Greenspan's as always cryptic testimony appears not to have been vague enough for the Bush administration to spin.
WASHINGTON (Reuters) - President Bush acknowledged Thursday that after nearly a month of lobbying he had failed to sway Congress on his plan to overhaul Social Security but he vowed to keep up the effort.
"I fully understand this, that this idea is going nowhere if the Congress does not believe there is a problem," said Bush, who bases his call for remaking the 70-year-old Social Security program on his contention it will go broke in its current form.
The president told a news conference that he would be doing a lot of travel in coming weeks to try to make his case.
Democrats and some Republicans believe the financial problems are not as dire as Bush contends and can be fixed by some moderate changes.
At the news conference, Bush also responded to Federal Reserve Chairman Alan Greenspan's concerns about the transition costs for his Social Security proposal by saying he would work with Congress to figure out a solution.
But he gave no specifics on how he would pay for the centerpiece of his Social Security plan -- allowing workers to put up to four percentage points of their payroll taxes into individual accounts that could be invested in stocks and bonds.
What a surprise.
Who will pay?
Trillions of dollars in costs could arise in future decades as payroll taxes are diverted into the accounts, forcing the government to come up with extra money to pay the benefits of current retirees.
This is a concern to several lawmakers, including a number of Republicans, with deficits already at record levels.
Bush's comments came a day after Greenspan endorsed the concept of the individual stock and bond accounts but expressed concern about the transition costs.
The Fed chief said there was a "huge hole" in the Social Security system and "we have no choice but to find a way to fill it."
Bush acknowledged that private accounts alone will not solve Social Security's long-run financial problems.
In a newspaper interview Tuesday, Bush left the door open to raising the $90,000 cap on income that is subject to the payroll tax, which would boost the contributions paid by high-income earners.
He drew a distinction between lifting the cap and raising the 12.4 percent payroll tax rate -- something he vowed to oppose.
But House Speaker Dennis Hastert was skeptical about raising the payroll cap.
"My view of raising the payroll tax is it's raising a tax, something I would not opt to do myself," Hastert said. "My personal feeling is that it's an increase in taxes."
What a bizzare statement. The world the Republicans live in is a strange one, indeed. Who cares if its a tax or not? Is it the right policy at the right time or isn't it?
It a pathetic state of affairs that the Republicans will consider raising taxing only so long as they aren't forced to call it that.
This is such a sad moment in American politics. When you consider the problems facing Americans--health care, a growing fiscal crisis, rampant anti-Americanism, global warming, terrorism, etc.--you wonder at how these people could possibly live with themselves. While the most salient issues of our time spin out of control, the party in power seems determined to ignore them and focus on their ideological agenda no matter how many people suffer as a result.