    [Public Papers of the Presidents of the United States: George W. Bush (2005, Book I)]
    [February 3, 2005]
    [Pages 133-146]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks in a Discussion on Strengthening Social Security and a Question-
    and-Answer Session in Great Falls, Montana
    February 3, 2005

        The President. Thank you all for coming. Thank you all for being
    here. Go ahead and have a seat. Thank you. Nice to be in the part of the
    world where the cowboy hats outnumber the ties. Thanks for coming. Gosh,
    it's wonderful to be back in Montana. What a fabulous State, full of
    really decent, honorable people.
        Conrad, thanks for introducing me. I'm glad
    you didn't auction me off. [Laughter] Doing a fine job in the United
    States Senate, and I'm proud to call you friend. Thank you very much,
    sir.
        And I want to thank Max Baucus for being
    here. We have worked a lot together in 4 years. You know, we've
    confronted a lot of things in this country. We've confronted a recession
    and confronted the need to get this economy growing. And Max worked hard
    with the administration to cut taxes and open up markets. And I
    appreciate working with you, Max. It's been a lot of fun. We got more
    work to do.
        We're here to talk about an issue, after a while, that's going to
    remind us we got a lot of work to do if we're going to do our duties as
    public servants. But Max, thank you. Denny
    Rehberg, thank you, friend, for coming.
    I'm honored you're here--proud of the United States Congressman from the
    great State of Montana--and Jan.
        The Governor met me at the airport. The
    Governor is here. Governor, thank you for coming. I'm proud you're here.
    One of these days you're going to join the same club as me and
    Judy and Marc
    Racicot--that's the ex-Governors club. But right now, you may have the
    best job in America, being the Governor of a great State. So I'm proud
    you're here. Lieutenant Governor is with
    us today. We got a lot of other officials--secretary of State--thanks
    for coming.
        You know, we're flying over on Air Force One, and guess what
    Burns and
    Rehberg--all they wanted to talk about was cattle--

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    [laughter]--Montana beef. And that's an important subject because it's
    part of how to make sure our economy continues to grow. They kept
    asking, ``Are you talking to markets overseas to get the Montana beef
    into those markets?'' I said, ``You bet I am.'' And we'll continue to do
    so.
        One of the reasons I worked with Max on free trade is because I
    believe when we open up markets for products, U.S. products, Montana
    products, people are going to more likely be able to find a job. We want
    to be selling stuff you grow here and stuff you produce here all around
    the world. And so I want to tell Max and
    Denny and Conrad,
    we're going to still be opening up markets.
        They also had a few other things on their mind. They wanted to talk
    about energy. Last night I said to the United States Congress--I said we
    have been debating energy long enough. It is time to get a sound energy
    plan to my desk so we can become less dependent on foreign sources of
    energy. People in Montana know something about energy. I know that.
        They said also, ``Make sure you keep in mind the needs of the rural
    health--hospitals and docs.'' You've got some rural issues here in
    Montana because you've got a lot of land--[laughter]--and not a lot of
    people. [Laughter] That's the way a lot of folks probably want to keep
    it too, I suspect.
        If you want to have health care available and affordable, we've got
    to do something about these lawsuits that are running good doctors out
    of practice. We've got a problem in that these lawsuits are making it
    costly for docs to stay in business and are hurting the Federal budget
    too. When you're afraid of getting sued, you practice defensive
    medicine. In other words, you prescribe more than you need to, just in
    case you have to go to a court of law. And that runs up the cost of
    Medicare, Medicaid, veterans benefits. So I've come to the conclusion
    that the medical liability issue is a national problem that requires a
    national solution, and I call upon Congress to pass real, meaningful
    medical liability reform.
        Before we talk about Social Security, I do want to talk a little bit
    about the amazing times we're living in. Just think about what has
    happened in the last 4 months. There was an election in Afghanistan.
    Millions--millions--of people voted for a leader, voted for a
    President for the first time in 5,000 years. I
    don't know who's counting, but that's a lot, you know. I mean, it's an
    amazing story, when you think about it. It wasn't all that long ago that
    the Taliban was providing safe haven to Al Qaida in Afghanistan, and
    that's where they plotted and trained. That's why we went in, to rout
    them out.
        We said if you harbor a terrorist, you're equally as guilty as a
    terrorist. The doctrine still stands. And the reason the doctrine still
    stands is because there's an enemy that still hates what we stand for.
    We will stay on the offense. No matter where they hide, where they run,
    the United States of America and coalition forces will be after them to
    keep us safe.
        That is our duty. That's the responsibility of the Federal
    Government. And I want to thank those who wear our uniform for serving
    this great country of ours. But the lesson of Afghanistan should remind
    us we've got a greater force at our disposal than just our military, and
    that is our belief in the ability of freedom to change societies.
        And we saw it. The high school students and college students here
    are watching some amazing history unfold. Think about what you've seen.
    You saw people vote in Afghanistan to elect a President. You saw people vote in the Ukraine to elect a
    President. You saw people vote in the
    Palestinian Territories to elect Abu Abbas [Abu Mazen].* And you saw last Sunday some incredibly
    brave people in Iraq defy the

