FIXING SOCIAL SECURITY

February 2005
		President Bush has launched a national campaign to generate support for his plans to reshape Social Security, including the controversial option of personal investment accounts for younger workers. Two experts answer your questions about the personal accounts and other aspects of the president's plan. Special Report: Social Security Reform

Forum Introduction What are Bush's plans for Social Security disability? Didn't Great Britain undertake the personal accounts experiment with their version of Social Security to detrimental results? How do the personal accounts affect employers' contributions to Social Security? How would removing the $90,000 income limit on Social Security taxes affect the system's future? What happens if a person's private account runs out? How will the average person who knows nothing about investing fare under President Bush's new plan? How does the federal Thrift Savings Plan differ from Social Security? Under the personal accounts proposal, will there be fees for investing, and who and how will they be paid? If the IOUs in the Social Security trust fund were paid, would the system remain solvent for a much longer time? Why would anyone want to change Social Security, an insurance program, into a savings account? I'm 48, how drastic are my benefit cuts going to be?	President Bush urged Congress to revamp Social Security during his State of the Union address Feb. 2, warning the program would go bankrupt if changes were not made. "Social Security ... on its current path, is headed toward bankruptcy. And so we must join together to strengthen and save Social Security," he said. The next day he launched a five-state, two-day trip to try to persuade lawmakers in North Dakota, Montana, Nebraska, Arkansas and Florida and the general public that the social program needs restructuring. Although he said all options are on the table, from increasing the retirement age to changing the way benefits are calculated, he said certain guidelines must be followed: payroll taxes won't increase and benefits won't change for those 55 years or older. In particular, President Bush is promoting the controversial idea of allowing young workers to put some of their Social Security contributions into personal investment accounts (Click here for more information about personal accounts). Peter Orszag, senior fellow in economic studies at the Brookings Institution, and Michael Tanner, director of health and welfare studies at the Cato Institute, answer your questions about personal accounts and other proposed changes to the 70-year-old Social Security system.