[Weekly Compilation of Presidential Documents Volume 41, Number 7 (Monday, February 21, 2005)]
[Pages 238-247]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Remarks in a Discussion on Strengthening Social Security in Portsmouth, 
New Hampshire

February 16, 2005

    The President. Thanks for coming. Hi, John. It's nice to be back 
with friends. Thank you all for being here. We're here to talk about a 
vital issue, and that is Social Security. But before I do, I want to say 
hello to some folks, maybe talk about a few other things. And then we'll 
get our panel involved.
    Before I begin on other things, I just want you to know what I think 
my job is, to confront problems, and not to pass them on. And so, as you 
hear a discussion about issues, I hope you keep that in mind. I believe 
a leader ought to, when they see a problem, address it head on and not 
say, ``Okay, we'll wait for somebody else to take care of the problem.'' 
That's what we're here to discuss.
    First, I want to really thank your Senators from the great State of 
New Hampshire, Senator Judd Gregg and Senator John Sununu. I appreciate 
their leadership. I appreciate their advice. I appreciate the fact that 
they're willing to jump on Air Force One anytime I come to New 
Hampshire, for a free ride. [Laughter] Judd is in charge of the budget 
for the United States Senate. Believe me, he brings a sharp New 
Hampshire eye to the budget process, and that's good. I'm looking 
forward to working with him. He'll be a great budget leader.
    I want to thank the speaker of the house, Speaker Scamman, and the 
president of the New Hampshire Senate for joining us. Thank you, 
members, for being here. I'm proud you're here. I want to wish my friend 
Commissioner Dick Flynn a happy birthday. Today is his birthday. I want 
to thank the State and local officials who are here, appreciate you 
coming.
    I want to thank Reggie Wright. I met--where's Reggie? Yes, Mr. 
Wright, thank you for coming. Reggie Wright is 81 years old--or will be 
81 on Monday. He is a volunteer at the veterans hospital, and I 
appreciate that. The Portsmouth Veterans Affairs Community Based 
Outpatient Clinic, right here in--that's a long word, but anyway--a long 
series of words--here at Pease. And I appreciate his volunteering.
    See, here's the thing about volunteering. If you volunteer to make 
your community a better place, you're adding to the great compassion of 
America. And so, for those of you who are taking time out of your life 
to help feed the hungry or provide shelter for the homeless or love 
somebody who hurts, I want to thank you for being a soldier in the army 
of compassion. Thank you for setting such a good example, Reggie. I 
appreciate that.
    I'm getting ready to go to Europe, and I'm looking forward to it. 
I'm looking forward to talking about how we can work together to extend 
freedom around the world so that the world is more peaceful for 
generations to come. I'm looking forward to reminding the people of 
Europe that there has been some amazing events in the march of freedom, 
if you think about it. The Afghan people went to the polls in the 
millions to vote for a new leader, and that is important, providing an 
example for others to show what can happen when people are given a 
chance to live in a free society. Free societies are peaceful societies. 
Democracies produce peaceful nations. And the elections of Afghanistan--
I hope you found them as hopeful as I did, and I'm convinced many in 
the--on the continent of Europe found hopeful as well.
    I will remind them about what happened in Iraq. It was a grand 
moment when millions

