Panel proposes personal accounts for Social Security
WASHINGTON (CNN) -- A presidential commission studying ways to reform Social Security on Tuesday unanimously approved a set of three recommendations that would allow workers to shift some of their contributions to the retirement fund into personal investment accounts.
The three options will be forwarded to President Bush for his review. The commission has projected s that each options on its own would not be enough to cover the full costs of the Social Security program, and could require billions of dollars more from the government to help keep the system afloat.
The commission did not give preference to any of the three options, each of which would allow workers to contribute to private accounts that could invest in stocks or bonds. Some options, the commission noted, could lead to lower benefits.
But commissioners did suggest that Congress, which must ultimately approve any changes, study the recommendations for at least one year before making a decision.
Bush made Social Security reform a top item of his campaign for president last year, and created the President's Commission to Strengthen Social Security in May to find solutions to the what has been termed an impending Social Security crisis.
Social Security is endangered because it is expected to start paying out more in benefits than it collects in payroll taxes as the large baby boom generation enters retirement age, raising questions about its long-term viability.
Some Democrats wasted no time in blasting the commission's report.
"This is a product that, in my judgment, is dead on arrival here in the United States Congress," said Sen. Byron Dorgan, D-North Dakota. "This conclusion will not be embraced by anyone who's seriously thinking about the future of Social Security, how to stabilize it and how to make it healthy for the long term."
"I think in this Enron economy, this proposal is dead in the water," said Sen. Paul Wellstone, D-Minnesota, referring to the financially plagued energy-trading company whose stock collapsed in recent weeks. "I don't think there will be much interest at all in this privatization scheme."
Sen. Rick Santorum, R-Pennsylvania, and other Republicans praised the commission's report, saying it offered the possibility of a Social Security solution without raising payroll taxes on future workers.
"This is a commission that has given direction, and has said that this is the responsible way to head forward," Santorum said. "It has given us a fairly narrow road, if you will, to travel."
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