[Public Papers of the Presidents of the United States: George W. Bush (2005, Book I)]
[February 10, 2005]
[Pages 199-213]
[From the U.S. Government Publishing Office www.gpo.gov]
Remarks in a Discussion on Strengthening Social Security in Raleigh,
North Carolina
February 10, 2005
The President. Thank you all for coming. Thanks for coming. Okay.
Thanks for the warm welcome. We got a lot of work to do here. [Laughter]
Audience member. [Inaudible]
The President. Yes, thanks. Okay. Listen, we're here to talk about
an important subject. And I want to thank some of our
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fellow citizens for agreeing to join me up here on the stage. It's not
easy, frankly, to go from kind of a quiet civilian life to agree to sit
up here with the President and all the cameras. [Laughter] But I think
you're going to find this to be a very interesting dialog about Social
Security.
I've got some things I want to say before we talk about Social
Security. First, I send greetings from Laura. On
the way out she said, ``When you get down to North Carolina, tell
everybody hello, and make sure that the panelists get to talk.''
[Laughter] She knows me well. [Laughter]
I know that Elizabeth Dole helped set up
this event. I am--she is staying back in Washington because there are
crucial votes coming up. I believe that one of our--an important
initiative, and that is to bring reasonable legal reform on class-action
lawsuits, will pass. So she and Senator Burr are staying back to vote. I
hope you excuse them. I certainly did. [Laughter]
I'm also pleased that a person who set an example of what it means
to be a person who sticks to his principles and is a fine United States
Senator has joined us, Senator Jesse Helms.
Thank you for coming. Proud you're here. It sounds like to me they still
remember you. [Laughter]
I want to thank the statewide officials who are here. They were
bravely standing at the base of Air Force One when I arrived, and the
wind was blowing hard, but they nevertheless stuck it out and greeted
me. I want to thank you for being there. I want to thank the local folks
who are here.
I met a fellow named Jim Van Strien. He's
what I call a USA Freedom Corps volunteer. He works for the RSVP
program. He's been helping to welcome U.S. service men and women home.
He's the kind of fellow who--[applause]--let me finish, and then you can
thank him. He's the kind of fellow who's taken time out of his day to
volunteer to make somebody else's life better.
Now, the strength of this country is the fact that we've got
millions of citizens who are willing to do so. The true strength of
America is we've got people of open hearts and great spirit who are
willing to make society a better place as a result of volunteering. If
you're interested in serving our country, feed the hungry, find shelter
for the homeless, put your arm around somebody who hurts and say, ``I
love you, Brother, or Sister.''
Jim, thank you for setting such a good
example, and welcome.
The world is getting more free, and therefore, a future generation
of Americans and kids around the world is more likely to live in peace.
I hope you are as enthused as I am about what has happened recently in
the course of world events. Think about the elections in Afghanistan.
Millions of people voted for the first time in ages for a
President. And the first voter was a woman. And
that's miles away from a time when people were tormented by ideologues
of hatred called the Taliban. And the world is better off when a part of
the world that has longed for freedom sees a free society emerge in
Afghanistan.
And then there was an election in the Palestinian Territories. And
I've been impressed by President Abbas's willingness to stand and say, ``We must defeat terror
and establish a democracy in order to achieve peace with our friend
Israel.'' And I look forward to working toward peace in that part of the
world.
And then we had the elections in the Ukraine, and--which are a
beginning of a--a continuation of a democracy movement in a part of the
world that hadn't known freedom for ages. And then of course, some--a
week ago last Sunday, against all odds and defying all expectations,
millions of Iraqi citizens said, ``We will not be terrorized. We want to
be free,'' and they went to the polls.
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Freedom is on the march. And my job and the job of the United States
of America, with our friends and allies, is to continue to promote free
societies, because I understand freedom equals peace. And I believe we
have an obligation, as we protect our homeland from terrorist thugs, to
make the world a more peaceful place for generations to come. And I'm
looking forward to the challenge. I'm looking forward to going to Europe
in a couple of weeks to say, ``Listen, we share a lot of values. We
believe in human dignity, human rights. Most of all, we believe that
every soul should be free.''
I laid out in my Inauguration Address what I think is a noble goal
for generations to come, to end tyranny in our world. And the United
States of America, working with friends and allies, over time has got
the capacity to do so.
One of the challenges we face is how to make sure this economy of
ours continues to grow. The national unemployment rate is down to 5.2
percent. The unemployment rate here in North Carolina is lower than the
national unemployment rate. That's all good. But we must continue to
make sure that we advance reasonable economic policy so the
entrepreneurial spirit is strong, small businesses can flourish, and
most importantly, people can find work.
I'm looking forward to working with Congress to put reasonable plans
in place to make that happen. One of the most important things that I've
done in the new term is to submit a budget that says, ``Let's address
the deficit.'' I've heard from business leaders, entrepreneurs, small-
business owners, Republicans, Democrats, Congressmen, Senators--all say
we got an issue with the deficit. I said, ``Fine. I have a
responsibility to submit a budget.'' I did. It's lean. It's focused. It
sets priorities, and it says if we've got programs that aren't working,
let's get rid of them for the sake of the taxpayer.
And I'm looking forward to the deliberations, and I'm looking
forward to working with people on both sides of the aisle to get a lean
budget out. That's what the American people expect, and that's what I'm
going to sign.