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defied the terrorists and went to the polls to say, ``We want to live in 
a free society.'' For those of you who have been to Iraq--I see we've 
got some marines here--or family members in Iraq, I want to thank you 
for your loved ones' sacrifices. I hope that the hug that took place at 
the State of the Union spoke to you as much as it spoke to a lot of 
people I've talked to. It certainly spoke to me. It said that there's a 
mom who's longing for--to be able to hug her son, but her son's 
sacrifice was recognized by the woman who got to vote. It was a--I 
thought it was a wonderful moment of compassion and freedom and, 
eventually, peace that we all want for our children and grandchildren.
    Freedom is on the march, and I look forward to working with our 
friends in Europe to continue that march, so when it is all said and 
done we can look back and say, ``The world is safer and more peaceful 
for our children and grandchildren.''
    Looking forward to working with the Congress to make sure we put 
things in place--plans in place to keep this economy growing. The 
unemployment rate here is 3.3 percent. That's pretty low. Things are 
going well. I suspect it's because the entrepreneurial spirit is strong, 
and so we've got to work on ways to make sure the entrepreneurial spirit 
remains strong all around the country.
    I've got some ideas. One is to make sure the budget is wise. I'm 
looking forward to working with Judd and Members of the House and the 
Senate to say, ``We'll set priorities with your money. We'll make sure 
there's clear priority. If a program doesn't work, we need to eliminate 
it.'' We need to be wise about spending the money. And I think that will 
set the tone for future economic growth, when people see that we're 
serious about dealing with our deficits.
    We're going to do something about lawsuits. The Senate voted out a 
good bill on class-action lawsuits. There's more lawsuit reform that 
needs to be done. I'm looking forward to working with the House and the 
Senate. We want to make sure the scales of justice are balanced. And 
they're not balanced around this country when frivolous lawsuits make it 
hard for small businesses to expand their employee base, and they're not 
balanced when doctors are getting run out of practice. This Congress 
needs to do something about asbestos, and they need to get a medical 
liability reform to my desk.
    There's a lot of issues we can work together on to make sure that 
the economy continues to grow. We need to get an energy policy--energy 
bill; I've put out a policy. I'm looking forward to working with Judd 
and John Sununu to get a bill out of the United States Senate that 
enhances conservation, that talks about renewable uses of energy. I am--
believe that we ought to expand nuclear power to make us less dependent 
on foreign sources of energy and, at the same time, do a better job of 
protecting our environment.
    We need to continue to provide money for technologies to make the 
cars we drive cleaner. One of these days, it would be nice if biodiesel 
or ethanol becomes even more commercially available, so that when the 
crops are up, we're less dependent on a source of energy from coming 
overseas. And so I want to work with the Congress to promote a good 
energy plan--good energy bill that will enable this President and future 
Presidents to say that we're less dependent, that we're more self-
sufficient when it comes to energy, which will be good for our economy 
and good for our national security as well.
    And now I want to talk about Social Security. And I'm sure there are 
some, when they heard the State of the Union, if they listened to it, 
that said, ``Why is he spending so much time on what had been--used to 
be called the `third rail of American politics'?'' That means, if you 
touched it, you were politically electrocuted. I guess that's what it 
meant. I've touched it. I touched it in 2000 when I campaigned here and 
around the country. I touched it in 2004, and I really touched it at the 
State of the Union, because I believe we have a problem. And I want to 
talk to you about the problem.
    And Tim Penny, my friend, former Democrat Member from Minnesota, is 
also going to talk about the problem. And I'm going to throw out some 
ideas about the solution as well, and I want to hear from our panelists 
here in a minute. Laura said, ``Make sure you tell everybody hello when 
you come, and make sure you give the panelists a chance

