« The Intangible Economy: Patents and innovation research | Main | I Guess I'm Not Going to Be Reading the New Republic Anymore... »

April 19, 2005

Bush's Credibility Gap

From AP:

HoustonChronicle.com - 'Credibility' gap dogs Social Security plans: By NEDRA PICKLER Associated Press: COLUMBIA, S.C. - President Bush on Monday pitched for his Social Security overhaul in this Republican-friendly state, yet a Republican congressman made clear that Bush still faces resistance within his party.... Rep. Gil Gutknecht, R-Minn., said during an editorial board meeting with the (Rochester) Post-Bulletin that Bush must overcome a 'credibility problem' to revamp Social Security. The congressman said many people think the president underestimated the cost of the Iraqi war, then overestimated the benefits of Medicare's prescription drug plan. 'And now, all the sudden, they wonder why people are a bit skeptical of their ... plan on Social Security,' he said. 'It's partly a credibility problem.' Gutknecht also rejected the Bush contention that Social Security is in 'crisis.' 'If I use the word 'bankrupt,' you know, kick me, because I don't think that's a fair term to say about Social Security,' the congressman said. 'It is not in crisis today. I don't use the word 'crisis.' '

Bush was greeted by a letter on the front page of The Columbia State, welcoming him to the state that he won handily last November but warning him that his Social Security proposal is 'going to be a hard sell, even in conservative South Carolina.' The state's senior senator, Lindsey Graham, has urged the president to switch his focus to the retirement program's looming insolvency and how to fix it. He also has broken with Republican orthodoxy to suggest that part of the solution will involve raising taxes. South Carolina's junior senator, Republican Jim DeMint, said Bush had told him that 'if it takes the last day of his presidency, he's going to work on this issue.'

After returning to the White House, Bush told CNBC that private retirement accounts are a good idea even though the stock market is slipping as investors worry about rising gas prices and the strength of the U.S. economy. 'Most people will tell you that if you hold money over a long term, the rate of return on a conservative mix of bonds and stocks clearly is greater than that which the government earns on your behalf,' he said. 'There are ways to design plans that take the risk out of a plan.'...

It's certainly true that there are ways to greatly reduce the risk to those Social Security beneficiaries who elect private accounts. But Bush's plan does not do them.

I wonder if anybody has told him that?

Posted by DeLong at April 19, 2005 09:32 PM