George W. Bush's position on

Social Security: Social Security is the foundation for all Americans retirement income. This is because no one outlives their Social Security retirement benefit and your benefit will never lose its value. Yet, it has been projected that the Social Security trust fund will turn negative by the year 2012, and will be depleted by 2030, at which point the government will need to adopt alternative funding methods to meet its obligations.

Description of candidate's position: President Bush has repeatedly stressed the need for modernization of the Social Security System. President Bush believes personal retirement accounts would enable individuals to build financial wealth and security in a way that the current social security system does not. Privatization, which this is refereed to, is the idea of taking some of the money workers currently pay into the Social Security system and diverting it into individually owned accounts. He believes these personal accounts would provide ownership, choice, and the opportunity for workers to build a nest egg for their retirement and an inheritance for their families. link 

Quotation from the candidate: "On Social Security, I want the younger workers here to listen carefully to this debate on Social Security. If you're on Social Security today, nothing is going to change. I do not care what the D.C. politicians will tell you. Nobody is going to take away your benefits. And if you're a baby boomer, you're in pretty good shape when it comes to Social Security. But we need to worry about our children and grandchildren, when it comes to the Social Security system. I think we need to think differently when it comes to our children and grandchildren. I think we ought to allow young workers to put aside some of their own tax money in a personal savings account, to make sure Social Security fulfills the promise. If you listen carefully to the rhetoric in this campaign, I'm running against a fellow who wants to expand government. We need to expand opportunity for every single citizen of this country." September 13, 2004 from the Bush website

Assessment of the proposal:

Positive: Social Security Choice.org is a non-partisan, grassroots, issue advocacy group. Their mission is dedicated to the cause of modernizing and reforming the Social Security system by giving workers the option to voluntarily place a portion or all of their Social Security taxes in personal retirement accounts. This group is represented by thousands of Americans who want to have more control over their retirement futures.

Economist Doug Bandow believes that the only way to fix Social Security is to follow the Chilean model of switching to a private retirement system, where workers invest their own money for their own retirement, rather than turn it over to the government to pay current retirees. Such a system, he believes would not be difficult to implement in America.

Negative: The National Committee to Preserve Social Security and Medicare, which is the nation's second-largest grassroots citizens organization reports that privatization will replace Social Security's guaranteed defined benefits with individual investment accounts. In other words, privatization would transfer money out of the Social Security Trust Fund and have workers invest in Wall Street. This transfer would drain the Social Security Trust Fund and would force large reductions in Social Security benefits, dramatically increase taxes, or unfairly burden all Americans, young and old, with additional government debt.

David Francis, Senior Economics Correspondent for the Christian Science Monitor, believes that women, especially lower income women would be most harmed by social security privatization. He believes that since women on average earn less than men and live seven years longer, they would lose most from privatization.

Comparison: While both candidates agree that Social Security is in danger, they have different views on alternative funding methods. George Bush is in favor of modernization of the current Social Security system. He believes personal retirement accounts are the best alternative, and he has not ruled out raising the retirement age. John Kerry has a three pillar plan, however it does not go into much detail on his ideas. He has said that he is against privatization and is against raising the retirement age.

Link to Kerry's issue brief