I'm looking forward to working with Congress to continue to make
sure health care is available and affordable. One of the ways to do that
is, we need medical liability reform out of the United States Senate.
It's important for people to receive justice when they're harmed, but
it's important for the scales of justice to be balanced. And the scales
of justice are not balanced. Too many doctors are getting sued by
frivolous lawsuits, which is running up the cost of medicine, which is
costing taxpayers money, which is driving good doctors out of business.
It is time for the United States Congress to pass national medical
liability reform.
I'm looking forward to working with Congress to get an energy bill
out. We've been debating energy for 4 years. We don't need any more
words on energy. It's time for them to get a bill to my desk. I have
laid out a blueprint on how to get there. It encourages conservation. It
encourages the use of renewable sources of energy. It says, ``Let's--why
don't we be wise about the use of nuclear power.'' I believe we can
expand safe nuclear energy. I know we ought to be exploring in
environmentally friendly ways for natural gas here in the continental
and in the State of Alaska. All of this is aimed to make us less
dependent on foreign sources of energy. And Congress needs to act and
get a bill to my desk.
On taxes, I'm looking forward to getting the bipartisan commission's
report to me on how to simplify the code. But in the meantime, I know
this: We got to make the tax relief we passed permanent. We ought not to
be running up taxes on entrepreneurs.
I look forward to working with Congress on education matters. I will
not let the United States Congress roll back the reforms of the No Child
Left Behind Act.
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The No Child Left Behind Act is challenging the soft bigotry of low
expectations. We're raising standards. We believe every child can learn,
and we expect every school to teach. And we want to know, in return for
our money, whether or not schools are meeting expectations.
And I know you've got a fantastic community college system here in
North Carolina. And I intend to make sure that the workforce programs
utilize this fantastic community college system so people are able to
get the skills necessary to fill the jobs of the 21st century. And so
we'll continue to work with Congress on education matters.
But I'm here to talk about an issue that is going to be an
interesting experience in dealing with the Congress. [Laughter] And that
is Social Security, formerly known as the third rail of American
politics. [Laughter] That meant if you touched it, there would be
certain political death. I believe the job of a President is to confront
problems and not pass them on to future Presidents and future
generations. That's what I believe. [Applause] Thank you. Thank you all.
Okay, thank you. Thank you for the warm welcome.
I see a problem, and I want to discuss with you why I see a problem.
For those who got to worry about the politics of Social Security, let me
just give you my perspective. I ran on it twice. [Laughter] I said,
``Elect me, and I will do the best I can to work with Congress to
strengthen the system for all. Give me a chance to be the President, and
I will take the issue head on.'' I did so in the 2000 campaign.
Obviously, the issue wasn't solved, and so I did it again in 2004. I
believe candidates are rewarded, not punished, for taking on tough
issues. I say that to give assurance to the Members of Congress who may
feel somewhat fearful of taking on the issue.
Secondly, I intend to campaign on this issue around the country.
This is one of two stops today. Right after my State of the Union speech
I went to five States, and I'm going to keep traveling the country
talking about the problem of Social Security, assuring seniors that
nothing changes and saying I'm willing to discuss all options with
Members of the United States Congress. And I'm looking forward to it. I
like to get out of Washington. I like to talk to people. But I also know
that when the people speak, people in the Congress listen. So I'm kind
of sharing with you a little bit of my strategy about how to move this
issue forward.
So what's the problem? The problem is, is that Social Security--the
basic assumptions of Social Security are shifting dramatically from when
Social Security was founded. In 1950, there were 16 workers per one
putting money into the system, which means that when somebody retired,
there's 16 workers contributing to that person's retirement. Today,
there's 3.3 workers contributing for each beneficiary. And when
youngsters retire, it's going to be 2.1--2 workers per beneficiary. In
other words, the burden of paying for retirees is increasing on workers.
That's part of the equation.
The second thing that has changed is, is that life expectancy has
changed. It used to be 60 years was life expectancy; today, it's 77. I
suspect over the next decade, it will continue to increase. I certainly
hope so. [Laughter] As well baby boomers are getting ready to retire.
That's me and you. [Laughter] And do you realize, today, for example,
there are 37 million people receiving Social Security benefits; in the
year 2031, there will be 71 million people. Those are baby boomers. Baby
boomers are living longer. And more people are retiring. So part of the
equation is, more people will be receiving benefits longer than
anticipated when the system was first set up.
Thirdly, benefits promised to people like me are dramatically higher
than benefits given to today's retirees. Politicians, over time, say,
``We'll just--elect me, I'll increase the benefits.''
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So when you think about it, when you add up the equation, you've got
more people living longer, receiving greater benefits, being supported
by fewer people. And to me, that says we got a problem. And as a matter
of fact, the numbers say that. There is a chart over here that says
``Cost of Inaction,'' because in 2018, the system goes red. That means
there's more money going out of the system than coming into the system.
The leading edge of baby boomers are retiring; they're living longer;
benefit structures are bigger; fewer people paying in; the system goes
negative.