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to speak.'' [Laughter] So far I'm not listening to her too well. 
[Laughter]
    So here's the problem. In the olden days, in the 1950s, 16 workers 
would be paying in the system for every beneficiary. That means that the 
worker had less of a burden to pay the benefits that were promised. And 
the system was working great. And by the way, Social Security is vital. 
It's a really important system.
    But things have changed since the 1950s. First, baby boomers, like 
me and Judd and Penny and a couple others of you out there, are getting 
ready to retire. There's a lot of us. And instead of living to about 60 
years, which was the life expectancy early in the Social Security 
calculations, we're now living to 77 years, and a bunch of us hope we do 
better than that. So you got a bunch of people fixing to retire, a bulge 
of retirees coming into the system, who are going to live longer. Plus, 
the benefits promised to the baby boomers are 40 percent higher, in real 
terms, than the seniors retiring today. So just think about that aspect 
of the environment in which we live, more people, living longer, being 
promised greater benefits.
    The problem is compounded by this: There's not enough people paying 
money into the system to pay for all that. The ratio of payers to 
beneficiaries is going from 16 to 1 to 3.3 to 1 today. And when--and 
down the road it's going to be 2 to 1. So you can see the formula begins 
to get a little disturbed. It makes it hard to pay the promises. As a 
matter of fact, in 2018, the system goes into the red.
    And by the way, there's not a Social Security trust. In other words, 
people think your money goes into the trust, and it's held for your 
account, and then you get it out. That's not the way it works. It's 
``pay as you go.'' It goes in, and it goes out. And to the extent that 
there's money more than the retirees receive, like it is today, it goes 
to other programs. And so what you've got is an IOU, kind of a bank of 
IOUs. It's an important concept.
    So money that's going in is greater than money going out today for 
Social Security. But in 2018, the system goes into the red, and every 
year thereafter the situation gets worse; 2027 will cost the Federal 
Government $200 billion above and beyond payroll taxes to make the 
promises; and in 2042, the system goes broke. Those are the facts.
    Now, 13 years isn't very far down the road. You know, if you've got 
a 5-year-old child, it means when your child is getting ready to vote, 
the system goes negative. It may seem like a lot for some in the United 
States Congress who have got 2-year terms. But it's not a lot if you're 
a grandfather who's worried about whether or not your grandchild is 
going to have a retirement system that works and whether or not we've 
got the capability of dealing with the problem before it gets even 
worse, because the longer you wait, the more severe the remedies become.
    Now, I want to--I fully understand--you've got to know this about 
many of us in Congress who are discussing reforms--we understand that 
many people rely upon their Social Security check. And I know that any 
discussion about Social Security can frighten people who rely upon their 
Social Security check. I mean, I remember the campaigns where people 
would say, ``If you vote for George W., you're not going to get your 
Social Security check.'' In other words, it's been part of the political 
dynamic. People would say--even if you discussed it, that would frighten 
people. And so, not only am I going to spend time traveling our 
country--this is my ninth trip since the State of the Union--or ninth 
State--I'm going to continue traveling over and over and over again, 
making it clear to the American people we have a problem. I'm also going 
to travel over and over and over again to say to people who have 
received a check--who are receiving a check and those near retirement, 
people born before 1950, ``Nothing changes.'' It doesn't matter what the 
rhetoric might be, no matter what the mailers may say, nothing changes 
for people who have retired or near retirement, and that's really 
important.
    Now, I have an obligation to talk about solutions as well. And in my 
State of the Union Address, I may have been the first President ever to 
have talked about different ideas about how to permanently fix the 
problem for younger generations of Americans. And Republicans and 
Democrats have both--have all come forth with different ideas. Tim is an 
example. He is on the leading

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edge of the Social Security debate. I mean, he was talking about it way 
before I was even thinking about running for President. And he's had 
some interesting ideas, and I mentioned his name in the State of the 
Union as being the kind of person who had the courage to step up and 
say, ``Here are different options.'' And it's important to keep the 
options on the table. And it's important for me to say to the Members of 
Congress, ``If you've got a good idea, bring it forward. There will be 
no political retribution.''
    President Clinton thought raising the age might have made sense. 
Daniel Patrick Moynihan had an idea. Tim Penny had some ideas. And so my 
message today is: Bring them forth; let's sit down at the table and 
discuss ways to permanently fix the system. I'm openminded. And I think 
that's what you want from your President at this point--not for me to 
prescribe the solution, because I don't get to write the law, but to 
call Members forward and say, ``We'll work with you. We'll look at all 
the different options, with the exception of the payroll tax increase.''
    Now, I've got an idea that I'd like for Congress to consider, and I 
want to share the idea with you here. It's a novel idea--oh, it's really 
not that novel. As a matter of fact, it's a part of the Federal employee 
retirement plan. It's a thrift benefit plan. It's a plan that allows 
Federal employees to set aside some of their money and put it in safe 
stocks and bonds, so they get a better rate of return on their money 
than they would otherwise. So it's not new. The idea of allowing people 
to invest their money, their own money, is not a new thought. That's 
what's already happening with Federal employees. I'm the kind of fellow 
who believes if it's good enough for Federal employees, it ought to be 
considered for younger workers. In other words, there ought to be a--and 
that's the idea of letting younger workers set aside some of their own 
payroll taxes in a personal savings account.
    The benefits are these, in my judgment: One, you get a better rate 
of return on your money than that which is in the Social Security 
system. If you're a younger worker, and say--my proposal is, is that you 
can put 4 percent of your payroll taxes in the account, and the rest of 
it, obviously, will go into the Social Security system. If you're a 
younger worker who averages $35,000 over your lifetime, and you put the 
money set aside--the 4 percent allowed to be set aside into a personal 
account, because of the compounding rate of interest, that will 
accumulate--you'll accumulate $250,000 when it comes time to retire. So 
you've got money in the Social Security system, however much Congress 
can afford, plus your own nest egg of $250,000. That's for a worker who 
earns $35,000 over his or her lifetime.
    And the reason why the money grows is because interest compounds. 
I'm trying to sound like an economist; I was a simple history major. But 
nevertheless, people--if you keep reinvesting in safe stocks and bonds, 
money grows. And it's important for younger workers to be able to watch 
their money grow.
    Now, you can't take that money and put it in the lottery, in all due 
respect to those who like the lottery. In other words, there's going to 
be some safe guidelines. We've already done this. The Federal employee 
benefit plan does just that. It says, ``Here is a conservative mix of 
stocks and bonds available for you to get a better rate of return than 
that which you get with your money flowing through the Social Security 
system.''
    It makes sense for younger workers to hold their own account, 
because when they pass on, they can leave their own assets to whomever 
they choose. I think that's a wonderful idea.
    Certainly the personal account doesn't fix the system. There needs 
to be better reforms, more meaningful reforms than that. But what the 
personal account will do, it will make it more likely--it will make it 
so that a younger worker gets closer to the promises made, because of 
the compounding rate of interest.
    There's going to be a lot of discussion about how to fund these 
accounts. I look forward to working with Congress. I'm interested; I'm 
openminded. One of the suggestions we made is the accounts start very 
slowly, so they become easier to finance, and they grow over time. 
Senators and Congressmen may have different ideas. I just want the idea 
of people being able to manage their own money to be a part of the 
debate. It makes

