Giuliani Retreats From Reagan Flexibility

Oct. 17, 2007 — -- Former New York Mayor Rudy Giuliani wants to shore up Social Security by emulating Ronald Reagan and appointing a bipartisan commission to come up with ways to extend the life of the retirement program.

But while speaking to a Washington, D.C., conference of the anti-tax Club for Growth Wednesday, the national GOP front-runner retreated from the flexibility the former president used to reach a bipartisan accommodation in 1983.

"I would rule out a tax increase for that purpose, or for any other purpose," Giuliani said, when asked by Pat Toomey, the president of the Club for Growth, if he would pledge not to raise taxes to save the Social Security system.

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Giuliani intended to reassure anti-tax conservatives concerned about his refusal last month to rule out a Social Security tax increase. His comments, however, were called "a prescription for failure" by the head of a nonpartisan group that works for the system's solvency.

"If you look at the Reagan model, this is not what Ronald Reagan did," said Robert Bixby, executive director of the Concord Coalition. "Reagan's great capacity as a leader was to be able to project his ideological beliefs, but to govern in a way that would get things done with the other side. It's that second part of the equation that today's candidates seem to have forgotten about."

The bipartisan Social Security deal Reagan approved in 1983 included a combination of benefit cuts and tax increases.

Democrats accepted a six-month delay in the annual cost-of-living adjustment, and a gradual increase in the retirement age from 65 to 67, while Republicans accepted a faster-than-planned rise in payroll taxes and a tax increase on the self-employed.

The deal also subjected up to half of Social Security benefits to income taxes for higher-income beneficiaries.

Less than a month ago, Giuliani refused to rule out a tax increase to shore up Social Security.

"I am opposed to tax increases," Giuliani told The Associated Press Sept. 25, "but I would look at whatever proposal they came up with, and try to figure out how we can come up with a bipartisan way to do it."

Giuliani's AP interview sparked concern from the Club for Growth, a group whose political action committee has intervened in GOP primaries on behalf of the more anti-tax candidate.

In an "open letter" to Giuliani, which was released to the press, Toomey wrote that the AP story, "if true," would cast "doubt" on his commitment to opposing all tax increases.

The Giuliani campaign responded by releasing a letter from campaign co-chairman Steve Forbes, the magazine publisher and former Republican presidential candidate.

Toomey, who has praised Giuliani's tax-cutting record in New York, accepted the assurances contained in the Forbes letter and released a second letter urging Giuliani to "offer a detailed free-market proposal for reforming Social Security that includes personal savings accounts."

While Giuliani has not released a detailed proposal for creating personal savings accounts, he voiced his support for the concept at Wednesday's conference.

"The two things that I would be very concerned about," said Giuliani, "is that there be no tax increase and, No. 2, that we come out of it with at least the beginning of private accounts."

Giuliani's decision to unambiguously rule out a Social Security tax increase was warmly received by the anti-tax conservatives in attendance.

"We were very pleased with Mayor Giuliani's answers on Social Security," said Toomey.

While Giuliani may have protected his right flank on the tax issue with his Wednesday comments, Bixby warned that his new stance would make the job of finding a bipartisan solution to Social Security harder.

"His first answer was the right one," said Bixby, referring to Giuliani's September interview.

Bixby compared Giuliani's Wednesday remarks to Democrats ruling out benefit cuts while speaking to AARP.

"Candidates have to be very careful at these things when they are playing to the base," said Bixby.

"The real world," he added, "is not the Club for Growth."