[Public Papers of the Presidents of the United States: George W. Bush (2005, Book I)]
[April 15, 2005]
[Pages 604-614]
[From the U.S. Government Publishing Office www.gpo.gov]
Remarks in a Discussion on Strengthening Social Security in Kirtland,
Ohio
April 15, 2005
The President. Thank you all for coming. Please be seated. I
appreciate you coming, Steve, thanks.
Glad to give you a ride home on Air Force One. [Laughter] I really do
like working with Steve. He's a thoughtful fellow who cares about
issues, and this is--what we're here to talk about is an important
issue, which is Social Security.
Before I do, I want to thank the community college for hosting us.
I'm a big believer in community colleges. Community colleges have got
the capacity to change curriculum to meet the needs of a local
workforce, for example. And one of the real challenges of the 21st
century is to make sure people have got the skills necessary to fill the
jobs of the 21st century. And a fabulous place to find those skills is
our community colleges.
So thanks for what you do. Thanks for being a host. Thanks for
letting us come and have a--what I think you'll find to be a really
interesting educational experience about a vital issue confronting the
country.
I want to thank Lieutenant Governor Bruce Johnson for joining us today. I appreciate State Treasurer
Jennette Bradley for joining us today.
I want to thank the mayor, Ed Podojil,
who is here. I appreciate you, Mr. Mayor. And I want to thank Dave
Anderson. The last time I saw Dave, I said
to Dave, I said, ``Dave, fill the potholes.'' [Laughter] That's just a
piece of advice. [Laughter] And so I saw him in line coming in. He said,
``I'm just here to report for duty, Mr. President. I did fill the
potholes.'' [Laughter] You'd get reelected if you want to run again.
[Laughter]
Anyway, I want to thank Anita Isom, who's
with us. Anita is a young lady I met when we landed there at the airport
in Cleveland. She is a volunteer, and she has helped and been awarded
because of her reading-related activities that benefit others. The
reason I like to mention a soul like Anita is that, no matter what your
age, no matter where you live, you can help this country by becoming a
volunteer, by helping somebody who hurts, by teaching somebody to read,
or feed somebody who's hungry, or put your arm around somebody who needs
love.
I like to remind people that the greatest strength of this country
is the heart and souls of our fellow citizens and the great compassion
of our people. And so if you're interested in serving America, do so by
becoming a volunteer in the community in which you live and help change
this country one heart and one soul at a time.
So, Anita, thanks for coming. Thanks for
meeting me at the airport.
Let me talk about Social Security. I could be talking about a lot of
things, peace
[[Page 605]]
and freedom. The world is changing right now because societies are
becoming more free. And as societies become more free, more democratic,
the world will become more peaceful.
Today I went to a little restaurant, and the owner happens to be Lebanese American. And he said,
``Thank you, Mr. President, for staying focused on a country like
Lebanon and insisting that Lebanon be allowed to have free elections.''
And I assured him, like I'll assure you, that when America speaks, we
mean what we say. When we say ``free elections'' to the Syrians, we mean
free elections. Get out of Lebanon, and let this good country have a
free election as scheduled. When I say, ``Get out of Lebanon,'' I mean
out of Lebanon with all your troops and all your security services and
all the people trying to influence that Government. It is in the world's
interest that Lebanon be allowed to have free elections because a free
society will help spread the peace.
We're dealing with a lot of issues, and in Washington, DC, I've
submitted a tough budget and expect the Congress to be wise about how
they spend your money. I also know that Congress needs to stop debating
and get an energy bill to my desk now, during this session.
Congress also needs to take serious this issue about Social
Security. People say, ``Why did you bring it up?'' I said, ``I brought
it up because I see a serious problem that needs to be fixed now, before
it's too late. I also brought it up because the job of a President is to
confront problems and not pass them on.'' The easy route in politics is
to say, ``Well, we got us a problem. We'll just let the next person
handle it.'' The easy route for a Member of the United States Senate is
to say, ``There is a problem, but it perhaps can wait. We'll just let
another United States Senate fix it or send it to the House.'' That's
not the way I think. I think I got elected because people expect me,
when I see a problem, to bring it to the fore and to work with people to
get it solved.