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financial sense, and it makes sense to promote ownership in America. I 
think that when more people own something, the more they'll have a stake 
in the future of this country.
    Now, a couple of other guidelines that you need to know about, and 
then we'll get to our panel. Laura's voice is beginning to kind of echo 
in my ears. You can't take all your money when you retire and take a 
trip. In other words, this is your account, but there's got to be 
guidelines because the account is set up to help supplement your Social 
Security check. And so you can't withdraw it. There will be withdraw 
requirements, for example.
    However, if you do pass it on to a survivor, that survivor can 
liquidate the account and live on it, which oftentimes does not happen 
in Social Security today. For example, if a person were to die prior to 
60 years old, all the money going into the account--and the kids are 
over a certain age--all the money in the account goes away. I've talked 
to widows who would like to see at least something left over for all the 
hard work their husband has done--or vice versa, if the woman is working 
and the husband is the beneficiary--that there's an account to pass on.
    So what I'm telling you is, is that there's ways to make this system 
conservative, is the right word to use. It's easy to come--develop a mix 
of stocks and bonds that can beat the rate of return that the money now 
earns in the--going through the Social Security system and enable a 
younger worker to have a compounded rate of interest that grows over 
time. And that's what I want the Congress to discuss and think about.
    I understand it's novel and it's different. But when the Members of 
Congress think about it, it's not all that novel and different. And 
we're going to talk to some people who are thinking about 401(k)s, what 
that means. We're developing an investor society.
    Let me conclude by this thought: Investors aren't just Wall Street 
people, as far as I'm concerned. You've got ``the investor class''--if 
you think about that, that means only certain people are capable of 
investing. I disagree. I think every citizen--every citizen--has got the 
capacity to manage his or her own money. And if they don't, we'll help 
them understand how to, and the rules will be such that they can. And I 
believe the so-called investor class ought to be every American, 
regardless of his or her background.
    So that's what's on my mind, Social Security. And I'm excited about 
the issue. I like getting out with the people and talking about it, and 
I told Tim this coming in. He said, ``Mr. President, you're going to 
have to work this issue.'' I said, ``Don't worry about it. Every week, 
I'm out of Washington, DC, in forums like this.'' And I'll continue to 
do it. I'm going to talk to the American people over and over and over 
again until the Members of Congress recognize we have a problem. And 
then I'm going to ask them the same question that people have asked me, 
``If we've got a problem, what are you going to do about it?'' People 
expect us to lead on this issue. They expect us to put our parties aside 
and move forward on this issue to solve the problem for the American 
people, which is exactly what we're going to do.
    And here's a guy--he is a man who has put party aside, put his 
country first. He's served as a United States Congressman from 
Minnesota, like I told you. And he is our expert on the subject. He's a 
senior fellow at the Hubert H. Humphrey Institute Policy Forum in 
Minnesota. Thanks for coming. Give us your thoughts.
    Representative Timothy J. Penny. Well, thank you, first of all, Mr. 
President, for your leadership on this issue, because this is the most 
important domestic program ever created. It's provided enormous security 
to senior citizens in America, that they know they have a safety net 
they can't fall below, and that's important to maintain. But as you've 
articulated, we need to strengthen this program for the 21st century. It 
was created 70 years ago, different time, different place, circumstances 
have changed. We've got new generations coming along, and they 
rightfully are worried about the future of this program. And we need to 
give them a voice in how to change this program for the future.

