wasn’t meant to look like it does today. In a statement to Congress on January 17, 1935, Roosevelt said, "The system adopted, except for the money necessary to initiate it, should be self-sustaining in the sense that funds for that payment of insurance benefits should not come from the proceeds of general taxation." He later added that individuals should have the opportunity to participate in "voluntary contributory annuities," and that the federal money used to pay benefits to early participants "ought ultimately to be supplanted by self-supporting annuity plans."

In other words, the President credited with creating Social Security was actually one of the early supporters of PRAs!

The program Roosevelt championed never advanced past the start-up stage, and instead turned into a pay-as-you-go system where today’s workers support today’s retirees. As President Bush noted, the more time that passes the fewer workers there are for each beneficiary (today the ratio is 3:1; it will soon be 2:1). The system will begin taking in less than it has to pay out in just thirteen years.

Thirteen years? That’s a long way off, and I read that we might have even longer until there’s a "crisis!"

Growing up I was always taught to work hard and avoid trouble. Whether or not we say there is a Social Security "problem" or "crisis" is irrelevant -- it’s evident that there’s something wrong with the current system, and we should work as hard as we can as soon as possible to fix it. Our children and grandchildren deserve nothing less.

Congressman John Boehner, a Republican, represents Ohio's Eighth Congressional District, which includes Miami, Butler, Preble, Darke, and Mercer Counties.