And here's the problem in Social Security. There's a lot of people
like me getting ready to retire. [Laughter] As a matter of fact, I'm
retiring in 4 years--at least I hit retirement age in 4 years, which is
convenient--[laughter]--in my case. I turn 62 in 2008. And I'm not the
only one turning 62 in 2008. As a matter of fact, there's a lot of us.
We're called the baby boomer generation. And not only is my generation
fixing to retire, we are living longer than previous generations. And
not only are we living longer than previous generations, we have been
promised greater benefits than the previous generation. In other words,
people running for office say, ``Put me in office, and I'll increase
your Social Security benefits for you.'' And guess what? They did.
And so a lot of us are getting ready to retire, and the problem
comes because there's not a lot of people paying into the system. See,
in 1950, there were 16 workers for every beneficiary. So you can imagine
the load was somewhat lighter than today, when there's now 3.3 workers
for every beneficiary. And soon there's going to be two workers for
every beneficiary. You've got fewer workers paying into a system that is
going to require more and more out-flow, because a lot of us are
retiring, living longer, and been promised greater benefits. And the
math just doesn't work.
It's a pay-as-you-go system, by the way. That means, when the money
goes in, it comes right out. It's not a trust. I mean, some people in
America, I suspect, think that the Federal Government all these years
has been collecting your payroll taxes and we're holding it for you, and
then when you get ready to retire, we give it back to you. That's not
the way it works. The way it works is, is that we collect your payroll
taxes and we pay the current retirees their benefits, and then with
leftover money, we spend it on other things. That's
[[Page 606]]
the way the system works. It's pay-as-you-go.
And in 2017, the pay-as-you-go system is going to go negative. In
other words, more money goes out than comes in through payroll taxes.
And every year thereafter, if we don't do something, it gets worse and
worse and worse and worse. To give you an example of how bad it gets, in
2027 the Federal Government is going to have to come up with $200
billion more a year just to make good on the payments, and it gets worse
the next year and the next year and the next year.
I also want to assure those of you who are on Social Security, you
will get your check. See, nothing changes for somebody born prior to
1950. And that's very important for people in Ohio to hear, because I
fully understand a lot of people count on that Social Security check.
That Social Security check means a lot to a lot of people in America,
and they're counting on it. That's why, for example, in some political
campaigns people try to say to seniors, ``You know, if so-and-so gets
into office, he's going to take your check away from you.'' That's the
old scare tactics. Sometimes during this debate it seems like people are
resorting to those scare tactics. They're telling seniors, ``Really what
they're talking about is taking your check away.'' Let me just tell you
point-blank, if you're receiving a Social Security check in Ohio, this
Government of ours will continue to honor you, honor that commitment.
This issue isn't about you. This issue is about your grandchildren.
The issue confronting the Social Security system is an issue for young
workers, young people coming up. One time I was having a discussion, and
the person said, ``I saw a survey.'' I said, ``Oh, yeah, what did it
say?'' ``It said young workers like me are more likely to see--think
we're more likely to see a UFO than get a Social Security check.''
[Laughter] That may be pretty close to accurate.
I'll tell you this, if this Federal Government doesn't act, your
bill, your payroll taxes are going to have to go up a lot in order to
pay the promises made to me, or the Government is going to have to slash
the benefits, or the Government is going to have to make dramatic cuts
in other programs. And so I see a problem. I think the math is clear.
And so now is the time to get something done.
And so I stood up in front of the United States at my State of the
Union Address and said to the Congress, ``Here's the problem. And I'm
going to put some ideas on the table,'' ideas that I didn't necessarily
think of; ideas that President Clinton
had thought of or Senator Moynihan, a great Member of the United States
Senate from New York who, unfortunately, has passed away, or former
Congressman Tim Penny--good ideas about
different ways to permanently fix the problem. And that's what Congress
must do. It must permanently fix the problem.
In 1983, one of my predecessors, President Ronald Reagan, got
together with Speaker O'Neill from Massachusetts, and they said, ``We
got a problem. Let's fix it.'' See, the math wasn't working then,
either. It was called a 75-year fix. They signed a bill--I love the
spirit, by the way, of Republicans and Democrats setting aside their
political parties and focusing on getting something done for the
American people. And the President did that; the Speaker did that for
the 75-year fix. The only problem is, 22 years later we're still talking
about it. And so now is the time to bring people together from both
parties to have a permanent fix, and all ideas are on the table. And I'm
looking forward to discussing any good idea with a Democrat or a
Republican.