[At this point, Representative Penny, senior fellow and co-director, 
Hubert H. Humphrey Institute Policy Forum at the University of 
Minnesota, Waseca, MN, made further remarks.]

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    The President. Yes. Let me just give an example. Today, a retired 
average-wage earner gets 14,200 a year in benefits. So think about what 
two workers per beneficiary means. It means that one worker would have 
to pay $7,000 to support that retiree. So my--sorry, Tim, I'm just 
trying to quantify the burden.
    Representative Penny. That's fine. And it does put it in very real 
terms, because that's a big chunk of change. I was at a dinner last 
night with another leader on this issue, retired Congressman Charlie 
Stenholm, and he said, ``Well, I've got it all figured out. Since 
there's only going to be two workers to support my retirement, I'm 
picking Tiger Woods and Jessica Simpson.'' [Laughter] But we don't have 
that luxury.

[Representative Penny made further remarks.]

    The President. Tim, help me on this. I need for you to, if you feel 
like it, talk to the seniors who are receiving checks today. I mean, 
people have got to understand--I know I sound like a broken record, but 
I've heard people say, ``Well, he's talking about Social Security 
reform. It means seniors aren't going to get their checks or are not 
going to get their full amount promised.'' You've looked at this----
    Representative Penny. Well, I can talk to this on two levels, one, 
as a member of your Commission a few years ago. We said that all changes 
would be phased in over time, so anyone that's currently retired or 
anyone that's near retirement would be in the traditional system, the 
current system, no changes whatsoever.
    But I can also speak to this from my own life experience. My mother 
lives on Social Security and nothing else, so she's in that category of 
people that rely on this current system. And for her there will be no 
changes. I have two younger brothers who are disabled, and they get 
disability assistance, and we're going to protect that program for those 
people that need the program. So that's a separate issue. We're talking 
about what we need to do for the next generation of workers coming along 
and how to strengthen and improve this system for them. So they're 
really separate issues.
    The President. Perfect. All right, Frank, Frank Partin and his 
daughter, Amy. It's a interesting idea, whoever--I want to congratulate 
the people who picked our panelists, because this is really a 
generational issue when you think about it, in many ways--dad/daughter, 
retired/not retired. [Laughter] Frank, what did you do? What did you do 
here?
    Franklin Partin. Thank you, Mr. President.
    The President. How did you make a living for a while?
    Mr. Partin. How did I make my living, Mr. President?
    The President. Yes.
    Mr. Partin. I was in the Air Force for many years, and I----
    The President. There you go. Thanks for serving. [Applause] I 
appreciate that.
    Mr. Partin. I beg your pardon?
    The President. I appreciate it, and so do the people out here, 
obviously.
    Mr. Partin. Thank you. We appreciate you, Mr. President.
    The President. Well, thank you.
    Mr. Partin. My name is Franklin Partin, Jr. My wife and family and I 
reside in New Boston, New Hampshire. My lovely wife----
    The President. Where is she?
    Mr. Partin. Right down there in the blue jacket.
    The President. You're right. She is lovely. We'll see you 
afterwards.
    Mr. Partin. I'm 69 years old. I've been retired for about 6 years 
now. And I'm receiving Social Security. It comprises about 40 percent of 
our retirement income. I'm very thankful for it. But I recognize that 
there's a serious problem with it, and I appreciate the plan that you 
have because I think it's something that my daughter, when she gets to 
be my age and wants to think about it, will have something viable to 
count on.
    The President. So Social Security is important for you--obviously 
not to the extent that it's important for Tim's mom, but 40 percent of a 
person's money, what they're living on, is important. And as you discuss 
this issue with people, Frank, you hear people say, ``Yes, it looks like 
Congress is going to reduce my benefits for retired people.'' Is that 
out there still?

