Pelosi blasts Republican plan to privatize Social Security

“Just five years ago,
President Bush and his Republican allies pushed a risky plan to privatize and
cut Social Security,” she said. “If they had succeeded, seniors would have lost
trillions more in the financial crisis. At the time, Democrats and the American
people said ‘no.’ And no one lost a penny in Social Security, even as America’s
households lost more than $17 trillion in wealth.”

Under Bush, congressional Republicans
sought to allow individuals to invest a percentage of their social security
benefits in investment instruments. They claimed the rate of return for these
vehicles would be greater than keeping benefits in the trust fund. They also
said that the benefits would be transferable, meaning the funds could be
transferred to other family members. 

Republicans never got enough
momentum behind their initiative to pass it out of Congress. 

A similar proposal has been
advanced by Rep. Paul Ryan (R-Wis.), ranking member of the House Budget
Committee. It allows workers to invest their Social Security benefits in
personal saving accounts, which would provide a higher yield than the trust
fund but also contain greater risk.

“This year, Republicans are
charting a course right back to the failed ideas of the past,” Pelosi said. “Again,
Democrats and the American people are saying ‘no.’ We are not going back to the
exact same agenda of the Bush years.”

Rep. Earl Pomeroy (D-N.D.), who chairs the Ways and Means Subcommittee
on Social Security, plans to host a hearing on Ryan’s proposal in the fall. The
focus of the hearing will likely focus on the solvency of the trust fund and
how Ryan’s plan could affect it.