I imagine there's some people fearful in Washington, DC, about maybe
laying out an interesting idea and that one of the political parties
will get all over them for laying it out. If I had anything to do with
it, it would be political amnesty for people bringing good ideas
forward. Now is not the time to play political ``gotcha'' with a
[[Page 607]]
member of any political party for stepping up and bringing forth ideas
to do what they think is right to help solve this problem permanently
for generations of Americans to come.
Now, one of the ideas that I think is important for the Congress to
consider is to allow a younger worker to be able to set aside some of
her or his own money in a personal savings account, as a part of a
Social Security solution. See, I think Government ought to say, ``We'll
give you an opportunity, if you want to--your choice.'' We're not
saying, ``You must set aside money.'' We're saying, ``You ought to have
the opportunity to. It ought to be voluntary to set aside some money so
that you can earn a better rate of return on your money.'' People ought
to be given a chance to invest in a conservative mix of bonds and
stocks.
In other words, it's part of a permanent solution in order to make
sure the younger worker gets a better deal. The younger worker ought to
be allowed to set aside some of the payroll taxes. And this is a
concept, by the way, that has been tried before. I haven't invented the
idea. As a matter of fact, the Federal--Congress before has said we
ought to allow people working in the United States Congress and
Congressmen and United States Senators to do just what I described. The
Federal employee Thrift Savings Plan allows Members of Congress and the
United States Senate to take some of their money and set it aside in a
personal savings account. Why? Because they know they'll get a better
rate of return on their money than if the Federal Government held it.
And it seems fair to me that if setting aside money in a personal
savings account is good enough for a Member of the United States
Congress, it's good enough for workers all across America.
Okay, so I went to school with a guy who made all A's. It's probably
recognized by now I didn't do all that well in college at times--
[laughter]--and I brought him with me. He's an expert. He's my National
Economic Adviser. But I want you to notice,
you students out there, who's the President and who's the adviser.
[Laughter]
I've got a fabulous staff. People need to judge the President based
upon who he listens to. And as you know in foreign policy matters, I
listen to some really capable people, Condi--Condoleezza Rice, the Secretary of State; Secretary
Rumsfeld. And on the domestic side, I've
got great people working with me. One of them is Al Hubbard, a business guy out of Indiana, started businesses,
ran businesses, entrepreneurial. He's agreed to come and serve as the
National Economic Adviser to the President. He briefs me on a regular
basis. And one of the big issues that I've got him working on is Social
Security.
I want to thank you for coming, Al. And
if you got something to say, now is your opportunity. [Laughter] Please
don't try to defend yourself because the President always has the last
word. [Laughter]
Allan B. Hubbard. Yes, sir, I've
learned that very quickly. Thanks for giving me this opportunity.
[At this point, Mr. Hubbard made brief remarks.]
The President. You're the guy who authored
the bill?
Raymond Sines. I had the first bill in
1994.
The President. Really.
Mr. Sines. Introduced it.
The President. If you got any spare time, you might want to come up
to Washington and work the issue with me. [Laughter]
Mr. Sines. Well, Mr. President, I really
like Lake County. [Laughter]
[Mr. Sines, commissioner, Lake County, OH, made further remarks,
concluding as follows.]
Mr. Sines. I have three daughters, and
kind of in the same mode as you, we're in a special club when you raise
daughters.
[[Page 608]]
The President. Yes. Your hair is about as white as mine. [Laughter]
Mr. Sines. Yes, it is, and it's getting
whiter--and it's getting whiter.
[Mr. Sines made further remarks.]
The President. It must make you feel good to be able to sit here in
front of all these TV cameras and say, ``I saw a problem. I worked with
people from both sides of the aisle to fix it, and it's working.''
That's the spirit the people in the United States Congress must hear.
It's not time to play politics. It's time to fix the problem. It's time
to set aside all this business about, my party may look good, or so-and-
so may look good, and so-and-so may look bad. We've really got an
opportunity, a need to fix it.