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    Mr. Partin. I've heard things like that, but that's not my 
experience at all.
    The President. It's not what you're thinking. That's good to know. 
Well, it's not going to happen. And this is important. I'll you why it's 
important, because once the people who get their Social Security checks 
realize nothing changes, then all of a sudden they're going to start 
saying, ``How about my daughter? What are you going to do about the next 
generation coming up?'' One of the great things about the generation 
which is retired is they've always worried about the next generation. 
And that's what we need to be worried about. That's why Frank has agreed 
to stand here in front of all these cameras, sitting up here with the 
President, worried about speaking, I'm sure, because he was worried 
about his daughter. That's why he came--once he's assured that the 
check, his check, isn't going to change.
    And by the way, before I talk to Amy, I do want to say something to 
the people who are going to be voting on this legislation. Once the 
seniors realize nothing changes, the voices you'll hear from are the 
Amys of America who are saying, ``Mr. Elected Official, what you going 
to do about it to make sure I don't get stuck with 200 billion a year, 
near 300 billion a year deficits over time? Why don't you address the 
problem now and not wait and pass it on so the next generation coming up 
has to deal with it?''
    So Dad did good, didn't he? Your dad did good?
    Amy Partin. Yes, he did.
    The President. Yes. All right, Amy, what do you do?
    Ms. Partin. My name is Amy Partin. I'm a senior at the University of 
New Hampshire at Manchester. I'm studying English.
    The President. Good, yes. I could use a few lessons. [Laughter]
    Ms. Partin. I'll see you afterwards. [Laughter]
    The President. Yes, quick tutorial. [Laughter]
    Ms. Partin. I am also working as a part-time tutor as I go to 
school. [Laughter]

[Ms. Partin, student, University of New Hampshire at Manchester, New 
Boston, NH, made further remarks.]

    The President. Interesting idea, isn't it? Here's a person getting 
ready to get out of college, and she says she's thinking about how to 
save her own money. And remember, the payroll tax is not the 
Government's money; it's your money. And I think the people--there are a 
lot of young people around America saying, ``Why don't you think of a 
system that will work, that enables us to watch our assets grow.'' I 
think there's nothing healthier for a society in which they see an asset 
base grow.
    And by the way, Amy, because she's younger, can find a--amongst 
conservative portfolios, a little higher return portfolio, and as she 
gets ready to retire, can shift from stocks and bonds to Treasury bills 
or whatever may be available at the time, so that it can--it helps to 
make sure that you deal with market adjustments. But over time, money 
grows. That's what Tim's committee, I suspect, discovered. They 
discovered--you might assure people of that.
    Representative Penny. Well, we did ask the Social Security actuaries 
to run numbers on what a modest account for young workers would mean to 
them over the course of their lifetimes, contributing 4 percent of 
payroll per year into these accounts. And in every instance, they did 
markedly better than what the current system is promising them. And bear 
in mind, the current system is promising them about 30 percent more than 
it can pay them, because there won't be enough money in the current 
system to pay them. So with these personal accounts, they come out 
better, even assuming very conservative growth in their fund over the 
course of their working lives.
    The President. So if she starts early with her own money, which I 
think you just told me you'd like to do----
    Ms. Partin. That's right.
    The President. ----it grows. It grows to a substantial amount. If 
you think about the worker making 35,000 over his or her lifetime, and 
they set 4 percent of the payroll taxes aside and it turns into 250,000, 
imagine the person who makes 50,000 over his or her lifetime, or 70,000. 
In other words, we're talking about the accumulation of significant 
amounts of wealth to help complement, not replace but complement the 
Social Security

