By Lee Coleman of Aloha, Oregon. Lee is a former member of the Oregon GOP's state policy board and a founder of the Oregon Log Cabin Republicans. He is now a Democrat.
As we approach the 70th anniversary of Social Security, all Americans, particularly including gays and lesbians should understand that we have a huge stake in a reasonable approach to Social Security. President Bush's so-called privatization plan is a serious attack on Social Security and our future.
In the first place, Social Security needs more income in order to be solvent into the foreseeable future. Clearly, it does not need less income. President Bush's Social Security privatization plan is fiscally irresponsible because it would deprive Social Security of income and would pass a very substantial burden on to future generations while ignoring solutions that are both reasonable and fiscally responsible.
First and foremost, Congress should expand tax exemptions for citizen contributions to existing private savings plans, including private IRAs and 401(k) plans, in order to implement the stated purpose for Bush's proposal, namely, to encourage greater savings by the population. Secondly, Congress can add to Social Security's solvency by immediately ending all caps on FICA contributions. Thirdly, Congress could consider using special debt instruments on borrowings from Social Securityh that carry an interest rate equivalent to any reasonably foreseeable return on the proposed private accounts.
Social Security is and has been an insurance plan, not an investment plan.
The insurance aspect of Social Security would be put at an unnecessary risk in the marketplace if any part of it were to be diverted from the insurance concept to a private investment scheme. Privatization is unnecessary in view of the availability of existing private plans (IRAs and 401(k)s), that Congress could easily enhance at substantially lower cost. These are the responsible things to do.
The proposed plan is irresponsible because it envisions cuts in Social Security benefits. These would be disastrous -- and unfair -- for most Social Security recipients. The proposed plan is also irresponsible because it would require a massive increase in the national debt -- to the tune of trillions of dollars -- to finance the transition to private accounts. This is fiscally irresponsible, especially as it increases the interest/tax burden on our children and grandchildren.
President Bush's "progressive price indexing" proposal, which would redistribute Social Security contributions by any persons earning more than $20,000 per year to ensure 100% guaranteed benefit levels for those earning less than $20,000 per year, is akin to transforming Social Security from a guaranteed earned insurance system to that of a welfare system.
Log Cabin Republicans, which I used to be involved with, endorse Bush's ridiculous plan despite its irresponsibility. Log Cabin and other Republicans should realize that the Bush plan has already contributed to a lack of trust in government among Americans of all political persuasions. It is up to us to take leadership in convincing our representatives to exercise strong leadership in the interests of fiscal responsibilty restoration of our trust in our government.