Now, some of you probably think there is a kind of--a bank, a Social
Security trust bank. But that's not what's happened over time. Every
dollar that goes into Social Security has been paid out, either to
retirees or Government programs. It is a pay-as-you-go system. It is a
flow-through system. There is no kind of--[inaudible]. There are empty
promises, but there's no pile of money that you thought was there when
you retired. That's not the way the system works.
To make matters worse, as more baby boomers retire, as people live
longer, as more benefits kick in, the cash deficit increases. So for
example, in 2027, the Government is going to have to come up with $200
billion more to meet the promises that we've made, above and beyond
payroll taxes. Every year from 2018 to when the system goes broke in
2042, the cash deficits required to meet promises increase. That says to
me we've got a problem.
Now, I know 13 years doesn't sound like a lot--2018--it may seem
like a lot to people whose perspective is maybe 2 years. But as I told
you, I think we've got to anticipate problems, particularly on this
issue, because the longer we wait, the more difficult the solutions
become. That's just a fact.
And so step one of my strategy is to continue saying to the American
people, ``We have got a serious problem.'' In other words, sometimes
they say, ``Is it serious? Is it a crisis?'' Look, whatever you want to
call it, just look at the chart, and you come up with the conclusions.
It is serious because if Congress says no to the President, we're not
going the move forward on this. Imagine what the solutions will be when
the 200 billion hits, or the 210 billion a year, or the 300 billion. I
mean, you're looking at either major tax increases, major cuts in
benefits, major cuts in other Government programs, or massive debt. And
so now is the time to move, and that's what I'm saying to the Congress.
The second goal of mine is to make sure our people who have retired,
our senior citizens, and people who were born before 1950 know that
nothing changes. That's important for you to understand. I fully
understand a lot of people are very dependent upon their Social Security
check. And when they hear somebody like me saying we're going to
strengthen the system, their immediate reaction in some cases is to go,
``Oh, that means I'm not going to get my check.'' You might remember
those campaigns around, which I'm sure you've seen them in States where
people say, ``Elect somebody, and he's going to take away your check.''
That happened to me, for example. They said, ``Old George W. gets in;
you're not going to get your check.'' Fortunately, they got their check
after I got in, so they kind of rung hollow in 2004.
You'll hear the same kind of thing being put out there, that seniors
need to worry about this. And I'm going to spend a lot of time assuring
people who've retired or near-retired that nothing changes. The system--
when we talk about insolvency, the insolvency issue doesn't relate to
you. It relates to your grandchildren. And that's the issue we're
confronted with: What do we do about the retirees' grandchildren? As I
said in my State of the Union, we have an obligation to do what others
have done for my generation, and that's to leave a better world behind.
And that's why I was willing to dedicate as many words as I did in the
State of the Union to what
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used to be the third rail of American politics, Social Security.
Now, it's one thing to define the problem; it's another thing to be
a part of the solution. And I have an obligation as the President not
just to define the problem but to encourage dialog by putting out some
ideas of my own. I stood up in front of the Congress and said, ``In
order to truly fix it, in order to have a permanent solution, all
options are on the table, except for running up payroll taxes.''
And that means a lot of different things. Democrats, like Senator
Moynihan, who Senator Helms served with, had
some really constructive ideas as to how to address the root cause of
a--of the problems with Social Security. President Clinton had some ideas; former Democrat Congressman Tim
Penny. And the ideas range from raising the
retirement age to delaying benefits to calculating benefits not based
upon wage increase but price increase. A little esoteric here, but in
other words, there's some serious ideas on the table to how to
permanently fix Social Security.
And that's why I said to the Congress, ``All ideas are on the table,
and if you got a good idea, bring it forward.'' Now is the time for
people from both sides of the aisle to address the problem. And I'm
willing to listen to anybody's idea. And I'm looking forward to a good,
constructive dialog about how to seriously address the problem, making
sure that those who've retired have nothing to worry about and, at the
same time, making sure there's a Social Security system for younger
people coming up.
I put out some ideas, and I want to talk about one of them that I
hope you find interesting. I certainly did, otherwise I wouldn't have
put it out. [Laughter] And that is, as a way to allow younger workers to
more nearly--or come closer to the promises that have been made but
can't be fulfilled, we should allow younger workers to take some of
their own money, their own payroll taxes, and set it aside as a personal
retirement account. This is a novel idea for Social Security, but it's
not--it's a novel idea for Social Security. It is not a novel idea for
Federal employees. There is such a thing that's called a Thrift Savings
Plan, which allows Federal employees to take some of their own money and
invest it in stocks and bonds so as to increase their retirement
benefits.
And why does that happen? Because when you're able to get a rate of
return on money invested, over time that money grows, that money
accumulates, that money expands. And so I believe younger workers ought
to be allowed to set up a personal account and invest in stocks and
bonds so that their money can increase faster, at a faster rate than
that which their money increases in the Social Security system. That's
what I believe ought to happen.
And so--that's called the compounding rate of interest--just trying
to show off a little bit, kind of--[laughter]--not bad for a history
major. [Laughter] Let me give you an example of what I'm talking about.
By the way, our plan is one where I believe we ought to phase in the
accounts so they're more affordable, so that the transition costs are
more manageable to get to such accounts. I believe ultimately a worker
ought to be allowed to put 4 percent of the payroll tax aside as a--4
percent of the 12--as a--in the personal account. So money stays in the
system, but money also would be allowed to grow with interest. Your
option, by the way. Younger workers shouldn't be forced to do this.