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    terrorists and cast their ballots by the millions, because of freedom.
    ---------------------------------------------------------------------------
        * White House correction.
    ---------------------------------------------------------------------------
        Freedom is powerful. Freedom is incredibly powerful. I believe that
    freedom is embedded in everybody's soul. That's what I believe. I
    believe that given a chance, people will vote, and people will adhere to
    the rules of self-government. It's not easy in parts of the world,
    though, where there's terrorists and tyrants trying to stop the march of
    freedom. And the reason they are, and the reason they're trying to stop
    the march of freedom is because they think the exact opposite. They
    believe in control of people's lives. They don't believe in freedom of
    religion. They don't believe in freedom of speech. They don't believe in
    freedom of the press. They don't believe in freedom, period. And we do.
    That's why we're still a target, but that's why we'll prevail in the
    long run, because deep in everybody's soul is that deep desire. And you
    know why I believe it's deep in everybody's soul? Because I believe it's
    the Almighty God's gift to every soul on the face of the Earth.
        You about ready, Leo? Let me say one other
    thing. They asked me--you know, I've been asked, and they say, ``Is
    there a timetable of withdrawal from Iraq?'' Here's the answer to that.
    You don't set timetables. You don't want the enemy to say, ``Okay, we'll
    just wait them out.'' The timetable is, as soon as possible. And it's
    going to be based upon the willingness and the capacity of the Iraqi
    troops to fight the enemy. And so our mission--our mission is to provide
    training and command structure and officer training to the Iraqis so
    they can defend their own freedom. That's what they want to do. I talk
    to their leadership all the time. And like any independent free country,
    they want to defend themselves, and our job is to help them defend
    themselves. And when they do, and when they're ready, our troops will
    come home with the honor they have earned.
        And as freedom spreads in parts of the world that have not known
    freedom, our children and grandchildren will more likely grow up in
    peace. And that's what we want. We want to spread the peace.
        Let me talk about Social Security. You know, people say, ``Gosh,
    that's a pretty tough issue to be bringing up. We've got a war to fight.
    Why are you bringing up Social Security?'' Here's why: The job of the
    President is to confront problems, not to pass them on to future
    generations or future Presidents. That's the way Montana people think:
    If you see a problem, go fix it. Don't theorize, don't pontificate, but
    fix it. And so the question is, do we have a problem?
        First of all, let me explain why I think we--I know we have a
    problem. When Social Security was designed, there were 16 workers for
    every beneficiary in 1950--actually, designed in the thirties. In 1950,
    there were 16 workers for every beneficiary. That meant it was a lot
    easier to afford that which the Government promised. When you've got 16
    people paying in for one person, it--you can see why the system was
    solvent.
        What's happened since the design of the system, however, is that
    people are living longer, thankfully. [Laughter] That's good news.
    [Laughter] What else is happening since the system was designed is we
    had what's called the baby boomers. That would be me, Baucus, others,
    you know--[laughter]--people whose hair is getting grayer on a regular
    basis. And we're fixing to retire in big numbers. So you're living
    longer and you've got bigger--you've got big numbers retiring and fewer
    workers paying into the system, 3.3 workers per beneficiary. Plus,
    Congress over the years has promised an increase of benefits. So think
    about the math: Fewer people paying into the system, more people living
    longer, more people retiring, for greater benefits.
        Now, that is--and because Social Security is a pay-as-you-go system,
    there's not a great big trust of money. The money that goes in from your
    paycheck goes out to the beneficiaries. That's how it works.

