Negotiating with Himself
From the January 3 / January 10, 2005 issue: The president's Social Security pitch needs some work.
- by Fred Barnes
Weekly Standard
AT HIS PRESS CONFERENCE JUST before Christmas, President Bush was George the Salesman, pitching Social Security reform. He failed to make the sale. He stumbled in his explanation of why the system is in trouble. He awkwardly ducked questions on the grounds that he shouldn't "negotiate with myself." Reporters hadn't asked him to negotiate, only to elaborate. Still, the president has improved at spelling out why Social Security is headed for insolvency and how investing payroll taxes in personal accounts will buttress retirement security. But he's hardly as effective as he could be.
Do the president's precise words really matter? In this fight, they do. Much of Washington is against Bush on modernizing Social Security: Democrats, the liberal lobby, AARP, the AFL-CIO, the mainstream media with the exception of the Washington Post. And many congressional Republicans are reluctant to take up the issue until they're confident of passing a bill and certain it won't come back to haunt them. So Bush must turn to the public for support, to calm queasy Republicans and to turn wavering Democrats. And to enlist the public, Bush must characterize the thrust of his plan in clear, simple, and reassuring terms.
To sell Social Security reform, the president has already adopted strategies associated with Republican consultant Frank Luntz and Presentation Testing's Richard Thau. They've derived lessons from dozens of focus groups and polls on this issue. One is that most Americans believe Social Security needs to be fixed. That's "axiomatic with the American public," Thau insists. It doesn't mean a majority agrees with the president that "the crisis is now." But neither do they accept the idea that reform should be put off until a crisis hits. So the public is receptive to the case for reform now, if Bush can make it convincingly.
Where Bush is following the advice of Luntz and Thau is in avoiding certain poisonous words. Chief among these is "privatization." Supporters of reform toss that word around to describe the process of creating investment accounts controlled by individual workers. To the public, however, it indicates corporate control of Social Security, which they oppose. Bush never utters the word. Instead of calling investment accounts funded by payroll taxes "private," he calls them "personal."
Another word dropped from the Bush lexicon is wealth, as in, Personal investment accounts would help Americans build wealth of their own. What's wrong with this? Thau has found that most Americans don't believe they're capable of creating wealth. That's for rich people. "Economists use the word 'wealth,'" says Luntz. "Average Americans use the word 'savings.'" And their saving produces a "nest egg." Thus, "nest egg" has become an operative phrase for the president. Here is what he said in his acceptance speech at the Republican convention last summer: "We must strengthen Social Security by allowing younger workers to save some of their taxes in a personal account, a nest egg you can call your own and government can never take away."
That, in fact, was an almost perfect sentence for selling Social Security reform. It had two of the three "s" words Luntz says are critical: "strengthen" and "save." Somehow the president left out the third, "secure." It would have fit as a description of the nest egg. Luntz isn't kidding about this. His "Luntzisms" often work. His recommendation that Republicans drop the phrase "estate tax" in favor of "death tax" has bolstered the drive to eliminate that tax altogether.
At last week's session with reporters, Bush got snarled in his effort to "explain the problem." It now "requires three workers per retiree to keep Social Security promises. In 2040, it will require two workers per employee to meet the promises." He meant to say that two workers won't pay enough in FICA taxes to keep benefits at the current level--that is, without a tax hike or massive borrowing. Bush also noted there's "an unfunded liability" of $11 trillion. Luntz says this phrase should be dumped because "nobody knows what an unfunded liability is."
Making the case for reform in the proper sequence is important, but Bush doesn't always do it. He touted investment accounts in exactly the wrong way at the press conference. The key idea is the accounts are owned by each taxpayer and can be inherited by children. Luntz says Bush or whoever is promoting reform needs to frequently say, "It's your money." Instead, the president began by saying individual accounts encourage an "ownership society." Second, they make "capital available." Only then did he get around to how they affect individuals. "It means that people can take their own assets, their own retirement needs, and pass them on, if they so choose, to their family members. That's positive. That's a step." And that's worth mentioning at the top of the argument.
During the presidential campaign and the recent economic summit, Bush laid down three principles for reform--and got them in the wrong order. The first is that "nothing will change if you're retired or near retirement." In other words, your benefits won't be cut. The next is that payroll taxes shouldn't be raised as part of a Social Security fix. And last, younger workers should get the option of using their payroll taxes for investment accounts.
It just makes sense to reverse the order. Why start on the defensive? Get to the good news first, that now even the poorest worker will have a chance to invest and build a nest egg. And, oh, by the way, if you're now relying on a Social Security check or soon will be, don't fret. Your check will never shrink. It will keep rising with the cost of living, forever. Bush got it right in his convention speech, broaching the issue with the promise that, with his reform plan, "more people" would "have the confidence of owning a piece of their retirement." If he can say it right once, he can do it every time, even off the cuff before a room of hostile reporters. |
