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GOP leaders push new Social Security plan

WASHINGTON - Key Republicans rallied Wednesday behind a plan to introduce Social Security personal accounts on a more modest scale than President Bush favors.

"Our bill is the first bite at a bigger reform," Texas Rep. Sam Johnson said. Several Republicans said the proposal may be brought to the House floor next month, possibly as part of a broader measure making changes in pensions and other retirement issues.

Democrats accused Republicans of mounting a fresh attempt to privatize the Depression-era program. "This is privatization, plain and simple," said Rep. Sander Levin, D-Mich. "Just like President Bush's plan, this proposal would take money from Social Security to set up private accounts."

In a blow to the White House, Republicans said their measure will not contain any of the cost-cutting steps needed to ensure long-term solvency for Social Security - higher taxes, an increase in the retirement age or curbs in benefits.

Bush has made solvency and personal accounts financed from payroll taxes the goals of plans to overhaul the program.

While Bush has called for using current payroll tax receipts to create a permanent new option for personal accounts, Republicans opted for a different approach.

They said their proposal would strengthen Social Security. "It does stop the raid of the Social Security surplus," said Rep. Clay Shaw, R-Fla.

Officials said that under the proposal, for an initial three-year period, surplus Social Security funds would be used to establish individual accounts for willing younger workers. The money would be in the form of "marketable Treasury bonds," according to a written description, with the interest rate set by the government.

[Last modified June 23, 2005, 00:47:00]