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    And so, obviously, as the demand for money increases as a result of more
    people retiring and people living longer and benefits going up, more has
    to come in.
        Now, if you look at this chart up there, in 2018 the Social Security
    system goes negative. That means more money is going out than is coming
    into the system. And every year after that, as you can see, the cash
    deficit--that is, the money going out is greater than the money coming
    in--increases. In 2027, it's about $200 billion a year. That's above and
    beyond the payroll taxes we're collecting. Ten years later, it's about
    $300 billion. Every year, the situation gets worse.
        So you can imagine what will be happening if we don't do anything.
    You know, Congress is going to show up, and somebody says, ``We're $200
    billion short. Where are you going to get the money?'' Well, you can tax
    somebody to get the money; you can get rid of the benefits that you
    promised; you can cut other programs; or you can keep borrowing debt.
    That's why I think we've got a problem.
        Now, before I start talking about what I intend to do about it, I've
    got to make some things just as plain as I can. If you're a senior
    citizen today on Social Security, you don't have to worry about it. The
    trust has got plenty of money to take care of you. I understand how this
    issue works. Everybody says, ``He's talking about Social Security; there
    goes my check.'' That's what happens all the time when they're talking
    about Social Security. You're in good shape. And if you're near
    retirement, 55 years or above, you're in good shape. Nothing changes.
    Those are the facts.
        The problem is, is that the younger workers have got a problem. And
    I think we have a duty to worry about our children and our
    grandchildren. You know, 2018 may not--may seem like a long way down the
    road for people who are running for office every 2 years. It's not that
    far down the road. If you've got a 5-year-old child, that child will be
    18 years old before you know it, and the Social Security system starts
    losing money. In 2042, the system will be broke. Again, for some of us
    in politics, that may seem like ages. You know, ``Don't worry about it;
    2042 seems like forever.'' And in my case, of course, I'm not going to
    be around in politics. I'm moving on after 4 years. But nevertheless,
    it's not that far. And the longer you wait, the harder it is to fix the
    problem.
        So my judgment is--and that's why I went in front of Congress
    yesterday and said, ``Okay, let's fix the problem.'' And I put all ideas
    on the table, except for running up payroll taxes. If you've got a good
    idea, bring it. No President, I don't think, has ever said that when it
    comes to Social Security. Some of you veterans may remind me whether
    that's the case or not. I don't think so. I'm willing to stand up with
    the Congress. I don't care if it's a Republican idea, Democrat idea,
    independent idea; bring them forward. Let's work together and fix the
    system.
        There are a lot of ideas out there--[applause]--thank you all.
    There's a lot of ideas out there. I mentioned some of the authors of the
    ideas last night. I've got one myself that I think is a very interesting
    idea, along with others. What I'm about to tell you will not permanently
    fix Social Security. By the way, there's no need just to put a Band-Aid
    on the deal. If we're going to get after it, let's fix it permanently.
    Let's let people look back generations from now and say, ``I appreciate
    the way the Congress and the President worked together to do what was
    right on Social Security.''
        Let me give you an idea that I think is worth considering. I thought
    it was worth considering so much, I put about five paragraphs in my
    speech into it, you know. [Laughter] And it's this: I believe you ought
    to be allowed to take some of your own money, payroll taxes, and set up
    a personal retirement account on a voluntary basis. And the reason why I
    believe that is because the rate of return in your account

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    will be greater than the rate of return on the money you're getting in
    Social Security. And that's important because, if you're a younger
    worker and set aside some of your money that would normally be going
    into the trust into a personal account, over time that rate of return
    grows and accumulates. And you end up with a nest egg, I guess is the
    best way to put it, a nest egg that will then complement your Social
    Security checks when you finally retire.
        Now, there's a lot of questions about this, of course. Can you take
    it to the lottery? Is that considered an investment? Can you take your
    payroll taxes and set up a fund and go to the lottery or the track or
    shoot some dice? The answer is no--[laughter]--obviously. You have to
    have a conservative mix of stocks and bonds. And there are a lot of
    funds that are conservatively tailored so you can get a reasonable rate
    of return. Obviously, the lower the risk, the lower the rate of return.
    But it's going to be a rate of return greater than that which you're
    earning in the Social Security trust, and that's important over time.
        Secondly, you just can't, once you retire, pull it all out. In other
    words, there will be a phased withdrawal in order to make sure that the
    Social Security benefits you get, coupled with the money coming out of
    your own personal account, is done in such a way as to help you retire.
        Third, there are ways to make sure your fund can avoid swings in the
    market at the very end of--right before you retire. So there's some wise
    things we can do, just like we do for the Federal Government employees,
    see? They've got this plan; it's called the Thrift Savings Plan. My
    attitude is, if it's good enough for people working in the Federal
    Government, it ought to be good enough for people working elsewhere in
    America.
        I like the idea of you owning something. I love an ownership
    society. We want more people owning their own home. We want people
    owning their own business. We want people owning their own farm. We want
    people owning and managing their own health care accounts. And I think
    it makes sense to have people owning and managing their own retirement
    accounts.
        So we're going to talk about Social Security. And by the way, this
    will be phased in. I know they're throwing out all kinds of numbers--1
    trillion, 2 trillion, 3 trillion. When you get to the Federal
    Government, we--it's no longer millions or billions; it's trillions at
    the Federal Government. It's amazing, isn't it? Anyway, we're going to
    phase it in. This doesn't all happen at once. I think it's important to
    gradually phase in the idea of personal accounts so younger workers can
    get used to it and so that the plan is more affordable, so it's more
    fiscally sound, fiscally responsible to fade it in. And we put out such
    a plan that will help people understand that we can do this without
    busting the budgets. And that's important for people to understand as
    well. No, this is doable. It's just going to take some political will.
        Now, I want to talk to somebody who professes to be an expert.
    Actually, he is an expert. We were in Fargo earlier, and he handled
    himself brilliantly for a professor--no. [Laughter] Jeff Brown from the University of Illinois knows the subject
    well. He is obviously a good sport. He takes a pretty good needle. But
    tell us--just give us--back me up. You've studied the issue. [Laughter]
    Now, I've come here, and they say, ``What do you expect the President to
    say?'' Put some expertise out there.
        Jeffrey R. Brown. Happy to do so, Mr.
    President. And thank you very much.

    [At this point, Dr. Brown, assistant professor, Department of Finance,
    University of Illinois at Urbana-Champaign, Champaign, IL, made brief
    remarks.]

        The President. What was the life expectancy when Franklin Roosevelt
    designed the program--or Congress--60, maybe? I think it was 60.

