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Jewish World Review May 11, 2000 /6 Iyar, 5760

Morton Kondracke

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Voters need wonk training -- WITH THE DOW AND NASDAQ dropping, it's a gutsy -- or risky -- time for Texas Gov. George W. Bush to advocate partially privatizing Social Security. But he's doing it.

The Bush campaign calculates that enough Americans are stock market-wise and thinking long-term that this year's volatility won't scare voters into the arms of Vice President Al Gore.

Gore, of course, is sounding alarms about Bush's proposal, calling it "stock market roulette" and a "secret plan" that Gore nevertheless calculated would sap the projected federal budget surplus by $850 billion over 10 years.

Who's right? Between Social Security, taxes and budgets, this has become a presidential campaign that will require a high policy-wonk quotient among journalists trying to report it and voters trying to judge the candidates.

Is Bush's tax cut proposal "risky" and "irresponsible," as Gore claims, or entirely affordable and beneficial, as Bush asserts? Is the Social Security system "not broke," as Gore asserts, or in dire need of modernization, as Bush claims?

These are not easy questions to answer, and they get more difficult the deeper one examines them. But they are certainly big matters worth debating in a presidential campaign. And they surely beat a campaign based on personal attack.

Bush got two boosts last week. The first came from Democratic Sens. Daniel Patrick Moynihan, N.Y., and Bob Kerrey, Neb., who backed Bush's idea of private savings accounts to bolster Social Security and urged Gore to reconsider them.

The other break derived, ironically, from the roaring Clinton-Gore economy, which enabled Bush to assert that the 10-year non-Social Security budget surplus would be $1.8 trillion, double previous estimates -- and big enough to contain his $1.3 trillion tax cut plus $500 billion in new spending initiatives.

Gore, though, refused to concede on either point. He insisted that when workers invest part of their Social Security taxes in the stock market, the revenue lost will have to be made up by lowering Social Security benefits, raising other taxes or tapping the non-Social Security surplus.

The $850 billion figure he cited is one estimate of the cost of allowing workers to invest 16 percent of their Social Security taxes in private markets. That's the portion contained in many privatization proposals, although Bush is not expected to endorse any specific plan.

On top of this revenue loss, Gore's campaign insists -- on the basis of a study by the union-backed group Citizens for Tax Justice -- that Bush's tax cut would cost $2.2 trillion over 10 years, not $1.3 trillion, as Bush calculates.

As an alternative, Gore is proposing a much smaller tax cut -- $250 billion -- and is promising to reserve about $750 billion to extend the solvency of Social Security and gradually pay down the national debt of $4 trillion.

Gore, in a way, is the traditionalist -- even conservative -- in this race, promising old-style fiscal responsibility, paying down debt and no reform of the Social Security system.

He's a traditional liberal, though, in proposing nearly $1 trillion in new spending, including $430 billion over 10 years for a Medicare prescription drug benefit, $150 billion for health insurance for the poor and $115 billion for education programs. Bush's new spending is much lower.

Polls show that most voters prefer a debt pay-down and investments in health and education rather than a tax cut -- an advantage for Gore.

Bush, on the other hand, is a reformer on Social Security and, at bottom, a Ronald Reagan-style supply-sider on taxes, promising to lower marginal rates to spur enterprise. Bush plans to cut some domestic spending but hasn't yet revealed how much.

Bush's economic aides claim the difference between Bush and Gore is that the vice president wants to pay down the $4 trillion "debt held by the public," whereas Bush proposes to reduce the $7-trillion long-term unfunded liability of Social Security through private investments.

Polls indicate that about 60 percent of the public believe Social Security needs "major changes," and between 55 percent and 75 percent support some private investment. That's an advantage for Bush.

Bush will argue in a speech this week that investors in the stock market have earned an average 8-percent return on their money since before the Great Depression, whereas Social Security revenues return 1.1-percent interest.

