I'm not for, quote, privatizing Social Security. I never have been. I never will be.
Scher provides a clip of McCain saying he supported privatization in 2004 and I showed up for a demonstration against privatization in Tucson, AZ, on March 21, 2005 when Bush stopped here to push his plan. McCain was on the stage with him and fully supported the proposal.
President Participates in Social Security Conversation in Arizona
Tucson Convention Center
Tucson, Arizona
March 21, 2005
(except about S.S.)
PRESIDENT BUSH: When we sit down at the table, my call to the United States Congress -- and I know Senator McCain agrees with me on this -- let's fix it once and for all. Let's do our duty and permanently fix Social Security. (Applause.)
I want to share one other idea with you, and then we're going to talk to our panelists here. It's an idea that I know that has been in the news. It's an idea to allow younger workers to take some of your own money and set it aside as a personal savings account. (Applause.) Let me tell you why I like this idea. First of all, it's voluntary. Nobody is saying to a younger worker, you must set aside a personal savings account. We're saying, you can if you want to, take some of your payroll taxes, and put it aside. After all, it's your money to begin with.
Secondly, a personal savings account in a conservative mix of bonds and stocks will yield a greater rate of return than money that -- that your money is earning now. And that's important, because over time, that money grows. Over time, there's a compounding rate of interest. Let me give you an example. If you're a $35,000 a year worker over your lifetime, and you're allowed to put a third of your payroll taxes into a personal account, and you start saving at 21, by the time you retire, that account will have accumulated $250,000. That will help you with retirement. See, money grows, and the better rate of return you get, the more the money grows. And the rate of return we're getting on your money now is abysmal compared to a mix of conservative bonds and stocks. And so, in other words, you get a better deal.
In order to fix permanent -- Social Security permanently, there needs to be some things we've got to do, and I've laid them out on the table. But this is a way to make the system work better for the individual. And I think we need to be thinking about the individual when it comes time to making the Social Security system work better, because if you allow a person to take some of their own money, and it compounds with a rate of interest, it means the nest egg that person is going to have is going to be more closely tied -- more closely resemble that which the government -- the promise the government can't keep.
Cliff Schechter and Mark Thoma provide more evidence that McCain lied today about his position on Social Security. Here's a pic from the WH site of Bush and McCain in Tucson:
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