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        Dr. Brown. Back in the mid-1930s, a
    person born in the United States could expect to live, on average,
    around 60, low 60 years old.
        The President. See, that's how the system was designed: pay-and-you-
    go as you work, people not living very long. It's changed. The world has
    changed. The system hasn't changed with it. And that's what we're
    talking about.
        You got any other thoughts, Professor?
        Dr. Brown. Sure, I'll go on as long as
    you let me. [Laughter]
        The President. Reminds me of my college days. [Laughter]
        Dr. Brown. I'm used to having an hour
    and 20 minutes with an audience that can't leave.
        The President. When I was awake. [Laughter]
        Dr. Brown. The other thing, I just----
        The President. Talk about the personal accounts. I know--it
    obviously makes some people nervous. It's a new idea. It's a new
    concept. People--all of a sudden, when you take a system like Social
    Security that's been around so long and it has done a lot of really--
    made a big difference in people's lives, and you throw out a new idea--
    it's the world in which the status quo sometimes is the easy default
    position. And--give us some thoughts on that.

    [Dr. Brown made further remarks.]

        The President. So Leo Keller is with us. He
    said, ``Do you mind if I wear my hat?'' I said, ``Not at all, Leo.''
    It's a fine-looking hat. Thanks for wearing it. I'm glad you're here.
    Welcome. Leo, you're here to talk about Social Security. Give us some
    wisdom.

    [Leo Keller, retiree, Bozeman, MT, made brief remarks.]

        The President. Yes, that's a really interesting idea. What
    he just said is very important. Once people get
    into the habit of savings, it encourages other savings. This society has
    changed. Leo, first of all, a couple points. One, you made my point on
    life expectancy. [Laughter] You're looking strong at 79, headed to 80.
    You're doing great.
        Mr. Keller. Thank you.
        The President. Secondly, it is important for Leo to know that nothing changes. There are a lot of people
    out there saying they've heard the Social Security debate--``I wonder
    really if this means I'm not going to get my check.'' I cannot--I'm just
    going to say it again and again and again. Matter of fact, this is stop
    two of five where I'm traveling around the country; I know I've got a
    lot of explaining to do. And one of the most important explanations of
    all is Leo is going to get his check. Nothing changes. The system is
    sound. Any discussion about younger workers does not mean that Leo and
    anybody like Leo is not going to have this promise that the Government
    made. That's just really important to know.
        And thirdly, you're right about your grandkids. See, I like a
    guy who says, ``My grandkids are capable of
    owning and managing something.'' It's a different mindset. The 401(k)s,
    for example, have changed the attitude toward investment, hasn't it? I
    mean, a 401(k), when you were coming up, Leo, was just three numbers and
    a letter in the alphabet. [Laughter] And now it's an idea, where people
    manage their own retirement and they own something. They see it; it's
    visible. It's an important part of our society today, and it seems like
    to me, as we modernize the system of Social Security, we incorporate a
    portion of that new system into the concept of somebody owning
    something.
        So thanks for coming, Leo. You did a fabulous
    job. And the hat--listen, I'm telling you----
        Mr. Keller. My pleasure.
        The President. Those women look at that hat and that club, and
    they're going wild.
        Kelly Kost--Kelly, thanks for coming. What do
    you do?

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        Kelly Kost. I am in sales and administration.
    I work for Mission Mountain Les Schwab Tires in Ronan, Montana.
        The President. Ronan?
        Ms. Kost. Ronan, yes.
        The President. How many people live there?
        Ms. Kost. I have no idea. [Laughter]
        The President. Either do I. [Laughter]
        Ms. Kost. Not a clue.
        The President. At least you know where it is. [Laughter] Talk talk
    about Social Security. First of all, Kelly has
    got the hardest job in America. She's a single mom.
        Ms. Kost. I've been a single mom since 1989.
    My twins are 18 years old, Jade and Jordan.
        The President. Where are they? Yes.
        Ms. Kost. Jordan is a member of the Army
    National Guard.
        The President. There you go.
        Ms. Kost. Jade will be the valedictorian of
    her class----
        The President. There you go. Your mom is
    humiliating you, but it's good to know. Very good.
        Ms. Kost. Yes. And they will both be entering
    college this fall.
        The President. Fabulous, Mom. You're doing
    your job.
        Ms. Kost. Thank you--thank you.
        The President. Listen to your mother.
    [Laughter] I'm still listening to mine.
    [Laughter] Let's talk about Social Security.

    [Ms. Kost made brief remarks, concluding as follows.]