Younger workers--if you're interested in this, you can do so.
Now, if you're a worker who earns $35 [$35,000] * a year over your
lifetime, and this system were in effect where you could put 4 percent
of your payroll taxes in a personal account, and you start at age 20, by
the time you retire, your personal account would grow to $250,000.
That's compounding rate of interest.
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* White House correction.
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A couple of guidelines that need to be--I mean, you just got to
understand there will be guidelines, like there are for the employee
thrift--Federal employee Thrift Savings Plan. There's got to be--you
can't say, let's have a good retirement system, and let somebody take
their money down to the lottery and invest it. That's not a wise
investment, with all due respect to the lottery players. In other words,
there's got to be a--certain guidelines, a conservative mix of stocks
and bonds. We don't want people taking their money and investing in
high-fliers. There's a way to manage risk and get a better return than
that which is in the Social Security trust. I mean, there's all kinds of
people that are expert at this.
As a matter of fact, that's what the Thrift Savings Plan does, is
says, ``Here are some options for you, easy-to-understand options,''
which will defy those who say certain people aren't capable of
investing--a concept which I totally reject, by the way. The person with
the $250,000 account couldn't take it all out the moment he retires or
she retires and spend it. In other words, there's a--there would be a--
guidelines for a drawdown.
You see, the money coming out of the personal account is to
complement the Social Security money, however much is still available
after the congressional reforms. So it's a complement to Social
Security. It is to mirror. It's to help out. It's to enable you to
retire.
There's other benefits, however, to a personal account, besides
growing faster than the money if it were to stay with the Federal
Government. One, it's your money. And that's an interesting idea, isn't
it? It's your money to begin with, and it's your money at the end. And
you can do with it what you want. You can't take it to the lottery. You
can't gamble. You can't try to increase it with silly investments, and
you can't pull it all out at once. In other words, you have to use it
for retirement. On the other hand, if you choose not to spend it, you
can pass it on to somebody you choose.
Obviously, I didn't listen to Laura.
[Laughter] I've got some other things to say real quick.
The current system today--think about this--if you work for 30 years
and you start at age 20 and you're putting money in the Social Security
system and you die, that money that you put in the system, if your
survivors are over 18 years old, goes away. I think it makes sense to
try to encourage people, particularly for the security of their
families, to be able to have something to pass on beyond other things
they're going to pass on.
I like the idea of having an account where people say, ``I own
this,'' and are able to look at a quarterly statement to watch their own
asset base grow. And I like people being able to say, ``I've got an
account that the Government cannot take away. It's mine.''
Some people say, ``Well, you can't afford to do this.'' My answer
is, you can't afford not to do it, if you look at the chart. And I'm
looking forward to working with the Congress. I've done my part. I've
laid it out there. I'm going to work hard. I'm going to spend a lot of
time talking to the people about this issue. And I've put out some
interesting ideas. And I'm looking forward to people assuming leadership
in the House and the Senate on both sides of the aisle. And I'm willing
to listen to their ideas. For the sake of the country, for the sake of a
younger generation of Americans, we must act.
Andrew Biggs. We are here with one
Andrew Biggs, a fine lad, as you can see. [Laughter] What do you do?
Work for me, of course. [Laughter] Tell them what you do, Andrew,
please--Andrew and I have done this before, see, so I'm used to needling
him. [Laughter]
Andrew Biggs. My name is Andrew Biggs,
and I'm Associate Commissioner for Retirement Policy at the Social
Security Administration, which in short language
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means I think about Social Security reform quite a bit. The good news on
Social Security, even if it seems very complex----
The President. Andrew has a Ph.D., by
the way. [Laughter] Which--it's an interesting lesson for those of you
who are worried about your college career. Andrew has a Ph.D., and I got
a C. [Laughter] And look who's working for who. Anyway--[laughter]----
Dr. Biggs. All those years of effort
gone to waste, I guess.
The President. It's a cheap shot, Andrew, I know. Do we have a problem with Social Security? You
look at it; you analyze it.
Dr. Biggs. Sure, we do. The good news
is, you don't need a Ph.D. to understand how this works. [Laughter] The
biggest misunderstanding people have----
The President. I'll let it pass, Andrew.
[Laughter]
[At this point, Dr. Biggs made further remarks.]
The President. Good job, didn't he? Fine
job.
All right, Noel--Noel Council. Where do you
live, Noel?
Noel Council. I live right here in Raleigh,
born and raised right here in Raleigh.
The President. There you go. Did you stay up late last night
watching a little basketball? [Laughter]
Mr. Council. No, but----
The President. Never mind. Kind of old, us kind of baby boomers,
isn't it, to stay up late. Anyway.
Mr. Council. Yes. I did watch Karl Rove,
though, on the FOX channel. [Laughter]
[Mr. Council, retired senior citizen, Raleigh, NC, made further
remarks.]
The President. Well, I appreciate the spirit. Look, I mean, the key
statement that I heard him say is it's not
going to change for him. So, evidently, the message has gotten to some--
[laughter]--and we got to keep getting it out. Senior citizens must hear
the truth, which is that the Social Security system will take care of
them, and they need not fear a discussion about how the children--a
system that works for our children and grandchildren will cause them not
to get the promises the Government made. And that's just important, and
I appreciate you bringing that up.
