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Snowe Wary Over Social Security

Moderate GOP Senator Voices Doubts About Bush's Plans

By Mike Allen
Washington Post Staff Writer
Monday, January 24, 2005; Page A03

Sen. Olympia J. Snowe of Maine, a moderate on the Finance Committee who will be at the center of negotiations over Social Security legislation, yesterday became the latest Republican to express reservations about President Bush's plans, saying that voters are leery and Congress must act cautiously.

"There is a lot of fear among seniors," Snowe said on CNN's "Inside Politics Sunday."

Rep. Bill Thomas (R-Calif.) said he wants to look at possible new ways to finance Social Security. (File Photo)

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From the Capitol's other chamber, House Ways and Means Committee Chairman Bill Thomas (R-Calif.) used an appearance on NBC's "Meet the Press" to elaborate on his call for a far broader review of Social Security than the White House envisions.

Thomas, like Snowe, questioned Bush's description of the outlook for Social Security as a "crisis."

Thomas said he wants to look at new ways of financing Social Security and said one possibility is a value-added tax -- a consumption tax, widely used in Europe, that is added at each stage in the production of goods and services.

"The United States is the world's largest importer and the world's largest exporter, and our tax system is out of sync with the rest of the world," he said. "We pay their social costs; they don't pay ours."

Thomas also said in response to a question that he would consider a national sales tax and any other "ways in which we solve our societal problems and not go back to the same old solutions which have never been long-term solutions."

Bush has not put out a formal plan. Aides said to expect more details in the State of the Union address Feb. 2.

Snowe's skepticism could force notable changes in the package, Bush's most ambitious domestic goal for his second term. Republicans said that getting her on board will make it easier to recruit a few Democrats, who will be needed to get a big enough margin to satisfy Senate rules.

Raising broad objections to the substance and presentation of the White House case, Snowe made it clear she is not convinced that a Social Security crisis has arrived, as Bush maintains. Snowe said there are "various scenarios and interpretations about that urgency."

"Public discussion thus far, without a specific proposal, has created and enhanced a lot of confusion and fear among seniors, wondering if their benefits now are going to be cut," she said.

Snowe said she does not object to the concept of personal accounts, which would allow workers who are not approaching retirement age to designate part of their payroll taxes for investment in stocks and bonds. That has a short-run cost for the government -- estimates range from $1 trillion to $2 trillion -- because that is money that would not be available to pay benefits now. And Snowe said she is "certainly not going to support diverting $2 trillion from Social Security into creating personal savings accounts."

On NBC, Thomas introduced a new and controversial possibility into the debate by saying that Congress should look at inequities in the system based on race, occupation and gender, because women live longer and blue-collar workers often need to retire earlier. Thomas said he wants to examine "the question of race, in terms of how many years of retirement do you get based upon your race."

"And you ought not to just leave gender off the table because that would be a factor," he said.

Thomas clarified his use of the phrase "dead horse" last week in reference to the expected politicization of Bush's proposal.

"I didn't say it was dead on arrival," he said. "What I said was, I hope we didn't have our friends on the other side of the aisle attacking the president's proposal once it's introduced. Because, once it's introduced, it becomes part of the legislative process. Suggest changes or suggest substitutions, but don't continue the arguments against the president's plan, because it's now part of the legislative process. That would be beating a dead horse."

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