For Immediate Release
Office of the Press Secretary
May 4, 2005
President Discusses Social Security at Latino Coalition Conference
J.W. Marriott Hotel
Washington, D.C.
In Focus: Social Security
10:31 A.M. EDT
THE PRESIDENT: Thank you all. Thanks for coming. Please be
seated. Siéntese. Thank you, Hector. Thank you for the job you're
doing with the Small Business Administration. Thank you all for coming
today to hear this conversation about how to make sure a very important
part of our society functions well for a young generation of Latinos
and people from all walks of life.
So today we're here to discuss Social Security and the importance
of Social Security. And I want to thank our panelists for joining us.
I want to thank the Latino Coalition for hosting this reception. As I
look out in the crowd I see a lot of familiar faces and a lot of
friends. It's great to see you all again. Thank you for coming.
I want to thank Roberto Deposada, the chairman and president of
Latino Coalition. Thank you for hosting this event. I am honored to
be joined today by -- or we are honored to be joined by the Chairman of
the Ways and Means Committee from Bakersfield, California. It's
relevant he is here -- after all, it's his committee that is going to
write the reforms necessary to make sure the Social Security system
works for a younger generation of Americans. I have worked closely
with Chairman Thomas on a lot of crucial issues. When he says he can
get the job done, he means he can get the job done and has proven over
the past five years that he can get the job done. Mr. Chairman, thank
you for joining us. (Applause.)
As well, Congressman Chris Cannon, from Utah, is with us. Thank
you for coming, Congressman; honored you're here.
Before I talk about Social Security, though, I want to remind you
the war on terror goes on. And today's report on the capture of a top
al Qaeda operative, Abu Faraj Al-Libbi, represents a critical victory
in the war on terror. (Applause.)
Al-Libbi was a top general for bin Laden. He was a major
facilitator and a chief planner for the al Qaeda network. His arrest
removes a dangerous enemy who was a direct threat to America and for
those who love freedom.
I applaud the Pakistani government for their strong cooperation in
the war on terror. I applaud the Pakistani government and President
Musharraf for acting on solid intelligence to bring this man to
justice. The fight continues. We'll stay on the offensive until al
Qaeda is defeated. (Applause.)
Franklin Roosevelt did a wise thing when he set up the Social
Security system. A lot of people throughout the last decades have
counted on a Social Security check to help them in retirement. As a
matter of fact, I'm sure you know people in your communities that rely
upon their Social Security check completely to make sure they have
dignity in their retirement. It was a wise idea to set up the system,
and I am mindful that when anybody in Washington talks about Social
Security, a wave of fear ripples through the senior community because
they think somebody is about to take their check away.
So I want to open my comments to you all to assure you that your
loved ones who count on Social Security will get their check. Nothing
will change for today's seniors who are getting a Social Security
check. If you -- as a matter of fact, if you were born prior to 1950,
nothing will change. The system is solvent enough to keep its
promises. And that's very important for people to hear. So when you
hear all these ads and propaganda saying, well, you know, talk about
making sure the Social Security system is modern and seniors are not
going to get your check, just know it's not true and please assure
seniors it's not true, because it's not.
The safety net will work for them, but there is a hole in the
safety net for a younger generation of Americans coming up. And here's
why -- first, let me just describe the nature of the system, and that
is it's a pay-as-you-go system. You pay in payroll taxes and the
government takes care of retirees, and with money left over, spends it
on other programs. And all that is left is a file cabinet with IOUs.
See, some in our country believe that the system works this way: you
pay in the system, we hold your money for you, and when you retire, we
give it back to you. That's not the way it works. It's a
pay-as-you-go system.
Now, the reason there's a hole in the safety net for people who are
going to be paying into the pay-as-you-go system is because there are a
lot of people getting ready to retire. We are called "baby boomers."
I happen to be one. I'm retiring in four years. At least I'm eligible
for my retirement. (Laughter.) I turn 62 in four years. There are
about 75 million baby boomers who will be retired when it's all said
and done. There are 40 million baby boomers -- I mean, retirees
today. So think about that. We have 40 million retirees today, and in
relatively quick order, there's going to be over 70 million retirees.
