Conservative Proposal I By the President G. W. Bush Commission to Strengthen Social Security

Jagadeesh Gokhale

in Social Security

Published by University of Chicago Press

Published in print April 2010 | ISBN: 9780226300337
Published online February 2013 | e-ISBN: 9780226300368 | DOI:
Conservative Proposal I By the President G. W. Bush Commission to Strengthen Social Security

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The election of President George W. Bush in the year 2000 was very encouraging for proponents of Social Security privatization. The election campaign was successful despite “touching the third rail” of Social Security reform, including mention of the possibility of introducing personal Social Security retirement accounts. The new administration's emphasis on creating an “ownership society” meshed well with conservatives' long-held desire to transform Social Security—a program that involves high government taxes to finance retirement benefits and one that many conservatives believe should be called “welfare for the middle class”—into a new program whereby individuals would own, control, and dispose of their retirement assets themselves. The focus of the Bush administration's Social Security Reform Commission was to finance such accounts by implementing a quid pro quo with the traditional program's future benefit commitments. Workers who choose to participate in the new Social Security individual accounts (IA) system would be allowed to divert a part of their payroll taxes into such accounts, but, in exchange, they would receive reduced future benefits from the traditional program.

Keywords: George W. Bush; Social Security; Reform Commission; payroll taxes; workers

Chapter.  8533 words.  Illustrated.

Subjects: Public Economics

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