Experts Consider Social Security Pitch

Feb. 5, 2005 — -- President Bush began telegraphing his intent to convince Congress and the rest of us of a genuine Social Security crisis in December.

"You may not feel it," he said. "Your constituents may not be overwhelming you with letters demanding a fix now, but the crisis is now."

That sense of urgency is essential to the president's pitch. A White House political aide named Peter Wehner clearly spelled out the tactic in an e-mail to political allies in January.

"Our strategy will probably include speeches early this month to establish an important premise -- the current system is heading for an iceberg," the e-mail said.

Soon, the president was sounding a dire alarm for America's youngest workers.

"I want you to think about a Social Security system that will be flat bust, bankrupt, unless the United States Congress has got the willingness to act now," Bush said. "The system will be bust. In other words, there won't be anything available for you. I mean, if you're a 20-year-old person and you look at the math, you realize that you'll inherit a bankrupt system."

But by the administration's own calculations, Social Security won't hit any proverbial icebergs for years to come. Given the complexity and politics of the debate, "Nightline" recently asked two experts from the center of the ideological spectrum to help sort out the reality from the rhetoric.

Robert Bixby, who runs the bipartisan Concord Coalition, the group founded by leading Republicans and Democrats concerned about the government's finances, said describing Social Security as in crisis is "an exaggeration."

"The problem with Social Security is that it does promise more and future benefits than the current system can afford," Bixby said. "That is a problem for today's workers. And it is important that we begin to work on that problem and address it. But the system is not in an immediate crisis."

Peter Orszag, an economist who served in the Clinton administration and directs the tax policy center at the Brookings Institution, said, "There is no immediate crisis with Social Security."

"It's a long-term challenge," he added. "It's like having termites in the foundation of your house. Better address it sooner rather than later."

Still, the president has said, "The math shows we have a problem."

Here's the math: From every paycheck, 6.2 percent of your salary is sliced off for Social Security. Your employer contributes an equal slice. So an amount equal to 12.4 percent of your pay is set aside until you earn $90,000, when the deductions end.

"The average earner pays about $2,000 or so in payroll taxes directly, and then the worker's firm pays another $2,000 to the Social Security system each year," Orszag said. "That money goes into the system and effectively pays for current beneficiaries for perhaps the worker's grandmother or grandfather.