We've got a lot more people that younger workers are going to have to
pay for.
Secondly, we are living longer. I plan to live a long time.
(Laughter.) It's why I'm exercising a lot. (Laughter.) It's why I'm
making right choices about what I put in my body, and I suggest all
Americans exercise more and be wise about what you eat and what you
drink. It'll help you live longer, they tell me.
But a lot of us are going to live longer. And we've been promised
greater benefits than the previous generation. So if you're a younger
worker out there, you're now looking at more people retiring, who will
be living longer -- in other words, you have to keep paying more
monthly benefits over time, who've been promised greater monthly
benefits. And there's going to be fewer of you paying into the
system. In 1950, there were 16 workers for every beneficiary. Today,
there is 3.3 workers for every beneficiary. In short order there will
be two workers for every beneficiary. So young workers are going to be
paying for more people, living longer, getting greater benefits. And
the pay-as-you-go system goes negative in 2017. In other words,
there's more money going out than coming in. And in -- and every year
it gets worse. That's just the way it's going to work.
And so in 2027, you're going to be $200 billion in the hole, for
example, it will be $300 billion in the 2030s, and the system is going
to be broke in 2041. So you've got people who are starting to pay into
the system now, who are paying into a system that's not going to be
around. And I don't want to make younger workers a lot of -- nervous
in America. The people who ought not to be nervous are the older
Americans. You're going to get your check. It's the people paying for
baby boomers like me who are going to retire who ought to be paying
attention to this issue, because the system is insolvent.
So I have an obligation to encourage Congress to act. And Chairman
Thomas knows what I'm about to say: the longer we wait, the more
expensive it's going to be. If Congress chooses to do nothing on this
problem, you're either going to have to raise your payroll tax to, some
estimate, 18 percent, or cut benefits dramatically by 30 percent. So
now is the time to get after it, in my judgment.
Obviously felt that way because in the State of the Union I spent a
lot of time talking about it, and subsequently have spent a lot of time
talking about it. I'm going to continue traveling our country making
it clear to people we've got a problem, because, see, once they figure
out we've got a problem, the next course of action is going to be to
say to Congress, how come you're not doing anything about it? How come
you're allowing partisan politics to prevent good people from coming
together to solve the problem?
I have an obligation to put some things on the table, and I've been
doing that. First, I believe that future generations must receive
benefits equal to or greater than the benefits of today's seniors.
Secondly, I believe this country needs to set a goal that says if
you've worked all your life and if you paid into the retirement system
to Social Security, you should not retire in poverty. To me, that's a
noble goal. Frankly, it's the kind of goal that Franklin Delano
Roosevelt would strongly support.
And so in my press conference the other night, I proposed a way of
calculating future benefits for future retirees that says, if you're a
low-income worker, your benefits ought to raise -- rise with wage
increases, and if you're an upper-income worker, your benefits ought to
rise with inflation. Seems fair to me. Seems like a noble calling for
the United States of America, to recognize a lot of people work really
hard and don't make a lot of money, but when it comes time to retire,
there ought to be dignity in retirement. I also believe that younger
workers -- and by the way, what -- that plan alone, that part of a
plan, solves the majority of the solvency issue for a generation of
Americans coming up.
In other words, what I'm talking about, making sure that we
permanently solve the Social Security problem can be done. And I have
an obligation to advance the process by putting out some ideas that I
think are important. And I want to thank Chairman Thomas for his
willingness to work with us on this issue, and I'll work with him on
this issue.
Now I want to talk about something else that I think the country
ought to consider, and this pertains to younger workers. I think
younger workers -- first of all, younger workers have been promised
benefits the government -- promises that have been promised, benefits
that we can't keep. That's just the way it is. And I believe I have
the duty as the President to be willing to confront that fact, to tell
people the truth. The younger people in America got to understand
that. We've given you promises we just can't keep.