        Ms. Kost. I'm just wondering how user-
    friendly these will be.
        The President. Yes, that's a fabulous question. There are a lot of
    people who are comfortable with making investments; there are some
    people who are just worried about it--you know, is it hard? And the
    answer to the question is, it will be incredibly user-friendly. It's got
    to be, because the options will be limited. The key is to allow people
    to have their own account that gets a better rate of return than the
    money in the current system. And over time, that will inure to your
    benefit.
        And you can do that with a very conservative mix of stocks and
    bonds. The professor talked about--doctor
    or professor, which one--either one? Yes, okay. How about ``Jeff''?
    Anyway--[laughter]--he talked about the Thrift Savings Plan for Federal
    employees. There are five options, and it spelled out what the options
    are. In other words, you're not going to have to go in and pick stocks.
    You'll pick a group of stocks or a group of bonds or a mixture of them.
    And they'll be described to you. So yes, it's very user-friendly. And
    that's a very good question.
        The other questions I get are, can you just jerk your money out at
    any time? No, this is a retirement fund. It's meant to help you after
    you retire. The benefits of this idea is, one, it gets a better rate of
    return. It just will. Over time, you'll hear, ``Well, the stock market
    will crash and therefore I'll lose all my money.'' Well, first of all,
    if you study the history of investments over a 15- or 16-year period of
    time, there's always been a positive return. Now, there may be a down
    year, but over time, we're talking about, you get a positive return. And
    there are investment vehicles that would help deal with any market
    decline. But we're talking about a mix, a conservative mix of stocks and
    bonds. And that's an important question.
        Now, the other benefit, of course, is that it's yours. Your Social
    Security benefit is simply a promise. You don't own it; the Government
    will decide. If the Government can't pay for it, the Government says,
    ``Well, we're going to reduce your benefits.'' When you have your own
    personal account, it's yours. The Government cannot take it away.
        And you can give it to whatever child you decide--unless you get mad
    at them and then give it to somebody else. [Laughter] But it's--and
    that's an important concept about--when you talk about ownership. We're
    talking about a better rate of

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    return on your money, something you own that cannot be taken away, and
    something you can pass on from one generation to the next. And that's an
    important concept. Young families ought to be thinking about, obviously,
    saving to pass on from one generation to the next. I don't see why we
    can't incorporate that into the Social Security system because I know it
    can work financially. As a matter of fact, it makes the system more
    sound. It makes it more likely a younger worker is going to end up with
    that which the Government has promised. And that's important.
        Speaking about young couples, Amy and Mike
    Borger are with us. Welcome.
        Amy Borger. Thank you.
        The President. Where do you both live?
        Mrs. Borger. We live in Great Falls.
        The President. Yes, right here, a beautiful town full of great
    people. I was touched by the number of people who came out and waved,
    and I thank them for that.
        Do you have children?
        Mrs. Borger. We do. We have our daughter,
    Jordan, is 12, right down in the front. And our son, Shane----
        The President. There she is, Jordan,
    waving. That's good.
        Mrs. Borger. ----is 2. And we're expecting
    our third baby in April.
        The President. Awesome, yes. Georgia--you're going to name it
    Georgia? No. [Laughter]
        Mrs. Borger. No.
        The President. I don't blame you. [Laughter] Tell me about your
    ideas on Social Security. Thoughts, worries, concerns?
        Mrs. Borger. I guess we're in a unique
    position in our life. I'm fortunate enough to still have my four
    grandparents living. It's very important to me that the system that has
    been promised to them continues to be the same for them. Looking for
    our--my husband and myself, we want to make sure that when we're ready
    to retire, the system is what has been promised to us as well as for our
    children. And we appreciate the chance to be given an opportunity to
    have a hand in that with the personal accounts.
        The President. Yes, thanks. If you look over your shoulder, which
    you've already done--you can actually look right there--you'll see it's
    not going to be around unless we do something now. These good folks are
    in the danger zone unless Congress acts, because the cash deficits
    increase every year starting in 2018. That's an important date for
    people to remember. They may argue in Washington--it may be 2019, or
    2018 and a half. It's happening, is the point. And it gets worse every
    year. I repeat to you--in 2027, we're looking for 200 billion extra
    dollars to pay what has been promised. I don't know how Congress is
    going to deal with that in 2027 unless we act now.
        And we need to think about young families. You're a high school
    librarian?
        Mrs. Borger. I am.
        The President. You lucked out, buddy. I
    married a school librarian too. [Laughter]
        Mike Borger. It can be hard at times,
    can't it?
        The President. No, not at all. [Laughter] Well, if it has, I'm not
    confessing publicly. [Laughter]
        What do you do?
        Mr. Borger. I'm a supervisor at
    Poulsen's. It's a home improvement center here in Great Falls.
        The President. Great, good, good. [Applause] Some of your fellow
    employees are here. That's good. They probably want a personal account
    as well.
        Mr. Borger. A good friend of mine that I
    work with, his son is serving in Iraq right now.
        The President. Where's he--where is--where's Dad? Appreciate it. E-
    mail your son, we're proud of him. It had to make you feel good, Dad,
    last night when the Iraqi lady hugged the mom of the fallen marine. I
    know it made her feel good. It was a show of gratitude from the Iraqi
    people that said, ``Thank you for our freedom.

