- The Washington Times - Thursday, June 13, 2002

Social Security's chief executive officer, Jo Anne Barnhart, has remained out of sight in the mounting battle over President Bush's plan to reform the nation's retirement system. But the Democrats' increasingly hysterical charges have compelled her to fire back.
Ordinarily, Mrs. Barnhart has to walk a fine, bipartisan line as the head of the Social Security Administration. While she was appointed by Mr. Bush to run the agency, her sensitive post requires her to stay out of the partisan fray. This is why her cutting loose a volley of criticisms on Mr. Bush's accusers was so surprising when she and I sat down to talk last Friday in her expansive office near Capitol Hill.
In her first interview since Mr. Bush picked her for the post last summer, Mrs. Barnhart said the "fear factor" the Democrats are deploying is "really unfortunate."
"It is important that Social Security beneficiaries be reassured," she said. "The use of highly charged, incendiary rhetoric doesn't accomplish this."
Charges being leveled almost daily by New Jersey Sen. John Corzine picked by the Democratic leaders to be their Social Security hatchet man have no basis in fact, she told me.
Among Mr. Corzine's chief charges: Benefits are going to be cut for current retirees and future retirees; that the administration is raiding the trust fund and endangering the future solvency of the program; and that if we let workers voluntarily invest some of their payroll taxes in stocks and bonds, they risk losing all of their retirement savings (this from a man who made a fortune in the stock market).
None of this is remotely true, says Mrs. Barnhart, who is intimately familiar with all reform plans now on the table. Her actuaries have crunched the numbers on them all, including the proposals worked up by Mr. Bush's commission earlier this year.
"The most important message that I want to send out is that benefits are not going to be affected," she said. "Regardless of what proposal you look at in terms of reform, I want to reassure retirees and near-retirees that they will not have a reduction in benefits."
Mrs. Barnhart said one of the most specious charges by the Democrats is that the trust fund is being robbed of worker contributions because the administration is spending the money on other government programs. She says she is constantly questioned about this by people she talks to regularly. Such questions keep her in touch with the public's concerns.
"The analogy I use is, 'Do you think that when you put your money in a bank, do you think that the money actually sits physically in the bank?' And people say 'No, the bank uses it to advance home loans, to give people loans to buy cars or invest money.' And I say, 'Right, and that's how you get interest on your money and that is exactly the analogous situation for the Social Security trust fund.'
"It's the same kind of situation, and when you explain it in those terms that people can relate to, I think they understand it. But I do think there is some degree of misunderstanding out there in terms of what happens."
In fact, the U.S. Treasury gives the Social Security program certificates that are fully redeemable at a time when the program needs additional funds. These certificates are backed by the full faith and credit of the federal government, which takes in $2 trillion a year in revenue. Mrs. Barnhart said she recently asked to see one of these certificates and described them as being as good as gold.
As for the alleged financial risks and safety of Mr. Bush's plan, she candidly states that her own federal pension is fully invested in stocks. "I'm a federal employee. I participate in the Thrift Savings Plan. I went into the stock fund," she said.
These stock funds (there are several others that federal workers can choose from) are carefully approved by the government and are "widely diversified to lower risks," she said. Or, if you prefer, you could invest in U.S. government bond funds, which pose no risks at all but would pay more than Social Security does now.
Mrs. Barnhart even went so far as to say that, in crafting its reforms, Congress would do well to "look at the Thrift Savings Plan" as the basis for a larger and likely more profitable retirement for the general public.
Needless to say, she speaks approvingly and candidly of Mr. Bush's plan: "I don't think there is any question that people, particularly younger people, would have more control over their investments in the future" under the president's reforms.
This is a gutsy, principled woman who is not afraid to say what she thinks and stand up for what she believes. She is challenging the demagogues in Congress and exposing their malicious lies about Social Security reform. And she is doing it a lot better than anyone else in the administration right now.

Donald Lambro is chief political correspondent for The Washington Times and is a nationally syndicated columnist.


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