And secondly, I am--I just want you to know that like you went
through, there were some moments as to whether or not you thought the
thing would pass. Yes, well, you know something, I'm going to be
relentless on the subject because I believe the American people, once
they understand there's a problem, once they understand the math, and
once seniors understand that nothing is going to change, the next
question to Members who have been elected is, ``Why aren't you doing
something about it?'' See, if there's a problem--you saw the problem--
and people begin to recognize the nature of the problem and the size of
the problem and the cost of inactivity, and senior citizens understand
that the propaganda they may have heard about somebody taking away their
check simply isn't true, the next logical extension of the debate and
the discussion is, ``Say, if we got a problem and I'm going to get my
check, what are you going to do about my grandkids?'' It's a
generational issue.
And we're just starting. So don't worry about me, Ray. I'm feeling pretty good about where we stand. The
American people are wise. They just need to know the facts.
Part of the facts is understanding we have a problem, and part of
the facts is what you're going to do about it. And today, this is an
interesting opportunity for people to see a system that is--I bet most
people in America don't understand what happens here in Ohio when it
comes to the retirement system. And so thank you for being an innovator,
and thank you for being a leader.
Now, who's next, Hubs?
Mr. Hubbard. Mr. Scott Johnson, who is
very involved with the Ohio Public Employees Retirement System. And he
can describe this new innovation that Ray provided through the
legislature.
The President. Good. Tell us what you do.
Scott Johnson. Thank you, Mr. President.
I'm Scott Johnson. I'm Governor Taft's director of administrative
services. That's a central services organization similar to your General
Services Administration, only adding human resources and personnel.
[Mr. Johnson made further remarks.]
The President. By the way, I went to West Virginia the other day and
saw the asset base of the so-called Social Security trust. You know
what? It was about four or five file cabinets full of paper. [Laughter]
It was the IOU left behind from one hand of Government to the other hand
of Government.
Mr. Johnson. We've been operating that
since 1935, but of course, society has changed a bit over that period of
time.
[Mr. Johnson made further remarks.]
The President. Sorry to interrupt you. Presidents do that sometimes.
[Laughter] Portability--so if somebody is listening, and they're not
exactly sure what that means and why that would be important to them----
Mr. Johnson. University professors
typically move around----
The President. Right.
[[Page 609]]
Mr. Johnson. ----and in mid-career may
move from one university to another. And so they've already gotten some
sort of retirement system underway and would like to move that from
where they are to where they're going.
The President. If they change jobs, they could take their retirement
account with them.
Mr. Johnson. Exactly.
The President. Yes. That's important for people to know. That's a
concept that's an important part of any good plan, would be to recognize
the needs of the person that is receiving a part of their retirement.
They can move.
Go ahead.
[Mr. Johnson made further remarks.]
The President. I think that's a reasonable concept. Don't you,
folks? Government says to the people, ``You have a choice to make,'' you
know?
Mr. Johnson. So what you, therefore, have
with that combined program is a system where the portion that the
employer, the State or the county or the city, contributes is
administered by the professionals at the system. And the amount that the
employee himself or herself contributes could be managed by that
employee.
[Mr. Johnson made further remarks.]
The President. Yes, I guess you can't take the money and put it in
the lottery----
Mr. Johnson. Well, even though we run a
lottery----
The President. ----or on the trotting jockey--trotters or whatever
it is next door here.
Mr. Johnson. No, sir, you can't do that.
The President. The point is that there is a relatively conservative
or conservative mix of what's available for people to invest in. Is that
an accurate assessment of the choices people have to make?
Mr. Johnson. The choices are all
responsible ones, Mr. President.
The President. I don't know about the lottery being irresponsible--
[laughter].
Mr. Johnson. But there is a great deal of
variety and individual ability to be aggressive or not so aggressive as
one chooses.
The President. That's right. See, it's an interesting concept that
the people of Ohio have put in place. And the government basically said,
``Hey, why don't we trust people? After all, it's their own money. Why
don't we give them a chance to''--but you just can't go--there is a
certain set of parameters, I presume, Scott,
that--just like there is for the Federal employees, by the way. In other
words, ``Here's some options for you.''
Some people think about whether or not people ought to be allowed to
invest. They call it risky. I don't think it's risky to let people earn
a better rate of return on their money, but obviously there's some
parameters. There's some go-bys. And as you said, I think there's eight
different options--nine different options.
