- The Washington Times - Thursday, July 26, 2001

Some of the same Democratic leaders who are now accusing President Bush's Social Security reform commission of exaggerating the program's financial troubles were among those a few years ago who warned that the system needed fixing to avoid bankruptcy.
House Democratic Leader Richard A. Gephardt, Senate Democratic Leader Tom Daschle and some liberal advocacy groups have criticized the commission's first report, accusing it of presenting "a biased, misleading picture." They say that the report pushes a privatization plan that would cut benefits and destroy the system.
Mr. Gephardt charged Monday that the commission, which is evenly divided between eight Republicans and eight Democrats, was "trying to undermine public confidence in Social Security and scare people into thinking we have no choice but to cut benefits."
But at the end of 1998, Mr. Gephardt said that Congress not only needed "to shore up the financial structure of Social Security," but also agreed with Republicans that individual, private Social Security investment accounts "can be part of the answer."
Speaking at a two-day White House conference on Social Security's shaky financial future on Dec. 8, 1998, he called for a voluntary plan that would supplement Social Security. A news report at the time said that "Gephardt's suggestion, the first of its kind by a major Democratic leader in Congress, opens the door a bit wider to enact some form of private accounts" that would allow investment in stocks and bonds.
Such private accounts would be a supplement to Social Security, "not a replacement," he said. But Republican officials yesterday said that other than the issue of financing, the House minority leader's proposal was similar to what the commission is in the process of designing.
Democratic leaders and groups like the AARP (formerly the American Association of Retired Persons) complained this week that the commission was irresponsibly warning that the program would be in financial trouble as early as 2016 and would be bankrupt by 2038, when, they said, no such threat exists.
Mr. Gephardt said "the Social Security system is fundamentally strong for many years to come."
But President Clinton, in a major address on Social Security on Feb. 9, 1998, that kicked off a national dialogue on reforming the system, said that "all of you know that the Social Security system is not sound for the long term."
The nation's economic prosperity, especially the poor and low-income groups were "threatened by the looming fiscal crisis in Social Security," Mr. Clinton said.
No one in a leadership position in his party challenged his assessment at the time.
Now, Democratic leaders were arguing with nearly every finding in the commission's interim report, approved on Tuesday — especially the one that said that Social Security, unlike private funds, has no real assets that future beneficiaries can depend upon. Mr. Daschle maintained that the Social Security trust fund was invested in government bonds that could be redeemed at any time and that it was irresponsible to suggest otherwise.
But Mr. Daschle said just the opposite in a 1996 interview with columnist Robert Novak who asked him, "Do you believe there is a Social Security trust fund?"
Mr. Daschle replied, "Ah, yes, I do." But when pressed on whether such a fund existed, Mr. Daschle said, "No, there is no such fund."
That is also what the last Democratic administration said as well. "The Trust Fund balances do not consist of real economic assets that can be drawn down in the future to fund benefits," Mr. Clinton said in his fiscal 2000 budget.
The commission quotes a number of government agencies to back up its contention that with millions of retirees demanding retirement benefits in the future and fewer workers and payroll taxes to finance these benefits, the system will begin facing a shortfall in just 15 years.
Commission officials said yesterday that they were disturbed by the partisan attacks on their report.
"I think the commission is concerned about the tone of the discussion. They put out a report that was purely factual, based on projections that have been in the public record for some time," said Charles Blahouse, the commission's executive director.

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