But one way to make a permanent solution to Social Security system
a better deal is to allow younger workers to take some of your own
money and set it aside in a personal savings account that you can call
your own. And the reason why that's important is because if you watch
your money grow at a reasonable rate of interest, you know it compounds
over time. There's a compound rate of interest, which means money
grows and grows, bigger and bigger and bigger. For example, if you're
making a $35,000 all your life, and you're allowed to take a third of
your payroll taxes and set it aside in a conservative mix of bonds and
stocks that have a reasonable rate of return, then when you get ready
to retire, you'll have $250,000 as part of a retirement plan. You'll
get your Social Security check, whatever the government can afford,
plus money off of your nest egg.
Money grows. And the current system doesn't encourage, doesn't
take advantage of compound interest. And so step one is, letting a
younger person own their own -- manage their own money in a
conservative mix of bonds and stocks will mean you get a better deal on
your own money. This payroll tax is your money. And the government
ought to say you get a better deal on your money, and you can watch it
grow.
Secondly, I like people owning something. The more people own
assets, the better off America is. I reject this notion that the
investor class is limited to only a certain kind of person. The more
moms and dads accumulate assets, the better off it is for American
families. I want more people being able to say, this is mine, the
government can't take it away, the government can't spend it, it's not
a part of a pay-as-you-go system. And when you pass away, you can
leave it to whomever you choose. That's a part of America. And more
people that have that -- (applause.)
This idea, I think, is fair. It means you get a better deal on
your own money. It's fair; it encourages ownership. Listen, the
system today is a lousy deal for widows. The way it works today is if
you and your spouse are working and one of you dies early, then the
spouse upon retiring gets to choose the survivor benefits that your
spouse has paid into the system, or you own benefits, which is ever
higher, but not both. So think about that. Somebody may have died at
age 52, started working at age 22, worked 30 years and put all that
money in the system, and his or her spouse ends up having to choose, to
decide what retirement account he or she wants -- the one she
contributed to or the one he contributed to, but not both. In other
words, the money goes away.
In a personal savings account, as you watch your money grow, a
worker sets aside money in an asset base. That asset can go to help
the widow or the surviving spouse. The system isn't fair today. And
we need to make it fair. And we can make it more fair for people at
the lower end of the income scale.
Now, I want to -- and during this conversation some things will
come out that I think probably -- hopefully some questions will come
out that are on your mind.
I want to address a couple of things. One, I understand there is a
need for more financial literacy in America, and so I've instructed the
FDIC and the SBA and the Treasury Department to work with the Latino
Coalition and the Hispanic Chamber and other groups to help make sure
that financial literacy is more widespread in all neighborhoods and all
communities. (Applause.) FDIC has got the money smart financial
workshop program. They're going to work with the Latino Coalition.
SBA has got a negocios.gov program on the web page. Treasury has got
all kinds of financial learning materials that we can spread out, and
we need your help.
Secondly, what I'm talking about, though, is happening in America
already. In other words, I'm not inventing something new to say to
somebody, you can invest your own money. When I was coming up, there
wasn't a lot of talk about 401(k)s or IRAs. There wasn't any. And
today -- yesterday I had an interesting experience. I went down to the
Nissan plant in Canton, Mississippi, and it was a very diverse
audience, a lot of assembly-line workers. And I said, how many of you
all have got your own 401(k)? I mean, the number of hands that went up
was astounding. You've got people from all walks of life managing
their money already. People are getting used to it.
Matter of fact, this was such a good idea that the United States
Congress a while ago decided in the Thrift Savings Plan, the Federal
Thrift Savings Plan, to allow federal workers -- members of the United
States Congress and members of the United States Senate -- to manage
their own personal account. See, and the reason why is, I'm confident
they took a look at the rate of return a government can get versus the
rate of return that you can get in a conservative mix of bonds and
stocks, and decided they want their money to grow -- they want to watch
their money grow faster, than that available to the government, and so
they said, they just decided we'll get to do this, too.
If it is good enough for a member of the United States Congress to
set aside some of his or her own money in a personal savings account so
they get a better rate of return, they can pass it on to whomever they
want, it ought to be good enough for workers all across the United
States of America. (Applause.)
I am honored to be joined by Fidel Vargas today. Fidel is an
interesting man. He's already been a -- he's 36 and he's already been
a mayor of a California city. Did a fine job there.