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check. And that's important as well for people to understand.
    We've got us a dairy farmer with us. That would be you, Bill.
    William Yeaton. Yes, welcome to New Hampshire.
    The President. Did you ever envision coming off the dairy farm to--
lending your wisdom here about Social Security?
    Mr. Yeaton. Up at 4 this morning, quick shower, and now we're down 
here.
    The President. That's good. [Laughter] Like, when was the last time 
you wore a tie, just out of curiosity? [Laughter]
    Mr. Yeaton. It wasn't yesterday. [Laughter]
    The President. That's good. [Laughter] I don't blame you, man. I'm 
stuck, though. [Laughter]
    Mr. Yeaton. Well, my name is Bill Yeaton. I'm here with my wife, 
Cerina.
    The President. Where is she? Thanks.
    Mr. Yeaton. The girl beside her, Shannon, my daughter, and Samuel, 
and also my mother, Beulah.
    The President. Good, talk to Mom, that's for certain.
    Mr. Yeaton. So we're----
    The President. Is your mother still giving you instructions?
    Mr. Yeaton. I was getting dressed this morning, so I was getting 
some help. [Laughter]
    The President. So is mine. [Laughter]
    Mr. Yeaton. And I was up--[laughter]--I was up most of the night, 
hoping I wouldn't forget their names, so we got that by--we have to keep 
going.
    The President. Yes, that's good. [Laughter] So you're a dairy 
farmer. A little bit about the history of the farm, just out of 
curiosity.
    Mr. Yeaton. The history of the farm, I'm fourth-generation dairy 
farmer.
    The President. Same farm?
    Mr. Yeaton. Same farm.
    The President. Fantastic.

[Mr. Yeaton, co-owner, Yeaton Dairy Farm, Epsom, NH, made further 
remarks.]

    The President. That's 4 percent of the payroll tax. It's not 4--I 
mean, it's 4 percent out of the payroll tax; that's important. So it's 
like a third of the payroll tax.
    So how is the milk business?
    Mr. Yeaton. Last year, we had a pretty good year. The cows are doing 
well.
    The President. It's never good enough, though, if you're a farmer, 
right?
    Mr. Yeaton. I was going to sit up here and say we need more milk----
    The President. Wait a minute. [Laughter]
    Mr. Yeaton. ----the price of milk is too low.
    The President. Write your Congressman. [Laughter]
    Mr. Yeaton. I practiced that speech last night, talking about milk 
prices, and said, ``No, we're not going to use that.''
    The President. Okay, good, yes, thanks. [Laughter] So you and your 
wife have got a 401(k)?
    Mr. Yeaton. Oh, yes, my wife has a 401(k).
    The President. She's got the 401(k)?
    Mr. Yeaton. Yes.
    The President. Everybody know what a 401(k) is? It's a defined 
contribution plan. You contribute your money into a plan and watch it 
grow. When I was your age, I don't--let me say when I was younger than 
your age, there weren't a lot of 401(k)s. I don't remember coming up 
talking about 401(k)s. And by the way, I never remember, when I was 
Amy's age, talking about whether Social Security would be around. I 
mean, baby boomers just assumed it would be around, and it is for us. 
This is an interesting dialog, isn't it? The dynamics have shifted a 
lot. Here we've got a dairy farmer talking about how he and his wife 
manage their own money. That's what you're doing, right?
    Mr. Yeaton. Yes. In the old days, they used to say, ``Farmers don't 
retire. We just pass on.'' But that has changed.
    The President. That's good, pretty good. A little agricultural humor 
there. [Laughter] But you're managing your 401(k). Think about what has 
changed in society. You've got younger folks saying, ``We're managing 
our own money. We're looking after our own money. We're watching the 
401(k) grow. We're making decisions.'' And so the idea of extending what 
is happening in society to Social Security seems like to make a lot of 
sense, doesn't it?
    This is a society where younger folks are saying, ``Just give me a 
chance to watch my

