Bush's backslide

By Tim Grieve
Published February 17, 2005 1:53PM (EST)

We thought we saw a sign of some White House backsliding on Social Security Wednesday, and now there's more evidence of retreat.

In his State of the Union address two weeks ago, George Bush said he was open to all options for fixing Social Security -- then immediately took one off the table. "We must not jeopardize our economic strength by increasing payroll taxes," the president said.

But with his privatization plan on the ropes -- the <a target= "new" href="New York Times says today that Bush faces "an almost solid wall of Democratic opposition" and a lot of doubts from Republicans in the Senate -- Bush now seems to be saying that he'd be open to a tax hike after all.

At a press conference for regional newspaper reporters, Bush was asked directly Tuesday whether he'd consider raising the cap on the amount of wages that are subject to the Social Security payroll tax. According to an account in the New Haven Register, Bush responded: "The one thing Im not open-minded about is raising the payroll tax rate. And all the other issues go on the table."

Under the current system, workers pay the Social Security payroll tax on the first $90,000 they make each year. After that, they're done. It's a nice mid-year boon to high wage earners, who see their paychecks increase by 6.2 percent on the day each year that their year-to-date earnings top $90,000. But raising the cap would put more dollars into the Social Security system, addressing the "problem" the president says exists in a way that he admits his privatization plan won't.

The White House was cagey about Bush's comments when the national press got hold of them Wednesday, and you can be sure that Bush won't ever concede that raising the cap on the payroll tax is, in fact, a tax increase. Indeed, even as the president signaled openness on the payroll tax Tuesday, he displayed the White House's proclivity for fiscal obfuscation on the related front of Social Security benefit cuts. Asked if benefits will have to be cut to pay for his privatization plan, the president said: "'Benefit cuts' is an interesting word. Benefits are scheduled to grow at a certain rate, and one of the, one of the suggestions, for example ... was they grow at a, they grow, but not at a rate as fast as projected. You can call it anything you want. I would call it an 'adjustment to reality.'"

The president seems to be undergoing one of those himself.

Tim Grieve

Tim Grieve is a senior writer and the author of Salon's War Room blog.

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