Mr. Johnson. Nine, yes.
The President. In other words, the Government says--the Government
does play a role and says, ``Here's nine different opportunities for you
to have a mix of stocks and bonds.'' Or it can go totally bonds, totally
stocks, or is it generally a mixture? How does it----
Mr. Johnson. Mr. President, there are
layers of choices you can make. You could, if you wish, choose one of
three pre-mixed options.
The President. Got it.
Mr. Johnson. One would be conservative,
one less conservative, and one, frankly, aggressive. Or you could, if
you wish, develop your own asset mixture. You could have some bonds. You
could have some equities. You could have TIPS. Conceivably, you could
invest it all in bonds.
The President. Yes.
Mr. Johnson. You could do that if you wish
to do so.
[[Page 610]]
The President. Okay. You got any average rate of return on these
programs? Or is that impossible to do?
Mr. Johnson. It's not impossible to do,
but it's beyond my level of expertise. [Laughter]
The President. Okay. Well, I was talking with Senator
McCain, who told me that he thought his rate of
return, I think, was over 7 percent in his employee retirement Thrift
Savings Plan, over time. In other words, a conservative mix of stocks
and bonds that the Government--Federal Government allows Federal
employees to make, a rate of return over 7 percent. You see, if you're
keeping your money in the Social Security system, it's about 1.8
percent. And the difference for a younger worker between 7 percent and
1.8 percent over time is a lot of money, because interest compounds. It
grows. Money grows over time.
And I think that's one of the reasons why employees said, ``If it's
good enough for professors, why don't you let me have a taste of this
too? Why don't you give me a chance to watch my money grow and let me
control it, and let me own it?''
So, I appreciate you bringing that forward, Scott. Thank you.
Mr. Johnson. Yes, sir.
The President. Very good job.
Betty Young, welcome. What do you do, Betty?
Betty Young. Thank you, Mr. President, and
it's an honor and a pleasure to be here. I'm the executive director of
human resource services for the University of Cincinnati.
[Ms. Young made further remarks.]
The President. First, you notice that Betty
talked about 401(k)s and IRAs. I don't remember 401(k)s when I was
growing up. In other words, there is a new culture in America when it
comes to people managing their own assets; 401(k)s encourage management
of your own assets--IRAs. In other words, more and more people in
America are now becoming used to controlling their--managing their own
money.
I presume you find a certain reticence initially, when--that says,
``I'm not so sure I can do this.''
Ms. Young. But you don't have to be a Wall
Street wiz.
The President. Right.
Ms. Young. For example, the university
requires that the different providers that offer these programs, that
they provide educational materials.
[Ms. Young made further remarks.]
The President. That's good. You know, interesting thing that
Betty talked about was encouraging people to
open up a quarterly statement, or if you so choose, you can look at your
wealth on a daily basis. I think that's an interesting concept. It seems
like to me we'd like all of America doing that, watching their assets
grow, not just Wall Street wizzes but everybody. I mean, if more people
owned something--I like the idea of having a program in Ohio where it
encourages ownership--not just one type of person but all people have
got access to ownership.
It seems like to me a more hopeful America is going to be one in
which people say, ``I'm watching my assets grow, and I'm more''--let me
just say, politicians will be--their actions will be a lot more
scrutinized when somebody is watching whether or not the decisions made
in Washington is affecting their work on a daily or quarterly basis. In
other words, the more people paying attention to their assets, the more
people will be paying attention to what happens in Washington, DC, or in
Columbus, Ohio.
So thanks for bringing that to my mind. Let me ask you this:
Obviously, there's a certain role for the State, and that is the State
has chosen the providers--is that right, screened and chosen the
providers?
Ms. Young. Yes. The Ohio Department of
Insurance screens and chooses the providers that participate in the Ohio
Alternative Retirement Program.
[[Page 611]]
The President. So the charge that somehow a fly-by-night is going to
get a hold of somebody's retirement account and fritter it away is just
frivolous.
Ms. Young. Correct, because if there's ever
a problem, for example, with one of the providers, then as the person
that manages the program at the University of Cincinnati, then I can
contact the Department of Insurance or go directly to that company about
any issues that we may have.