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    Thank you for the sacrifice.'' Your son is serving a noble cause, sir--
    security of America and peace to the world.
        I'll tell you something really interesting that Amy is doing, by the way. We'll get to Social Security in a
    minute--kind of meandering around. [Laughter] Amy is into distance
    learning. Where do you go?
        Mrs. Borger. Boise State University.
        The President. From your living room?
        Mrs. Borger. From my living room.
        The President. Interesting thought, isn't it? The reason I bring
    that up is, obviously education is vital for the future of the country.
    No Child Left Behind is working. We're going to keep it strong; we will
    not undermine it. On the other hand, we've got to be wise about how we
    use technology. Think about that: The education system has changed;
    Social Security hasn't. Anyway, education--here she is going to get a----
        Mrs. Borger. Master's in educational
    technology.
        The President. Yes, from your living room. Pretty cool, isn't it?
    We've got to keep those kind of--keep these ideas moving. And Boise
    State has done a good thing to allow you to do that.
        All right, Mike, back to Social Security.
    Do you think you'll ever see anything?
        Mr. Borger. I hope to.
        The President. Yes. It's an interesting question--I just want to
    stop you--I promise you're going to get more than two words in here.
    [Laughter] It may be hard to tell. [Laughter] Doesn't that kind of worry
    you when the young guy says, ``I hope to?'' [Laughter] When old
    Leo was his age, he
    said, ``No question.'' Are you going to see a Social Security check?
    ``No doubt.'' Now we've got youngsters saying, ``I hope so,'' as if
    there is doubt, and there should be doubt.
        Mr. Borger. My wife and I work very hard
    for what we earn. And we have a lot of bills and--daycare and two
    children and a third on the way--and it's hard to set money aside to
    start our own IRA and that stuff. So we're very dependent on what Social
    Security or the personal accounts can offer. So it's real important to
    us that something gets reformed and things change so that there is a
    guarantee for us and our children. And also, it's a concern to me that
    people like Leo and my in-laws and my parents and friends of mine that
    are coming upon the age that they retire, that their Social Security
    that they worked very hard for won't be touched----
        The President. Right.
        Mr. Borger. ----and that that will be
    there for them.
        The President. It will be. And I can't guarantee for you; that's
    what we're here to discuss.
        See, I'm traveling around because, first of all, I believe in the
    will of the people. I believe that people can influence policy. And so
    the next couple of months, I'm going to be traveling the country,
    telling people I think we've got a problem and asking people to get
    involved. Nothing changes for Leo, but this couple that's about to be
    raising three kids is--they're going to have a system that's just not
    going to work unless this United States Congress and the President act
    together.
        I believe it's going to happen. I really do. Oh, the pundits will
    say it looks too tough, and this--somebody said it's not going to
    happen, and somebody opined it's not going to happen. But when the
    people really figure we've got a problem, they're going to demand a
    solution. They're going to say to members of both political parties,
    ``What the heck are you doing in Washington, DC, if you're not willing
    to settle down and solve the problems facing this generation?''
        I'd like to answer a few questions if you've got any. I'm sure
    somebody has got a few. Yes, sir, with that shirt on. Fine-looking shirt
    you got there. Thank you all for coming out, by the way. It's a joy to
    be here.

    [[Page 142]]

    Retirement Age

        Q. Mr. President, do you foresee that if we fix this program, we can
    move the retirement age back to 65? For some people it's 66, 67, 68, and
    on and on.
        The President. Yes. Well, there's a lot of discussions about whether
    we ought to move it back or move it forward, and that idea is on the
    table. Again, this is one of those ideas where, in the past, if you
    talked about it, somebody would club you over the head with it in a
    political race. And I think we ought to debate whether or not the age
    ought to be 65, 66, 67. These are for younger workers now--nothing
    changes for older workers. And that's on the table; that's what I said
    last night. I reminded people that my predecessor, President
    Clinton, suggested that that might be
    part of a solution, to raise the retirement age. But I don't think you
    can end up making that decision now until you look at all the other
    options. And we're just going to have to take the hard look at all the
    different options on the table. And people are living longer--but this
    all, again, pertains to younger workers. And it's--it will be part of
    the debate that goes on in Washington, DC. And I'm willing to have it.
        Yes, ma'am. Just can barely stand it. [Laughter]

    Benefits for the Disabled/Prayer/Religious Freedom

        Q. Sir, you are a blessing, and our family prays for you every day.
        The President. Thank you. Thank you for saying that.
        Q. My husband and I are privileged to have a 35-year-old daughter
    who is mentally disabled, and she works hard in a supportive living
    center in Helena, Montana. And many people against your proposal are
    trying to scare the disabled by saying they will lose their Social
    Security----
        The President. Not true. Nothing changes.
        Q. ----which she needs. So is she okay?
        The President. Nothing changes when it comes to the disabled--the
    disability aspect of Social Security. This is all aimed--all discussions
    about the retirement aspects of Social Security. I'm glad you asked
    that.
        Thank you for your prayer.
        I tell people this: I don't see how a President can do the job
    without the prayers of the people. I know other Presidents probably
    wouldn't agree with that, necessarily. I quoted Abraham Lincoln today.
    He said, ``I would be,''--I think--I kind of paraphrased him. We
    actually had the National Prayer Breakfast this morning. Started off by
    saying the State of the Union was kind of like a prayerful session: They
    were praying I'd hurry up and finish the speech. But it's--[laughter].
    Anyway, I quoted Abraham Lincoln, who said, ``I don't see how you can be
    President without prayer,'' is what he said. And I agree with that
    assessment. One of the most powerful--[inaudible]--of the Presidency is
    to know that people are praying for me and Laura.
    And I want to thank you for that.
        Having said that, I also want to--I know there's a lot of talk about
    religion and politics. It is essential that whoever the President is and
    whoever is in Congress always honor the fact that in this country, you
    can pray or not pray and be equally American. You can be a religious
    person or not a religious person and be equally viewed as a patriot. And
    if you're religious, you're equally American if you're a Jew, Christian,
    Muslim, Hindu. That's the greatest thing about our country. That's what
    distinguishes us from the Taliban, is the freedom to be--the freedom to
    choose what you want to choose.
        You've got a question? All right, thank you.