I also love the spirit of somebody saying, ``I'm not worried about
me; I'm worried about somebody else.'' And we really need to be. We
really need to be. I mean, it just would be, I think, a dereliction of
duty not to take on the tough task now. Of course, some of them are
saying, ``He's not going to be around but for 4 more years,'' but I can
assure you of this: For the next 4 years, we're going to be taking on
the tough problems like Social Security.
Dawn Baldwin. Are you ready to go?
Dawn Baldwin. I'm ready, Mr. President.
The President. All right. Where do you live?
Ms. Baldwin. I live in Merritt, North
Carolina, down in eastern North Carolina.
The President. Fabulous, yes. Wish I could say I knew where it was--
I'll play like it is. [Laughter]
Ms. Baldwin. We'll have you come down there
sometime.
The President. How far away from here is Merritt, roughly?
Ms. Baldwin. About 2\1/2\ hours due east of
here.
The President. Well, fantastic. Thanks for coming.
Ms. Baldwin. It's good to be here.
The President. You're a mom.
Ms. Baldwin. I am a single mom, and I do
want to say quickly, though, that I thank you for mentioning the
community college system, because I am a part of the community college
system. I teach at Lenoir Community College in Kinston.
The President. What's your subject matter?
Ms. Baldwin. English.
The President. English, yes. Some say I could use a little extra
work. [Laughter]
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[Ms. Baldwin, teacher, Lenoir Community College, Merritt, NC, made
further remarks.]
The President. Is this your first home?
Ms. Baldwin. This is my very first home.
The President. Imagine, ``Welcome to my home.'' That's fantastic.
You know, I was talking with Dawn, and she
was talking about a 401(k). It's an interesting concept. Many of you
know what a 401(k) is. Thirty years ago, no one would have known what a
401(k)--maybe they would have. I don't think so. I think 401(k)s are a
relatively new invention--401(k)--you've got one?
Ms. Baldwin. I do. And I'll tell you, Mr.
President, it was a kind of scary situation when I first started at a
community college system and was asked whether I wanted a 401(k). I had
never gotten involved with stocks, bonds, didn't really know what it was
about, but I can tell you that it is very nice every quarter getting
those reports to see how well my investment is doing.
The President. So you get advice?
Ms. Baldwin. I do.
The President. Yes, see, she gets advice.
In other words, it's a little nervous at first.
Ms. Baldwin. But it pays off well.
The President. Yes. [Laughter] And you get your--you see your
statement quarterly?
Ms. Baldwin. I do.
The President. Watch your asset base grow, which----
Ms. Baldwin. And it is another sense of
ownership.
The President. Yes.
Ms. Baldwin. And it makes you proud to be
an American.
The President. Well, it's an interesting--I think one of the--I hope
people take away--one of the things that I find so attractive about
enabling people to save some of their own money is the sense of
participation in the system, I guess is one way to say it. It's--as you
said, it makes you proud, but it's your asset base. And your little guy,
13-year-old son--some day, if you choose, it becomes a part of his asset
base. And the capacity to pass property from one generation to the next
is more than just passing a piece of land--which is a fabulous story, by
the way. But there's other assets you can pass on. And I think it
stabilizes society. I think it makes society more hopeful when people
say, ``This is what I own, and I'm going to choose to pass it on to
whomever I want.''
And I--and it's got--by the way, that concept must spread throughout
all society. It should not be confined to just one segment of society.
This isn't a Wall Street phenomena anymore. This is a phenomena of
people being able to own and manage their own money all throughout the
country, and it seems like it makes sense for us to give a younger
generation of Americans the same opportunity to do so through the Social
Security system.
You did a great job. Welcome.
Cyndi Godfrey.
Cyndi Godfrey. Yes, sir. [Laughter]
The President. You live?
Mrs. Godfrey. In Statesville, North
Carolina. I have some friends here.
The President. Half the town came. [Laughter] How many people in
Statesville?
Mrs. Godfrey. How many live in----
The President. Yes, how many live there?
Mrs. Godfrey. I think about 23,000----
The President. That's good, yes. It's big, bigger than it sounds.
Mrs. Godfrey. Might not want to quote me
on that. [Laughter]
The President. How many children you got?
Mrs. Godfrey. I have two little girls. One
is 4, and one is 6.
The President. Fabulous.
Mrs. Godfrey. We call them the Princess
and the Bulldozer. [Laughter]
The President. Sounds like kind of like my mother used to talk. Anyway--[laughter]--you're sitting up
here on the stage.
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Here's your chance to tell me. First of all, you work?
Mrs. Godfrey. I do work. I believe that
the world is run by those who show up. So I showed up today on behalf of
my friends and my family and about 80 employees at Godfrey Lumber. It's
a small, family-owned business started by my late father-in-law, Woodrow
Wilson Godfrey. You would have loved him. It's actually----
The President. Woodrow Wilson?
Mrs. Godfrey. Woodrow Wilson.
The President. Yes.
Mrs. Godfrey. His mother was a staunch
Democrat.
The President. Yes. [Laughter] Guy is a heck of a businessman,
though. [Laughter] Anyway, Godfrey Lumber.
[Mrs. Godfrey made further remarks.]