You know, when I first got elected, I recognized that the Social
Security issue is going to be an issue that was going to require some
-- some sound thought and reasoning. People needed to be coming
together to help think about this issue. And so I set up a
commission. Daniel Patrick Moynihan, the former Senator from New York,
Democrat Senator, was the chairman of it, and I asked Fidel to join.
And welcome, Fidel. Thanks for coming. He is a -- well, you'll
see. He knows what he's talking about.
* * * * *
MR. VARGAS: And I'm a little embarrassed to say, but I think I'll
share with the President that the first time he ran, I didn't vote for
the President. So excuse me for that, sir. But I'm sure --
(laughter.)
THE PRESIDENT: I understand a lot of other people didn't, either.
(Laughter and applause.)
* * * * *
THE PRESIDENT: Great job, thanks for coming. (Applause.) The
fact that you went to Harvard bothers me more than the fact that you
didn't vote for me. (Laughter.)
MR. VARGAS: We both went to HBS.
THE PRESIDENT: That's right. I forgot that part. (Laughter.)
Good job. Thanks for coming.
The message here is really important, that it doesn't matter
whether you're a Republican or a Democrat on this issue, what matters
is, do you care about the future of the country, and are you willing to
set aside partisanship and work in a constructive way to get something
done?
If you're a senior, you're going to get your check. You know
what's happening now? A lot of grandmothers and grandfathers, when
they finally absorb that message, are beginning to say, what about my
grandkids; Mr. President, it seems like a big problem coming for them,
what are you going to do about? And now is the time to do something
about.
Fidel, I appreciate your tone, I appreciate your constructive work
on this issue. Thanks for coming.
Our next guest is Russell Ybarra. He's United Nations Tejano.
MR. YBARRA: A true Tejano.
THE PRESIDENT: A true Tejano. Those are the best kind. (Laughter
and applause.)
A businessman -- tell everybody what you do, Russell.
MR. YBARRA: Well, first of all, yes, I was born and raised in the
Lone Star state, so we're neighbors.
THE PRESIDENT: Very good.
MR. YBARRA: Again, my name is Russell Ybarra, and I tell people
the first three words I learned in Spanish was lechuga, tomate you
cebolla, because that was the order we put them on the tacos at my
family's restaurant when I was growing up. (Laughter.) So, anyway,
I'm the President and CEO of Gringo's Mexican Kitchen. We operate six
stores in the Houston area and one in San Antonio.
THE PRESIDENT: Good. How are you doing? Making a little --
MR. YBARRA: We're paying our taxes -- on time. (Laughter.)
THE PRESIDENT: How about your ownership? You paying any of that?
MR. YBARRA: A little bit.
THE PRESIDENT: A little bit, that's good. Well, in other words,
you're in business.
MR. YBARRA: Exactly.
THE PRESIDENT: That's good.
MR. YBARRA: We have a duty.
* * * * *
MR. YBARRA: Again, the 401(k) program in the food service industry
is an exception, not the rule. And I thought, okay, we have a 401(k)
program implemented, in place, and so we should just have everybody
lining up to join the plan. Well, it didn't work out that way. We
have very low participation -- and for good reason: many of those that
work for us are what you would consider low-wage earners.
THE PRESIDENT: Can't afford the contribution.
MR. YBARRA: Right. Exactly.
THE PRESIDENT: -- payroll tax.
MR. YBARRA: Well, and that's just it. They're already paying 12.4
percent, basically, and have little or no disposable income to set
aside for future retirement. So this really impacts them
dramatically.
* * * * *
THE PRESIDENT: The best thing is to let them take their payroll
taxes they're paying the system and have a plan that allows their money
to grow just like a 401(k) can. That's the best thing to do for
low-income workers. That's why the Social Security reform is a vital
reform for people at the lower end of the wage scale. It's really
important.
Anyway, go ahead. Sorry to interrupt.
* * * * *
THE PRESIDENT: Right. Remember, and this is important for people
to hear, this is not the government saying, you have to do this. This
is government saying, if you so choose to set aside some of your own
money, you ought to be allowed to do so. It's optional. It basically
says that government is not going to dictate, government just says,
here's an option to trust people with their own money.