    Personal Retirement Accounts

        Q. Mr. President, I was reading in a liberal newspaper today--
    [laughter]----
        The President. Sounds like a loaded question to me. [Laughter]

    [[Page 143]]

        Q. ----an opinion was that, on the average, individuals would make
    about 6\1/2\ percent on the market over time and that that was less than
    what is being made in the Social Security system.
        The President. No, that's--I don't want to ascribe a political
    label--I would describe as somebody who doesn't know what they're
    talking about. [Laughter] That's just not the truth. Professor?
        Dr. Brown. That's what I'm here for, is
    to find the truth.
        The President. Thank you, sir. Thank you. Thanks for coming.
        Dr. Brown. Yes, historically, over the
    last 80 years, the stock market has returned about 7\1/2\ percent over
    inflation, and that's far higher than you get from Government bonds or
    on the return from the current system.
        The President. No, but he's not talking about the return within the
    Social Security system, and it's, like, near zero.
        Dr. Brown. It's about 1 to 2 percent
    for----
        The President. And the difference between a 1-percent return on your
    money and 4-percent return on your money over time is significant?
        Dr. Brown. Yes. Just to give you an
    idea of the difference between--suppose you invested $1,000 a year from
    the time you're in your early twenties until you retire. Suppose you get
    a 3 percent rate of return, you might have about $65,000. Get a 7
    percent rate of return, you're going to have over $200,000. So it's a
    very big difference.
        The President. That's how money grows. And that's an important
    concept that we need to incorporate if we want the Social Security
    system to be available for younger families and younger workers. It's a
    really important part of a reform package.
        Okay, any more questions? I'm kind of winding down here because I've
    got to head on to Nebraska. Yes, ma'am? The red shirt.

    Livingston, Montana

        Q. I have one--[inaudible]--I'm from Livingston, Montana. I kind of
    have one question for you.
        The President. Sure.
        Q. Can you quote Proverbs 17:17 for me?
        The President. Do what?
        Q. Can you quote Proverbs 17:17 for me?
        The President. No. [Laughter] That's an easy one. Can you? Quote it.
        Q. ``A friend loves at all times, and a brother is born for
    adversity.''
        The President. Thank you. Very good. I thought you were going to ask
    me if I knew how to get to Livingston. [Laughter] It's like that guy
    said, ``What color''--he said, ``To get to Livingston, you've got to go
    down the highway, and you go through the cattle guard, and you''--
    [laughter]--``turn left, and you go through another cattle guard.'' And
    a fellow comes back and says, ``Hey, what color uniforms do those cattle
    guards have on?'' [Laughter] That never happens in Montana.
        Yes, sir.

    Exercise/Personal Retirement Accounts

        Q. Thank you, Mr. President, for coming to Montana.
        The President. Nice to be back. Big Sky.
        Q. When my wife and I continue to pay into the system, what
    percentage of that will we have the opportunity----
        The President. Yes.
        Q. ----to invest in? And what kind of mountain bike do you ride?
    [Laughter]
        The President. I'm not supposed to endorse products, but it's called
    a Trek. [Laughter] Are you a mountain bike guy?
        Q. Yes, I am.
        The President. Oh, listen, let me--I'll get to the--I'll try to
    remember what--the real question you asked. [Laughter] First of all, I
    hope people exercise on a regular basis. It's--I can't tell you how
    important it is for you. Unfortunately, I exercised too hard for a while
    and can't run anymore, but

    [[Page 144]]

    I did discover mountain biking. This has got to be fabulous mountain
    bike country, right?
        Q. It is.
        The President. Yes. Unlike, you however, I'm a safe mountain biker.
    I'm looking at--you look like a risktaker, you know? [Laughter] Like
    ride those little tiny trails--that's not me. [Laughter]
        Now, I really--the best health care plan--one of the aspects of the
    best health care--any good health care plan is to encourage right
    choices. What you put into your body matters, and how you treat your
    body matters. And so I--thank you for bringing up--giving me a chance to
    segue into exercise. As a matter of fact, prayer and exercise are what
    keeps me going as--[laughter]--as the President--and family and friends,
    especially Laura.
        The way the system works--in order to make it work fiscally, is that
    you can start off with $1,000 into your account, growing $100 a year up
    to 4 percent of your income. That's the answer to your question. The
    idea is ultimately there will be--if you're making 90,000, you can put
    3,600 a year into your personal account. That's how you keep it more
    affordable than the numbers that have been being tossed about.
        Yes, ma'am. Good to see you again.