The President. I kind of took your regulation statement there--I'm
kind of trying to read between the lines. Are you saying to me that
you're worried about the system I'm talking about will cause you to have
more regulations on you, a little bit? Maybe, in other words, small
businesses are burdened by regulations, and there's a concern I've
heard.
Mrs. Godfrey. I would very much like to
know if this is going--if your plan, if your proposed plan is going to
help the small business, because we need all the help we can get.
The President. She doesn't want to be
managing the personal accounts, is what she's saying; she doesn't need
any more Government telling her what to do. And the answer is absolutely
not. It will not burden small businesses. And that's important for
small-business owners to understand. This is not an added regulation on
top.
By the way, my suggestion is what needs to be part of an overall
plan. I just want to make sure that I disabuse people of the notion,
personal accounts alone won't permanently solve the problem. That's what
people have got to understand. It's a part of an overall solution. It
just will mean that the younger workers will get a better deal when the
solution is finally decided upon.
Go ahead. Here's your chance to get people to buy a little lumber.
[Laughter]
[Mrs. Godfrey made further remarks.]
The President. That's good. I appreciate you saying that. The
concept of people managing their own money has changed dramatically. I
promise you, when I was most of the panelists' age, we weren't sitting
around wondering whether or not Social Security would be there. When I
was 30 years old--is that what you----
Mrs. Godfrey. Twenty-nine.
The President. Yes, when I was 29--[laughter]--we didn't have forums
where people came and said, ``Gosh, I wonder if Social Security is going
to be around when I retire.'' That never entered a baby boomer's mind.
Nor did the concept of people--more and more people being able to manage
their own money in the different kinds of retirement systems, Roth IRAs
and all the different retirement funds that are now available for people
to invest in. The world has changed; Social Security hasn't yet.
And so I find it incredibly interesting to hear younger folks talk
about life the way it is, workers being able to manage their own
account, saving something for my son.
Skip Long, he's here. He's got
some ideas and thoughts. You can see he's a young-looking guy----
Matthew ``Skip'' Long. Actually,
young chronologically, too.
The President. You live in Raleigh?
Mr. Long. I live here in Raleigh.
Most of my time has been spent in southeast Raleigh.
The President. Good.
Mr. Long. And I want to say my
wife and son--my wife is there, and my 10-year-old son----
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The President. Oh, yes, looking forward to seeing you afterwards.
What do you do? Thanks for coming.
[Mr. Long, president and chief executive officer, National Jobs
Partnership, Raleigh, NC, made brief remarks.]
The President. Before we get to Social Security, I think one of the
most important initiatives of this administration is to encourage faith-
based and community-based organizations to help find people help they
need. You're a faith-based man.
Mr. Long. Thank you.
The President. I can't think of a better organization than one
founded on the principle, you shall love your neighbor just like you
love yourself, in order to help somebody coming out of the prison system
find proper job training and get the skills and comfort necessary to
know that he or she can take on life's tough problems.
All right. So I'm going to keep pushing the faith-based initiative,
is my point. Back to Social Security.
[Mr. Long made further remarks.]
The President. There you go. How about that? Great job.
The system can be designed so that people can learn what it means to
invest. And that's important for people to know. I've heard some people
say, ``Well, you know, there are certain people in society that just
aren't capable.'' Forget it. Why do we want that kind of attitude in
America, ``Certain people can, and certain people can't?'' We've got to
believe everybody--everybody--should be allowed to take their own money
and, under certain guidelines, make wise choices. And that's going to
happen. There's a cultural change that needs to take place, obviously,
in some quarters of society.
And I love the spirit you're talking about. Because if you own
something, you have a vital stake in the future of your country. And
that's exactly one of the key points behind this notion about allowing
people to take some of their own money and investing it.
I think the panelists did one heck of a job up here. I want to thank
you all. I'm getting kind of old, so I need to stand up. Let me take
some questions, a few questions. And then I've got to head on over to
Pennsylvania to continue the dialog.
Yes, sir.
Extending the Age for Benefits/Citizens' Influence on the Process
Q. My main concern is, you said during your State of the Union that
all options was on the table. And I support your plan to strengthen
Social Security, but one thing I'm concerned about is extending the age
in order to be able to fund it. I would like to receive my benefits--my
money that I paid into it, into my own personal account as soon as
possible.
The President. Well, I appreciate you saying that. One way to make
sure people affect policy, with all options on the table is to--first of
all, let me say, I'm not taking options off the table until Congress
comes to the table and starts discussing. And secondly, if a lot of
people, younger workers are concerned about that option, you ought to
let the people know. And you're just letting me know, and I appreciate
it. Yes, I'll sign that book too. It's a fine book. If you're interested
in getting some sleep, read Chapter Five. [Laughter]
Q. Mr. President, on behalf of northeastern North Carolina, thank
you, thank you, thank you for what you do for our country.
The President. Thank you, sir.
Q. God bless George W. and Laura Bush.
The President. Thank you, sir.
Expanding Benefits
Q. Here's my question: In your effort to strengthen Social Security
for the 21st century, will you be able to use your bully pulpit in
perhaps persuading our own Congress, who does a great job but also has
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a generous retirement system, take a look at that system, itself, in an
effort to make, possibly, the retirement system for everyone in this
room and throughout the country a little more generous?