The President. One of the other things that Betty talked about was mixing risk. And people need to
understand that you can constantly change the risk of your asset base,
that, for example, if you're 20 years old, you can take a little more
risk. And when it comes time for fixing to retire, you switch from,
perhaps, stocks--mix of stocks and bonds to a greater mix of bonds to
stocks, so that you're able to decide for yourself what kind of asset
base you have relative to where you are in the retirement--how close you
are to retirement age. And I presume people are doing that, constantly
switching in and out all the time to manage their assets.
[Ms. Young made further remarks, concluding as follows.]
Ms. Young. So I have my funds in a portion
that is guaranteed 6 percent. That won't change during the life of the
account.
The President. About 6 percent--it's a lot better than 1.8 percent
in the Social Security system. And the difference between the 6 percent
and the 1.8 percent over Betty's lifetime is a
significant amount of money. And that's important for people to
understand. What we're trying to do is to learn lessons from a State
like Ohio, apply it at the Federal level, so workers get a better deal.
And part of a better deal is a better rate of return. And part of a
better deal, by the way, is saying, ``I own it.''
You listen to Betty's language. She's
talking about her assets. She's not relying upon the Government. She
says, ``These are my assets, and I own these assets.'' And that's
important. The more people own an asset, and the more people are able to
say, ``I'm going to pass it on to my son or daughter, whoever I
choose,'' the better off America is, you see, being able to spread
wealth.
Thank you, Betty. Good job.
Let me say one thing about the Social Security system before we get
to Rick. Do you realize the system today is
structured so that if you die early and you leave behind a spouse--say,
you started working and contributing to the system at age 21, and you
died at 51, 30 years of work, and you leave behind a spouse, and the
spouse works--like many families in America, there's two spouses
working--that the--and the spouse is the same age as the husband or
wife, there are no death benefits if you're younger than 62 years old.
And secondly, when the surviving spouse retires, he or she will get to
choose between the survivor benefits or the contributions that he or she
has made--is owed by the Government, whichever is greater, but not both.
Now, think about that. That's a system in which the person who's
worked for 30 years, put in the money, and it's just gone. I don't think
that makes sense for a good retirement system. The system here in Ohio
essentially says that, if the principle were applied to the Federal
Government, you have an asset. It grows. You watch it. You manage it,
and if you pass away, you can leave it to your spouse to help that
person transition, then help that person live life. It's an asset. This
asset doesn't exist in a file cabinet in West Virginia. It's yours. It's
an asset that you call your own, that can help you.
Now, when people retire here, I presume you can't spend all your
asset base at once.
Ms. Young. You could take a withdrawal on a
lump-sum basis, but normally, again, your ARP provider is going to work
with you to design how you should now start drawing down on your money
to ensure
[[Page 612]]
a level of income throughout your remaining lifetime.
The President. That's what the--that's the vision at the Federal
level for a personal account, is that there will be a drawdown to help
complement the check, however big it's going to be, from the Federal
Government. All I'm telling you is, we made promises to younger workers
we can't keep. In other words, we've said, ``We can pay you.'' We can't.
Do you realize that in order to make sure that the payments that we
promised to retirees are kept, that a younger worker may have to pay
upwards of an 18-percent payroll tax? Try that on if you're a small-
business owner. Try that on if you're struggling to get ahead. We need
to fix it now, and one way to--a part of making sure the retirement
system works well is to listen to the example right here in the State of
Ohio.
Rick, ready to roll?
Richard Stenger. I certainly am.
The President. Okay. What do you do?
Mr. Stenger. I'm currently one of the
directors of the Lake Metroparks system. We want to welcome you back to
Lake County. The last time you were here----
The President. Yes, I know--[inaudible]. Thank you.
Mr. Stenger. You and 20,000 friends came
and had a good day. [Laughter]
The President. I hope LaTourette
stayed behind to clean up. [Laughter]
Mr. Stenger. Steve got busy. He was
there, but he was watching us. [Laughter]
The President. Okay. He was an
executive. [Laughter]
[Mr. Stenger made further remarks.]
The President. How did your money do in the Social Security system?
Mr. Stenger. Yes, 1.8, I think, right?
The President. Yes. You take a 6-percent differential, or 5.2-
percent differential over a number of years, and you're going to see
some serious money. And it ought to grow. The Government ought to give
opportunities to our fellow citizens to have their money grow in a
conservative mix of stocks and bonds, just like they did. It seems to
make sense to me.
