Today wrapped up the White House Conference on the Economy. In the morning session President Bush led a panel entitled "Financial Challenges for Today and Tomorrow." The main focus of this panel was long term deficits due to unfunded mandates, particularly social security and Medicare. The President began by outlining his own 3 key points to social security reform:
1. No change for those in or near retirement.
2. Do not raise payroll taxes
3. Allow younger generations to use own payroll taxes for personal savings accounts.
The panelists all seemed to agree that the old methods used to fix social security, namely increase payroll taxes or decrease benefits, simply will not do. The system itself is broken. Instead of tweaking the old, a new social security infrastructure must be established. The key to this new architecture should be private accounts, according to the panelists. These private accounts would allow people to invest their own money into savings accounts for their retirement, but give them flexibility to invest what they want and also to do what they see fit with the money, such as pass it on to family.
One of the main themes of the morning session was ownership, as illustrated by the personal account concept. Free markets and entrepreneurial spirit were heralded as the driving forces of a strong economy. Personal accounts demonstrate the concept of using ownership as a means to strengthening the economy and avoiding the pitfalls of long term debt. The President affirmed his belief in the American people and a system of ownership through two statements:
"Citizens can affect policy"
"I love the idea of people being able to own something"
Private ownership and believing in the people of America to spur on change. Ah, the beauty of a capitalist democracy in action.