The President. Yes, I appreciate that. See, what he's saying is, is
that there is a go-by. In other words, this is a--I haven't invented
this; it's already happened. Federal employees get to do this. I said in
my State of the Union, younger workers ought to have the same option of
ownership, decisionmaking, better rate of return, that the Federal
employees have. And you bet I will.
You're right. I mean, this is--again, I repeat to you, this is going
to be an issue that's going to require good, close cooperation. And it's
not going to happen unless people of good will come forward and say,
``Let's get in this--get after this issue together.'' It used to be that
people would feel like they were lured out on the issue and then all of
a sudden had to pay a political price. What I'm saying to the Members of
Congress, ``We're all in this deal together.'' We're all going to--we're
going to be blamed together, or we're going to be praised together.
But I will do my part--I will do my part, initially, of not only
putting the issue out there for people to hear, which I did in the State
of the Union, but I'm going to travel our country, State after State
after State, conducting discussions just like we had here, as open and
frank as we can be, talking about the problems, talking about the
assurances, and assuring Congress it is now time to act. That is my
duty. I look forward to doing that. It also gets me out of Washington.
Preserving Current Benefits
Q. [Inaudible]
The President. Yes, sir.
Q. [Inaudible]
The President. We're not going to take away your Social Security
check, for starters. Go ahead.
Q. [Inaudible]
The President. Absolutely. [Laughter] I tell you what, that guy
right there I'm delegating. [Laughter]
Q. God bless you, Mr. President!
Q. Unfortunately, I don't have a letter for you to read, Mr.
President, but I just want to say it's such an honor to be speaking with
you. I'm very happy to be here.
The President. Thank you.
Benefits for Younger Americans
Q. I just wanted to let you know that as a young person, I think
it's very inspiring and encouraging to see how much confidence you have
in my generation's ability to make decisions. And I think that your plan
to strengthen Social Security is just another reflection of your high
level of trust and respect for the American people, and I wanted to
thank you for that.
The President. Thank you very much. You know, it's interesting--I
appreciate you saying that. Somebody was telling me the other day--I
also had Congress men and women come into the White House, the Oval
Office there--actually, the Cabinet Room, in this case--and I'm sitting
down with them individually and talking about, just like we're talking
here. And a person said--he read an interesting poll; he said that a lot
of younger workers felt like they're more likely to see a UFO than get a
Social Security check. [Laughter] It's an interesting dynamic, isn't it,
when you think about it. There are a lot of young people, when they
analyze Social Security and think about it, that they just don't think
the Government can fulfill the promise, which is a powerful--it's
powerful leverage for Members of Congress to listen to.
In other words, the dynamic has shifted. The reason people are
comfortable about taking on the Social Security issue, in the political
sense--I believe it must be done. That's the nature of the job; that's
the nature of the Presidency. But in a political sense, it's because
people are beginning to
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realize that once seniors understand nothing changes, there's a lot of
folks out there who are demanding change for their sake. They're saying,
``What are you going to do about saving the system for me? I'm coming
up. I have a better chance of seeing a UFO than getting a check from the
Government. What are you and the Government going to do to make sure I
get my check?'' That's the dynamic that's happening.
And that's why I'm optimistic something is going to get done,
because people are beginning to speak out. Younger Americans who
understand the math and know the reality are beginning to say to those
of us who have been elected, ``What are you going to do about it? You're
up there in Washington, DC. Do more than just occupy the office. Solve
problems, and do your job.''
Survivor Benefits
Q. Thank you, Mr. President. First of all, I just wanted to thank
you for your service to our country.
The President. Thank you, sir.
Q. Thank you. I have a question about Social Security benefits that
relate to things other than retirement, which is what you've put a lot
of focus on. In 2001, I lost my father, and he left behind my mother to
raise three kids, all under 18, and pay for everything that they needed
and support them financially. By the year 2042, this pay-as-you-go
situation is going to be pretty much exhausted. If that happens to
someone after that point, they're going to pretty much be depending upon
this small percentage that the Government is allowing them to put into
their nest egg fund. At that point they have to pull out of funds early.
Their index funds they'll have to pull out of early, which won't get to
grow very much, and their long-term bonds won't mature. So how does your
plan really----
The President. On survivor benefits? Are you talking about survivor
benefits under the current system?
Q. Yes. Yes, sir.
The President. First of all, the plan is only addressed to the
retirees, not to the disabled and survivor benefits. In other words,
we're focused on the retirement aspect of Social Security. Secondly, the
notion that a personal account--frankly, we haven't got to the emergency
withdrawal aspects of the personal account. The idea, though, is not to
let people--the main principle is not to let people withdraw money,
who've retired, from the personal account because it needs to be used
for retirement. In other words, you can't just lump-sum it out. This is
a complement to Social Security.
As to whether or not you, a young worker--I mean, a survivor of a
worker that passes on an account, whether you can draw it all out at
once, that's something we just got to work out with Congress. But
remember this, is that a plan that says you've been able to inherit
something other than survivor benefits, a chunk of assets, is I think
better--will be better than the current system.
Q. Yes, sir, I completely agree. From what I've seen of the system,
I absolutely love it so far. I just hadn't heard you talk to that point
yet.
The President. No, I appreciate that.