[[Page 246]]

own money grow and, at the same time, go milk those cows.'' [Laughter] 
Are you still milking them by hand here in New Hampshire?
    Mr. Yeaton. Oh, no. We've got a state-of-an-art process.
    The President. You're mechanized? That's good. [Laughter]
    Mr. Yeaton. We had to change our 70-year-old plan too.
    The President. There you go. [Laughter] Very good.
    And finally, Marlo Downer is with us. Thank you for coming, Marlo.
    By the way, good job, Bill. For a farmer, you're pretty darn 
articulate. [Laughter]
    Marlo, tell us about yourself. Where do you work?
    Marlo Downer. I work at Wentworth-Douglass Hospital in Dover.
    The President. Dover? Hospital? Very good. Mom?
    Ms. Downer. I'm a single mom of a 13-year-old son.
    The President. Where is he?
    Ms. Downer. Douglas.
    The President. Hey, Douglas. Like teenage years?
    Ms. Downer. Yes.
    The President. Interesting experience.
    Ms. Downer. Oh, yes. [Laughter]
    The President. I've been through them. [Laughter] I like to tell 
people, Marlo has got the hardest job in America, being a single mom. 
And she's worried about retirement.

[Ms. Downer, intensive care unit nurse, Wentworth-Douglass Hospital, 
Dover, NH, made further remarks.]

    The President. And so, let me ask you, in your plan, how often do 
you get a statement, just out of curiosity? Quarterly?
    Ms. Downer. I believe it's quarterly.
    The President. Yes. That makes sense, doesn't it? I mean, I think 
it's kind of a reminder about the need for people to pay attention to 
policy or know what the Government is doing with your money as you 
watch--on a quarterly basis, watch your asset base begin to grow. And 
that's important.
    And so, tell us about Social Security. Here's your chance, with 
everybody watching.

[Ms. Downer made further remarks.]

    The President. Are you aware of the problem? Obviously, otherwise 
you wouldn't be sitting here. But I mean, I just wonder how often 
people--how aware people are that we have a serious problem. That 
chart--and this chart, by the way, which is reality, just shows how big 
the deficits are, starting in 2018. I mean, it's like you wait, and 
then, all of a sudden, you've got to come up with 200 billion in 2027, 
and like in 2032, you've got to come up with 300 billion, just to stay 
even for the year.
    I mean, are people beginning, around the old nursing station, to 
start kind of talking about it yet?
    Ms. Downer. I really haven't heard it around the nurses station yet.
    The President. They're going to, after you get back--[laughter]--
aren't they?
    Ms. Downer. Oh, yes.
    The President. By the way, on the Medicare drugs, we're fixing it. 
We got a new system that we put in place to make sure that the seniors 
who have trouble affording prescription drugs get help through Medicare. 
So they don't have to worry about that anymore, starting next year, by 
the way--next year. And it's going to be a great change.
    But back to Social Security. So what Marlo wants to know is whether 
or not we've got the courage, the political courage, to take this issue 
on and solve it. That's what she wants to know. And what I want to 
assure you all is that I like calling Congress to do big things, because 
that's what we got elected to do. And I'm going to continue pressing 
this issue and pressing this issue and pressing this issue and--until we 
get something done.
    I want to thank you all for your interest. I want to thank you for 
your interest. I would tell you, you don't have to worry about your 
Senators. They're forward-thinking people who understand we've got to 
address this problem today. They understand that, and I'm looking 
forward to working with them on it. I'm looking forward to giving them a 
ride back to Washington. [Laughter] I'm looking forward to talking about 
what they've heard here. I want to thank you for your time. I want to 
thank our panelists for doing such a fabulous job. I appreciate it.

[[Page 247]]

    And in the meantime, may God bless you all. Thanks for coming.

Note: The President spoke at 11:50 a.m. in the Pan Am Hangar at Pease 
International Tradeport Airport. In his remarks, he referred to W. 
Douglas Scamman, speaker, New Hampshire House of Representatives; Thomas 
R. Eaton, president, New Hampshire Senate; Richard M. Flynn, 
commissioner, New Hampshire Department of Safety; President Hamid Karzai 
of Afghanistan; 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; 
professional golfer Tiger Woods; and entertainer Jessica Simpson. The 
Office of the Press Secretary also released a Spanish language 
transcript of these remarks.