Mr. Stenger. Mr. President, one of the
things that I found very helpful and interesting is the system does a
good job of educating, because you come in and you're not sure what to
do, and many people are afraid of change. They had a battery of
questions you could answer, I think 20-some questions, and it sort of
guided you as to where you fit on the investment scale. If you answered
the questions, it would give you a score, and the score sort of
categorized you into, you're okay to aggressively do it, conservatively
do it, moderately do it. So people who are afraid of it don't know--you
answer this battery of questions, and it gives you a pretty neat answer.
The President. Yes. See, that's an interesting point. I think some
people are fearful of the obligation, I guess, if that's what it--of
investing their own money. They're not exactly sure what the words mean.
It's kind of an interesting assumption here in America, the investor
class is only a certain type of person. I don't buy into that. I think
all people are capable of learning what investment means. People from
all walks of life, all neighborhoods have got the capacity to manage
their own money. And you say the system helps people learn the words and
learn what all this means. I mean, it's kind of fancy--rate of return,
bonds and stocks.
Mr. Stenger. And the nice thing about it
too, as Betty mentioned earlier, you can change. If you realize, ``Well,
I went real aggressive,'' and your lifestyle changes for whatever reason
and you want to change, you can get online--you can do it daily if you
so desire--you can take your quarterly statement, analyze it, make
changes appropriately if you so desire. It's not like you're stuck with
the choice you made.
The President. How do you make sure, like, these firms don't gouge
you when it comes to fees? They've got a captive audience. They've got
you pretty well roped
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in once you make the decision. How does Ohio make sure that these fees
aren't going up, that they're reasonable?
Mr. Stenger. The fees are defined--Scott
would know more than I do, but if I read right, the fees are defined,
depending on the plan you chose. I think the plan I chose, they're about
.24, if I'm not mistaken.
The President. .24--sounds reasonable.
[Mr. Hubbard made further remarks.]
The President. I appreciate that.
What else you got, Ricky?
[Mr. Stenger made further remarks.]
The President. Well, I appreciate that. Listen, thanks for sharing
this with us.
I got on the airplane; I started paying attention to what I was
going to hear today; and I was amazed at the willingness of the great
State of Ohio to think differently on behalf of the people who live
here. And it struck me about how relevant this conversation was going to
be, for others to listen to what is possible for Social Security.
Now, look, we need to come together in Washington, and we need to
work on a permanent fix. All options are on the table. But part of that
solution, in order to make it a better deal for younger workers, is for
people of both parties to trust people with their own money, to devise a
system that would work similar to the State of Ohio, that would say,
``We're going to let you earn a better rate of return for your money,''
that would enable a mom or a dad to pass on their assets to whomever
they chose, that would encourage portability, but that makes sense. It
makes sense. The more somebody owns something in America, the more
they're going to have a vital stake in the future of this country.
The State of Ohio has incorporated a lot of really important
principles in this bill, Ray, and I want to
thank you for that. One of the key principles is, Government has got to
trust people. The more Government trusts people, trusts people with
their own money, the more content, the more prosperous our society will
be.
And so I want to thank you all for sharing with us. I hope you found
it as educational as I have. I look forward to continuing to take this
message to the people of the United States of America. I have great
faith in the wisdom of the people of this country, and I fully
understand that when the people of this country understand the depth of
the problem that a young generation of Americans is going to face, and
when senior citizens understand that they're going to get their check,
the question is going to start to be to Members of Congress of both
political parties, ``How come you're not fixing it,'' because America is
going to realize that every year we wait it's going to cost the young
generation of Americans $600 billion to make this right.
And here's a fascinating idea, started right here in the great State
of Ohio, sponsored by both Republicans and Democrats, that's working.
And Congress needs to pay attention to things that work.
Thank you all for coming, and God bless.
Note: The President spoke at 1:03 p.m. at Lakeland Community College. In
his remarks, he referred to Representative Steven C. LaTourette of Ohio,
who introduced the President; Mayor Edward J. Podojil of Kirtland, OH;
and Mayor David E. Anderson of Willoughby, OH. Discussion participant
Scott Johnson referred to Gov. Bob Taft of Ohio.
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