Q. Thank you.
The President. So you lived on--your mom and you lived on the
survivor benefits of your dad?
Q. We didn't live on it completely.
The President. I mean, it helped you--helped you.
Q. Helped make ends meet, absolutely.
The President. Yes, well, there's survivor benefits in the current
system if you are younger than 18 or your siblings are younger than 18
years old. If you're over 18, there are no survivor benefits for the
kids. There will be a permanent survivor benefit if there's an asset
that's been accumulated to be able to pass on. Whether or not you can
take it out or not to solve a family
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emergency after the person who accumulated the assets moves on, is
something we just got to work out with the Congress.
Q. Yes, sir. One more thing, I just wanted to introduce myself so
that I can say that I met you. My name is Bart Thornberg.
The President. Good job.
Yes, sir.
Q. Mr. President, Thomas Stith, Durham city councilman----
The President. Welcome.
Q. Good to be here.
The President. Thanks for serving.
Q. Thank you. More importantly, I'm a husband and a father of three
young daughters. And first of all, I want to say thank you for bringing
faith back to the White House.
The President. Thank you. Appreciate that. Thank you.
Addressing the Problem
Q. My question is simple. Certainly, we are very energized here
today, supportive. The system is clearly broken. What can we do once you
leave here today to ensure----
The President. Yes.
Q. ----that we can assist you in helping to fix this system?
The President. No, I appreciate you saying that. And part of my
reason to travel the country is to explain to people that there is a
problem. The Honorable got it--there is a problem. What we can do to
help you fix it? First step is to make it clear to people there is a
problem, because if the people in Congress say, ``There's not a big
enough problem. Let's just move it on,'' nothing will happen. In other
words, there has to be a sense of--in your voice, as you pointed out--
urgency. And it's going to take me a while to convince people of the
urgency to act.
I believe that once Members of Congress--and therefore, step one is
to convince people there's a problem, of both political parties. And
once people--once it gets in their mind that there is a problem, the
followup question is, ``Okay, now you see the problem. Now what are you
going to do about it?'' And we haven't got quite to the ``What are you
going do to about it'' stage yet.
We're going to continue--and I want to thank you for that. When--
write, talk--when you see people who say, ``Well, there's really not a
problem,'' just--the facts speak for themselves. Again, this is not a
political issue. This is policy at its most pure, I think. And the facts
are clear. And the facts say it's time to get something done. But I
readily concede there's a--we need a little more--I need to spend more
time convincing people that we're going to--we got the problem.
And then once we get to there, sir, it is--and I try to stimulate
discussion or at least prepare the way for a good discussion by saying,
``I'm willing to listen.'' And if you put an idea on the table, you
won't get--it won't be used to club you over the head politically with
it. In other words, there needs to be an honest, open dialog. You deal
with problems at your level, and the best way to deal with it is for
there to be an honest discussion about different solutions without fear
of political reprisal. And that's my--one of my pledges to the Members
of the United States Congress and the Senate.
And that--and so, but when the time comes, the other thing you can
do is assure people that nothing changes. Again, I just know--there are
people out there who rely upon Social Security who are very worried when
they hear political people like me talking about reform. They--the
concept of reform means, ``I'm not going to get my check,'' or ``I'm not
going to get all my check,'' or ``I'm not going to get enough of my
check.'' And we just have to continue to assure older citizens in
Durham, North Carolina, and around the country that nothing will
change--nothing will change. And once that assurance is fully
understood, then I'm confident the dynamic of younger workers saying--or
younger folks saying,
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``What are you going to do about me,'' becomes a much more viable--
becomes a driving force for reform of the Social Security system.
I'm probably talking too much strategy and tactics, but I think
it's--people who are interested in the subject, you got to know how I
think this issue is going to unfold. And--so thanks for your great
comment.
One thing about faith: It's very important for this country to
always remember that our strength, as opposed to some of these
ideologues of hate that we deal with, our strength is the fact that you
can worship or not worship and be equally patriotic. And if you choose
to worship, you're equally patriotic if you're a Christian or a Jew or a
Muslim or a Hindu. That is the wonderful thing about the United States
of America. And regardless of what you believe and your beliefs, we must
always jealously guard that great freedom of ours.
Yes, ma'am. I hate to tell you--we could be here all day--but I am
headed toward Pennsylvania. Last question. I know you're disappointed.
Age for Opting Into a New Social Security System
Q. Mr. President, an honor, sir. I thank you for your perfect segue
into my question to you. I think the constituency most skeptical about
reform appears to be those 55 and older. And I think the part of your
program that's most appealing to that skepticism is that part that talks
about opting in. Can you address more specifically the age in which you
are allowed to opt in or not?
The President. People born from--after 1950. That's a pretty easy
question to answer. [Laughter] And that would not be me.
Listen, I am so honored you all came. What a fantastic setting. I
appreciate your time. I want to thank our panelists again for coming.
God bless you all. Thank you.
Note: The President spoke at 11:12 a.m. at the BTI Center for the
Performing Arts. In his remarks, he referred to former Senator Jesse
Helms of North Carolina; President Hamid Karzai of Afghanistan;
President Mahmoud Abbas (Abu Mazen) of the Palestinian Authority; and
former Representative Timothy J. Penny of Minnesota.