Still, with the Dow and Nasdaq down by nearly 10 percent this year, it will be easy for Gore to say that what Bush proposes is "risky." To win this election, Bush needs to push American voters up the economic education curve.

JWR contributor Morton Kondracke is executive editor of Roll Call, the newspaper of Capitol Hill. Send your comments to him by clicking here.


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04/28/00: Reno's force aids Clinton, not Elian
04/25/00: Should Clinton be indicted?
04/24/00: Can Gore win on Bush tax cuts?
04/18/00: Levin's 'bridge' key to China trade?
04/11/00: Congress, U.S. Voters Still Aren't Ready For Campaign Reform
04/06/00: Bush, Gore Silent As Popular Culture Gets Ever Coarser
03/30/00: Is 2000 Like 1948, 1976 or 1960? Or Is This Unparalleled?
03/28/00: Will Bush, Gore Go for a Better Way To Pick Nominees?
03/23/00: Medicare cutbacks bleed hospitals
03/20/00: Chances Improve That China Trade Will Pass Congress
03/16/00: Lieberman as veep would help Gore
03/14/00: Can Bush, McCain Unite to Beat Gore?
03/09/00: Can GOP Forge Unity After Nasty McCain-Bush Race?
03/07/00: What accounts for McCain's excesses?
03/02/00: 'Debate' Proved Gore Is This Year's Best Gut-Fighter
02/29/00: Surprises! The 2000 GOP race is full of it
02/25/00: Voters want centrist in White House
02/23/00: Gore would hit McCain's record
02/15/00: Will negativity hurt McCain in S.C.?
02/10/00: How hard should Bush hit McCain?
02/08/00: Bush must retool his entire campaign
01/27/00: Could Gore beat Bush as Truman beat Dewey?
01/20/00: Big New Surplus Estimates Could Alter 2000 Politics
12/21/99: Bush improves, everyone panders
12/16/99: Prospects improve for campaign reform
12/14/99: Riots raise free trade as 2000 issue
12/10/99: Gore won GOP 'debate' in N.H.
12/07/99: Election pits Bush cuts vs. Medicare boost
12/03/99: Can race be a constructive issue in 2000?
11/19/99: White House race may be best in decades
11/16/99: Where is Bush on health care fight?
11/11/99: Will TV stop profiteering from politics?
11/09/99: Is GOP isolationist, or just partisan?
11/04/99: Gore, Bradley Run Opposite Races On Style, Substance
11/01/99: GOP, Clinton could reach deal swiftly
10/27/99: Bush to fight 'culture wars' -- positively
10/21/99: Porter, Mack: heroes on medical research
10/19/99: Gore scores among party big shots, but polls go South
10/14/99: Bush critiques could help GOP Congress
10/12/99: Congress can save health care from ruin
10/07/99: Will gun-control cause the GOP to shoot itself in the foot?
10/05/99: Gore moves: Desperate but necessary
10/01/99: Fox, Armstrong make case for NIH
09/28/99: Dems' race brightens Bush's chances
09/23/99: East Timor deflates `Clinton Doctrine'
09/21/99: Buchanan v. Bush? Yeah right
09/17/99: Candidates turn attention to poverty
09/15/99: Bush's education problem
09/09/99: Budget makes 2000 an `issues' election
09/07/99:Airport rage increases, with good reason
09/02/99: U.S. future up for grabs in 2000
08/31/99: U.S. Capitol needs visitor's center -- soon
08/24/99: Will 2000 be the year of the foreign crisis?
08/19/99: Neither party has upper hand for '99
08/17/99: Ford gets freedom medal one month early
08/12/99: There's time to catch Bush, say Gore aides
08/10/99: Rudy, Hillary try much-needed makeovers
08/09/99: GOP must launch new probe of Chinagate
08/02/99: Pols blow fiscal smoke on budget surplus
08/02/99: One campaign reform should pass: disclosure
07/27/99: Gore leads Bush in policy proposals

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