Thursday, April 28, 2005

What President Bush forgot to mention

From the Star Tribune/Associated Press:
"If you work hard and pay into Social Security your entire life, you will not retire into poverty," President Bush said during his hour long news conference Thursday night.

Bush spoke as White House officials issued written material saying the type of change he had in mind could be accomplished with a "sliding scale benefit formula."

That would mean lower payments for future retirees of middle and upper incomes than they are currently guaranteed -- a fact Bush himself did not mention during the 60-minute session.

"The money from a voluntary personal retirement account would supplement the check one receives from Social Security," Bush said. He added that personal accounts would also leave retirees with nest eggs that can be passed along in the future, but that was another case in which he omitted key details.

Administration officials have told Republicans in Congress that lower-income workers who retire with personal accounts would be required to purchase annuities to guarantee themselves a lifetime benefit. In some cases, the cost of the annuity would deplete their personal accounts, leaving nothing to be inherited.


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