And a couple of points I want to make on Russell. One, the
entrepreneurial spirit is strong in America; we need to keep it that
way. Congratulations on starting your own business.
MR. YBARRA: Thank you.
THE PRESIDENT: This is a chance -- you volunteered to come up
here, so anybody listening on C-SPAN in the Houston area, looking for a
good restaurant, Russell -- (laughter and applause.)
MR. YBARRA: I'm currently, also, the Greater Houston Restaurant
Association President.
THE PRESIDENT: Oh, good, yes.
MR. YBARRA: And I don't know if you know this or not, but the
National Restaurant Association endorses your plan.
THE PRESIDENT: Well, thanks. I appreciate it.
If you're making $8 an hour over your life, and you start having a
personal account when you're 21 years old, and at the age 63 you'll end
up with a $100,000 nest egg. That's if you stay at $8 all your life.
In other words, that's how money grows. Wouldn't it be fantastic if a
lot of folks who work for Russell's company were able to say, here's my
money, here's the nest egg I built up for my family.
The more ownership there is, the more assets passed on to a
community, the better off the community is going to be. And the idea
of owning something ought to be spread throughout all America. That's
the great promise of America. That's what we're all about. You come
here, you work hard, you realize your dreams, and you have a chance to
build something for your family.
How many people -- you said your dad and mom came. I suspect
there's a lot of first-generation of Americans here because their
parents came over here because of dreams and hopes.
By the way, speaking about restaurant employees, we've got to have
a rational policy when it comes to immigrants coming to this country.
I believe if there's -- somebody is willing to employ somebody and they
can't find an American worker, and somebody is willing to do the job,
we ought to make that connection a legal connection. People come here
to work. (Applause.)
And this, by the way, will make our borders more secure. As
opposed to people having to get in the back of 18-wheelers and sneaking
across, you know, Texas borders, or trying to walk across the desert to
find work, if you've got a pass that says, I'm a willing worker willing
to work for a willing employer, it means they can just walk across
normally and not have to try to sneak across. We'll be able to defeat
a whole industry of document forgers and smugglers and coyotes, and it
means we'll be able to uphold the dignity of persons around the world.
(Applause.)
Anyway, it's called diverting off the topic. Por nada.
MR. YBARRA: One last point, Mr. President, and I think this is a
profound one. The underlying benefit of what you're proposing is a lot
like what we did with our core beliefs, reinvesting in our associates
and local community. I feel by doing this, the American productivity
will increase dramatically.
THE PRESIDENT: That's right. Well, basically, what he's just said
is, if you own something, you have a vital stake in the future. I
mean, think about how great it's going to be when Jos and Jessica, as
they have an investment account -- they're young, new married -- we're
about to talk to them here -- but on a monthly basis, a quarterly
basis, daily basis in some cases, you watch your assets grow. You open
up a statement and say, here is what I own. That encourages people.
If they're seeing something they own grow, that the government can't
take away from them, it encourages. And it will enhance productivity,
and it will enhance the spirit in a lot of communities.
Good job. Thank you, Russell.
MR. YBARRA: Thank you.
THE PRESIDENT: It's great to see you. (Applause.)
Jos . Jos and Jessica, welcome. Thank you all. Newlyweds?
MS. GOMEZ: No, five years.
THE PRESIDENT: See, not newlyweds. (Laughter.) I'm glad you're
here. Give us a sense of who you are, what you're doing.
MR. GOMEZ: It's an honor to be here with you. My name is Jos
Gomez. This is my lovely wife, Jessica. We've been married for almost
five years. We have three beautiful kids. I currently attend DeVry
University. I'm a full-time student.
THE PRESIDENT: Yes? What are you studying?
MR. GOMEZ: I'm studying network system administrator.
THE PRESIDENT: Network systems administrator. Would you like to
try to describe what that means to the technologically illiterate?
(Laughter.)
MR. GOMEZ: Basically, I will be taking care of a network in a
business, or something. But I, personally, want to own my own
business.
