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Correction to This Article
A Feb. 27 article about possible compromises in the debate over individual investment accounts for Social Security incorrectly described President Bush's proposal. Workers younger than 55 who opted to participate in the program would be able to divert up to 4 percent of income subject to Social Security taxation into individual investment accounts beginning in 2009.

GOP May Seek a Deal on Accounts

Anxious Lawmakers Negotiate With Democrats on Social Security Changes

By John F. Harris and Jim VandeHei
Washington Post Staff Writers
Sunday, February 27, 2005; Page A01

President Bush is still in the opening phase of a campaign to sell the public and Congress on his ambitious plans for Social Security, but some Republicans on Capitol Hill have decided it is not too early to begin pondering an exit strategy.

With polls showing widespread skepticism of Bush's proposed individual investment accounts and Democratic lawmakers expressing nearly uniform opposition, some allies of the president are focused on possible split-the-difference deals.

Some of President Bill Clinton's aides said later that he erred in not trying to reach a deal with congressional Republicans on his health care plan. (Khue Bui -- AP)

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Social Security

As described in interviews, most of these compromises would involve Bush significantly scaling back his proposals for restructuring the popular benefits program. In exchange, he could still claim an incremental victory on what he has described as his core principles: enhancing the long-term solvency of Social Security and giving younger Americans options to invest more of their retirement money.

In one example, Rep. E. Clay Shaw Jr. (R-Fla.) said, a compromise might involve merging Bush's proposal with plans -- some backed by Democrats -- that create government-subsidized savings plans outside Social Security. Under this scenario, Bush's proposal to divert 4 percent of an individual's Social Security payroll tax would become 2 percent or less.

"The president could claim a real victory just by getting personal accounts," said Shaw, who has shared his ideas with Vice President Cheney and White House senior adviser Karl Rove. "It may be that a hybrid" is the key to compromise.

Meanwhile, Sen. Lindsey O. Graham (R-S.C.) said that he is discussing with Democratic colleagues a compromise plan that would guarantee low-income beneficiaries will do better under a new program than the existing system, even if this increases the program's cost.

White House officials said Bush is open to such a compromise and will continue to signal this publicly in the days ahead.

But all this maneuvering assumes that Democrats are looking for compromise -- rather than the opportunity to hand Bush the kind of monumental defeat that President Bill Clinton suffered 11 years ago with his proposal to change the health care system. Clinton's signal error, most of his aides concluded in retrospect, was not dropping his plan in favor of a bipartisan deal on more modest legislation while he still had enough political leverage to bring Republicans to the table.

Senate Minority Leader Harry M. Reid has declared that Senate Democrats are united in their opposition to personal accounts carved out of Social Security. That is a deal-killer if true, since as a practical matter the most controversial ideas typically need a supermajority of 60 votes to end filibusters and allow a vote. Despite Reid's assertion, however, several moderate Democrats have not ruled out backing a more modest version of the president's plan.

Some of these centrists, such as Sen. Joseph I. Lieberman (D-Conn.), have been meeting with Republican colleagues to discuss whether there is a middle ground.

Even critics eager to read the obituary for the most ambitious version of Bush's Social Security plan acknowledge it is too early to write it. But the initial response suggests the idea is struggling.

Many anxious GOP legislators say they have received clear caution signals from constituents on trips home, and several polls reflect the headwind Bush is facing. Significantly, a recent Washington Post poll, conducted in conjunction with the Kaiser Family Foundation and Harvard University, showed that personal accounts win majority support from voters, but that support drops well below 50 percent when people learn details.

These details include the long-term cost of the change, which the White House acknowledges is in the trillions of dollars; the risk to people who choose the investment option; and the fact that personal accounts do not extend the solvency of Social Security unless they are paired with benefit cuts or tax increases in the traditional program.

Rove and other Bush aides profess confidence in the president's prospects. They say that Bush is still educating the public about his ideas, and note that most voters in polls accept his diagnosis that the Social Security system is unsustainable over the long term.

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