Commentary

Go for the Big One, Mr. Bush

During the presidential election campaign, one of George W. Bush’s most popular proposals was to allow workers to invest a portion of their Social Security taxes in private accounts. Now that he has won — albeit by the most excruciatingly close margin — Washington pundits are advising him to abandon this proposal, concentrating instead on small “confidence building” proposals. That is exactly the wrong advice.

In fact, if president-elect Bush wants to unite the American people behind his administration and secure a place in history for something besides the “Florida miracle,” he should make Social Security reform a defining issue of his presidency.

If next summer the American people are still talking about chads and butterfly ballots, the Bush administration will be in trouble. A series of tiny, inconsequential initiatives, no matter how well intentioned, will do nothing to redefine a Bush presidency. Instead, he must find a “big” issue to focus the public’s attention, an issue that can both excite and unite the American people. Social Security can do that.

According to election night exit polls, 57 percent of American voters support partially privatizing Social Security. That makes Social Security privatization arguably more popular than Bush himself. If he is going to pick an issue to stake his political capital on, it seems logical to pick one that already has the support of a majority of Americans.

Social Security privatization is also an issue that offers a unique opportunity for Bush to reach out to those who did not support him in the election. Bush received the smallest percentage of the African-American vote of any Republican candidate in recent history. But African-Americans, with shorter life-expectancies and less accumulated wealth, are among the groups that stand to benefit most from Social Security privatization. Polls consistently show that African-Americans support private investment of their social Security taxes. This is an opportunity for President Bush to appeal to blacks on far more than a symbolic basis.

Likewise, Republicans are still perceived as a party that favors the wealthy. But the wealthy already have the advantage of being able to invest in private markets and accumulate wealth. The poor have no discretionary income to invest, especially after being forced to pay 12.4 percent of their income in to a failing Social Security system that provides them with absurdly low rates of return. Social Security privatization would allow low-wage workers to save, invest and accumulate wealth. It would be hard to think of a better example of compassionate conservatism in action, giving every truck driver, waitress and lathe operator the same opportunity to participate in the American economy as their wealthier counterparts. Imagine the transformation of American politics when there is no longer a divide between labor and capital—because every laborer is a capitalist.

Will Social Security privatization be easy to shepherd through a closely divided Congress? Of course not. But it offers an opportunity for the type of bipartisan cooperation Bush has talked so much about. A number of prominent Democrats such as Sen. John Breaux of Louisiana and Rep. Charles Stenholm of Texas support individual accounts.

On the other hand, little initiatives will not necessarily be any easier to pass. Some Democrats will be anxious to kill any Bush initiative to make him look ineffective and to taint his presidency. With small initiatives, there will be no political price to pay for such obstructionism. That’s not the case with Social Security privatization. If Democrats decide to oppose an idea supported by 57 percent of American voters, Bush will have a ready-made issue in the next election.

Bush’s victory could not have been narrower. But that doesn’t mean he should be a timid president. A bold move on Social Security reform wouldn’t just be the right thing to do for the country, it would be the right thing to do for his presidency.

Michael Tanner is director of the Project on Social Security Privatization at the Cato Institute and co-author of A New Deal for Social Security (Cato Institute, 1998).