Dayton v. Kennedy

Returning Senator Mark Dayton to the Ranks of the Idle Rich in 2006

1/17/2005

Dayton, Kennedy and the Third Rail

Kevin Diaz manages a competent piece this morning weaving together two looming battles: Dayton v. Kennedy and Social Security reform.

Kennedy signals some wariness of plans currently under discussion. Rightly so. As DvK has said in the recent past here and here, the White House has so far failed to flesh out a plan that is simultaneously good politics and good policy:

WASHINGTON, D.C. -- Rep. Mark Kennedy can say two things for sure about Social Security: It's got a long-term money problem and it can't be solved on the backs of seniors.

Much beyond that the Minnesota Republican can't say. He's not alone. There is no plan, other than leaked details that are making many Republicans in Washington nervous.

Benefit cuts? "Who's talking about benefit cuts?" Kennedy said. Personal retirement accounts? "What do personal accounts mean?" he said.

Welcome to the "third rail" of American politics.

A week into President Bush's renewed campaign to overhaul Social Security, many Republicans are wary of signing on to any plan that could have political costs in 2006.

"Whatever we do, somebody's ox is going to get gored," said Rep. John Kline, another Minnesota Republican.

Kline, who is frequently aligned with Bush, added: "So we have to be very careful as we go forward, whose ox we're going to gore."

Democrats, sensing blood in the water, are charging that the White House plans to trade lower guaranteed benefits for future retirees for personal savings accounts with possibly higher but uncertain rates of return. They hope that idea will prove politically toxic in the run-up to the midterm congressional elections next year.

With the AARP, the powerful senior lobby, siding with the Democrats in the early rounds, some Republicans are urging the Bush administration to come out quickly with a clear formulation of the problem -- and then a plan that they can defend.

"You have to establish that we're not going to pull the rug out from under grandma," said Rep. Gil Gutknecht, a Republican who supports the idea of personal savings accounts, as long as they're optional.

Rep. Jim Ramstad, one of four Minnesota Republicans facing reelection to Congress next year, believes that the notion of resistance within the GOP has been overblown. But he said he wants to see the numbers before he endorses any plan to create personal savings accounts under Social Security.

"Most Republicans are keeping their powder dry," Ramstad said. "I certainly am keeping my powder dry because I need to hear the projections on the transition costs. They're all over the board."

'Hornet's nest'

Political experts say that kind of caution is well-founded. Social Security is a bedrock American safety net program that dates back seven decades. Although the approaching retirement of members of the baby boom generation is expected to cause the system to start drawing on its reserves in 2018, the government's Social Security Trustees project that the system will be able to maintain full benefits until at least 2042, which is an eternity in politics.

"I will be dead by then," said Rep. Rob Simmons, 61, R-Conn., speaking to the Washington Post this week. Simmons, questioning the urgency of Bush's Social Security agenda, called it a "political hornet's nest."

Fears of voter anger already have some observers comparing Bush's ambitious Social Security plan to President Bill Clinton's doomed health care initiative, which is sometimes credited with costing the Democrats 53 seats in Congress a decade ago.

"More and more the White House is seeing the early semblances of the Clinton health reform effort," said University of Minnesota political scientist Larry Jacobs. "The similarities are striking."

Even more striking, closer to home, are memories of how Sen. Mark Dayton, D-Minn., used the charge of Social Security "privatization" against then-Republican Sen. Rod Grams, a strong advocate of personal retirement accounts. Minnesota voters sent Grams packing in 2000.

"It's not lost on any Republicans what happened to Grams," Jacobs said.

Among the most cautious of the congressional Republicans from Minnesota is Kennedy, who is weighing a run against Dayton next year. Dayton has panned personal retirement accounts, saying they would divert payroll taxes that now go to pay benefits to current retirees, and thus "would only hasten the day when those annual deficits begin."
Although Democrats contend Kennedy has endorsed the idea, Kennedy says he views it only as an option that should be considered to strengthen the system.

Kennedy, like virtually every other Minnesota Republican in Congress, said he is determined not to do anything that will raise payroll taxes or endanger the benefits of those now retired or nearing retirement.

"Part of the solution is higher returns," he said. Asked if that translates into support for personal retirement accounts, he demurred, saying there is no specific plan: "If you don't have a specific proposal into which you can say 'Here's what it means,' I don't know that you can say that you're for it or against it."

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