    Medical Liability Reform

        Q. Hi, how are you? As usual our prayers and love are with you. But
    I could have several questions. One of them, though, going----
        The President. Just ask an easy one.
        Q. It is. [Laughter]
        The President. Kind of getting late in the day.
        Q. The medical--it's a medical issue.
        The President. Yes.
        Q. With the frivolous lawsuits, one of the problems, too, is that
    attorneys charge so much to bring even a fair lawsuit to the court
    system that the victim, the patient winds up with nothing and the
    attorney winds up with all the money.
        The President. Right.
        Q. And the doctor is being run out of business. Can that somehow be
    worked in there?
        The President. I don't believe that--no, I'm--I just--I guess I
    could give you a political answer and say I'll think about it. I
    actually don't think the Government should regulate legal fees. I think
    that ought to be set by the market, so to speak. I don't think
    Government ought to set price. I do think Government, though, can set
    limits for lawsuits that--that are filed.
        And the thing in medical liability reform that I think will make a
    big difference is to have a hard cap on noneconomic damages. In other
    words, you're allowed to get economic damages, but the noneconomic
    damages need to have a hard cap, which will reduce the desire for people
    to keep filing lawsuits as if the medical liability system were a
    lottery. But in terms of whether or not the Government ought to be
    setting legal fees, I don't think so. I don't think so.
        Let's see, a couple of more, then I've got to hop. Yes, ma'am. Boom.
    [Laughter]

    Personal Retirement Accounts

        Q. Thank you, Mr. President. We're excited to have you for another 4
    years, and we stayed up half the night waiting for the election results.
        The President. Yes, thank you. [Laughter] Thanks. Well--[laughter].
        Q. My question is, as this privatization of Social Security comes
    into effect, who will manage that? Has that been talked about at this
    point?
        The President. I would call it personal retirement accounts, is the
    proper terminology, because it basically means you own it. See,
    privatization says the whole thing changes--not true. A portion, as I
    said, 4 percent ultimately, of the money that you earn can go into a
    personal account that you call your own. Who manages it? You

    [[Page 145]]

    do. You make the decisions. You make the--on that aspect. The Social
    Security Administration will still exist for the other aspect of Social
    Security. It's a mixture. It's a blend. In other words, part of your
    money goes into the system and the Government will pay out benefits.
    Part of your money goes into your own personal account, which you will
    manage. You will get, on a quarterly basis, your statement about how
    much of your money has grown over--and how has it grown over a period of
    time. But the other portion of the Social Security will continue to be
    managed by the Federal Government, the Social Security trust.
        How about the little guy in the hat? Number seven.

    Request for Handshake

        Q. Can me and my friend shake your hand?
        The President. Yes. Move on over here. Okay, last question. Have you
    got a question? You don't have a question. You want to shake my hand,
    stay right there. I'm coming down.
        Yes, ma'am.

    Personal Retirement Accounts/Small Business

        Q. As an employer of a small business, I have to express a concern.
    How will employers handle these deposits for our employees?
        The President. The Federal Government will be the administrator to
    make sure that the accounts are properly set up.
        Q. Wonderful.
        The President. This is--this can be done without a lot of additional
    paperwork. Again, this is a--the purpose is not to create excess
    bureaucracy--quite the opposite. The purpose is to empower individuals
    and that the employer won't be charged with making sure that the
    paperwork is managed properly.
        Let me talk about small businesses real quick. The tax cut that
    Max and I and Conrad and
    Dennis--Denny worked on is really
    important for small businesses. That's why it's really important we not
    allow taxes to go up. Seventy percent of new jobs are created by small
    businesses in America. And I'm proud to report the small-business sector
    of our country is strong and vibrant and doing well, and we need to keep
    it that way.
        Thanks for being an entrepreneur. Are you staying in business?
    That's good.
        Listen, let me conclude by thanking you all very much for your
    hospitality, your generosity of your time, and your strong love for our
    country. We are lucky people to live in the greatest country on the face
    of the Earth.
        May God bless you all, and may God continue to bless our land.

    Note: The President spoke at 3:55 p.m. in the Four Seasons Arena at the
    Montana ExpoPark. In his remarks, he referred to Senator Conrad Burns of
    Montana; Janice Rehberg, wife of Representative Dennis R. Rehberg; Gov.
    Brian Schweitzer, Lt. Gov. John Bohlinger, and Secretary of State Brad
    Johnson of Montana; former Governors Judy Martz and Marc Racicot of
    Montana; President Hamid Karzai of Afghanistan; President Viktor
    Yushchenko of Ukraine; President Mahmoud Abbas (Abu Mazen) of the
    Palestinian Authority; Keith Reeves, whose son Spec. Jedidiah Reeves,
    MARNG, is serving in Iraq; and Janet Norwood, mother of Sgt. Byron
    Norwood, USMC, who was killed in Iraq on November 13, 2004, and Iraqi
    citizen and political activist Safia Taleb al-Suhail, both of whom were
    guests of the First Lady at the President's State of the Union Address
    on February 2. A portion of these remarks could not be verified because
    the tape was incomplete.

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