THE PRESIDENT: Want to own your own business? That's great.
MR. GOMEZ: Yes, I want to start my own business later on, in the
future.
THE PRESIDENT: Do you have any idea what it's going to be yet, or
are you just getting the skills necessary --
MR. GOMEZ: Still getting the skills --
THE PRESIDENT: -- and the confidence necessary to launch?
MR. GOMEZ: That's correct, that's what I'm currently --
THE PRESIDENT: That's wonderful, though, isn't it? A guy sits up
here with the President: I want to own my own business. (Laughter and
applause.) You may take a few tips from Russell.
MR. GOMEZ: Currently I work in a job part-time, and they don't
offer the 401(k). And I work basically on a check-to-check basis.
THE PRESIDENT: Yes.
MR. GOMEZ: What I like about your plan is, it will give me the
opportunity to start saving and looking for the future, for our
retirement, and if we choose to, pass it on to our kids for a nest
egg.
THE PRESIDENT: That's an interesting thought. You've got three
little kids. Jessica, you want --
MS. GOMEZ: I have three beautiful children: Joslynn, who is four;
Jovanni, who is two; and Isabella who is one.
THE PRESIDENT: Good, I'm looking forward to meeting them
afterwards.
MS. GOMEZ: They're looking forward to it, too. I worry more about
their future, as any other mother does. I worry about that if the
system continues the way it is, as you said before, by the time they
work, they're going to be working twice as hard to take care of us when
we retire.
THE PRESIDENT: That's right.
MS. GOMEZ: So that when they -- it's time for them to retire,
they're going to be just be so worn out, they're not going to --
they're going to be broke, both emotionally and financially.
THE PRESIDENT: Interesting thought, isn't it? Mom is sitting
here, saying, I've watched -- listened to the data. So the system
starts to go broke 2017; 2041, as Fidel said, there's nothing left.
And she's got little kids. She's going to be paying into that system,
and so are they. It's a troublesome thought for moms and dads to think
about the system as it is, and it's got to be just as troublesome to
think that the government is not -- hasn't done anything about it. Now
is the time to do something about it.
You know, a lot -- I talk to a lot of young folks, like Jos and
Jessica. There was an interesting survey once that somebody pointed
out to me, that said younger people think it's more likely they're
going to see a UFO than get a Social Security check. (Laughter.)
Well, if you feel that way, and you watch that money come out of
your check every month, it's a little discouraging, isn't it? To be
paying into something that you're not sure is going to be around. Yes,
so this is a young person issue. Older people, the grandmas and
granddads, they don't have a thing to worry about. We're going to keep
the promise. But it's the youngsters who are working hard, and the
moms and dads who are working hard, and the moms and dads who are
worried about their children when they're coming up, that's what this
issue is about, folks.
And it is amazing to me that we're living in a town where people
oftentimes say, well, we can't cooperate with each other because of
party politics. You heard a good Democrat sit up here and say he
believes a reformed system will help his children and his community.
That's the spirit that's needed. And we here in Washington, we need to
think about people like Jessica and Jos , young kids, working hard,
wants to start his business, got young kids, mom sitting up here
saying, I'm worried about it. She's really saying this: You people in
government, how come you can't do nothing about it -- or anything about
it? (Laughter and applause.)
I've learned to correct myself early before it gets on the record.
(Laughter.) Fortunately, the First Lady is not here. (Laughter.)
She'd probably have some joke about it. (Laughter.)
Anyway, thank you all for coming. Is there anything else you want
to add? Well, I appreciate you letting us use you as an example,
looking forward to meeting the kids.
MS. GOMEZ: Thank you for letting us be here.
MR. GOMEZ: Thanks for letting us come on.
THE PRESIDENT: Well, thanks for coming. Our final guest is
Elizabeth Fernandez. Elizabeth, welcome. Tell us what you do.
* * * * *
THE PRESIDENT: Yes, that's an important concept -- sorry to
interrupt, but you're right. To run up the payroll tax rate is going
to hurt a lot of small businesses. One of the things we're always be
mindful of in Washington is how do you make sure the entrepreneurial
spirit is strong. And one way to make sure it's not strong is to
overtax the small businesses. And so I appreciate you bringing the
payroll taxes in, it's a significant burden on many small businesses.
And it's really -- really an important point. Thank you.
* * * * *
MS. FERNANDEZ: I don't know -- do you have a financial literacy
program, an education program set up to help --
THE PRESIDENT: Yes, we do. That's the -- FDIC, Treasury
Department, SBA are very much involved with making sure people feel
comfortable -- I appreciate you bringing that up again, Elizabeth --
people feel comfortable about what it means to invest. I recognize,
some people get nervous about it. You heard a Harvard man said he got
-- if he'd gone to Yale, he wouldn't have been so nervous.
(Laughter.) But he said -- no, but it's a new thing -- you know, some
worry about it, but people need to be assured that there are thousands
of their fellow citizens who are comfortable now investing their own
money. They hadn't been doing it in the past.
In other words, there's a new culture in America today. A lot of
older Americans are saying, well, this is too difficult for some,
perhaps. But there's a lot of younger Americans who are getting
comfortable with managing their money through a series of programs,
such as 401(k)s or IRAs, to find contribution plans.
And so -- but you're right. We need to make sure people become
more financially literate. And by the way, in terms of what you can
invest in, you cannot take your money to the lottery. In other words,
there's a conservative mix of bonds and stocks. And there are people
to explain what it means. And you get to decide. If you're a younger
worker, you may decide to have a more -- a greater mix of stocks and
bonds. As you get older, you may decide to diversify. But you're
constantly making decisions for your own money.
The government doesn't make those decisions for you. The
government makes options available for you. And then when it comes
time to retire, you can go into a Treasury bond account -- a perfectly
safe investment, all of which, by the way, all those investment
vehicles yield a better rate of return than you're getting on the
government's money.
I remember campaigning with John McCain on this issue, and he said
that his thrift savings account -- I think he said something like 7
percent rate of return on the money, as money grew over time. And
that's compared to 1.8 percent in the current Social Security system.
And that 5.2 percent difference in interest makes a huge amount of
money, makes a huge difference for you in the amount of money available
over time.
So thanks for bringing it up. Elizabeth, anything else on your
mind? You're awfully articulate. (Laughter.)
MS. HERNANDEZ: No, I just -- thank you for the opportunity to be
able to share concerns, and thank you for your efforts in this area.
THE PRESIDENT: Well, one of the things that Elizabeth said that
triggered a thought here is she said this is a complex issue, there's a
lot of misinformation. And I understand that. There's a lot of moving
parts, as they say -- which says to me, I better keep working on it.
And I'm going to. I'm just getting started. (Applause.) This is an
issue that -- I'm going to spend a lot of time talking about this
issue. I will spend as much time as necessary.
Congress has an obligation to act. I appreciate you saying I
brought up an issue that I didn't need to bring up. I needed to bring
it up, that's my job. The President's job is to -- when he sees a
problem, is to say, let's deal with it, not to shirk the duty, not to
pass it on.
Fidel mentioned President Clinton -- he started the process. I
remember watching the town hall meeting you all had in Albuquerque in
1996, I think it was, and it was a fascinating discussion. Michael
Boskin, who I think was on the commission then -- I remember Mike, my
buddy, talking about it. And I can't remember if you presented there,
or not.
MR. VARGAS: I was there.
THE PRESIDENT: Did you present?
MR. VARGAS: No.
THE PRESIDENT: Whew! (Laughter.) I thought I might have dissed
you there for a minute. (Laughter.) But my only point is, is that
that's what the President does. The President confronts problems. And
now is the time to take this problem on.
Mr. Chairman, I thank you for being here. Chairman Thomas would
not be here if he didn't realize this was a very vital issue to people
from all walks of life. And he wouldn't be here if he didn't believe
that it was important to work together in a collaborative spirit to get
something done. And so thank you for letting us advance the issue. I
appreciate you providing the forum. I'm honored our panelists came
here. Thank you all for being here again.
May God bless you all, and may God continue to bless our country.
(Applause.)
END 11:22 A.M. EDT
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