Presidential Conversation on Social Security
Great Falls, Montana
February 3, 2005
Thank you all for coming. (Applause.) Thank you
all for being here. Go ahead and have a seat. Thank you. Nice to be
in the part of the world where the cowboy hats outnumber the ties.
(Applause.) Thanks for coming. Gosh, it's wonderful to be back in
Montana. What a fabulous state, full of really decent, honorable
Conrad, thanks for introducing me. I'm glad you didn't auction me
off. (Laughter.) Doing a fine job in the United States Senate, and
I'm proud to call you friend. Thank you very much, sir. (Applause.)
And I want to thank Max Baucus for being here. We have worked a
lot together in four years. You know, we've confronted a lot of things
in this country -- we've confronted a recession, and confronted the
need to get this economy growing. And Max worked hard with the
administration to cut taxes and open up markets. And I appreciate
working with you, Max. It's been a lot of fun. We got more work to
We're here to talk about an issue after a while that's going to
remind us we got a lot of work to do if we're going to do our duties as
public servants. But, Max, thank you. Denny Rehberg, thank you,
friend, for coming. I'm honored you're here. Proud of the United
States Congressman from the great state of Montana (Applause.) And
The Governor met me at the airport -- the Governor is here.
Governor, thank you for coming. I'm proud you're here. One of these
days you're going to join the same club as me and Judy and Marc Racicot
-- that's the ex-governors club. (Applause.) But right now, you may
have the best job in America, being the governor of a great state.
Proud you're here. Lt. Governor is here with us today. We got a lot
of other officials -- Secretary of State -- thanks for coming.
You know, we're flying over on Air Force One, and guess all --
guess what Burns and Rehberg -- all they wanted to talk about was
cattle. (Laughter and applause.) Montana beef. (Applause.) And
that's an important subject because it's part of how to make sure our
economy continues to grow. They kept asking, are you talking to
markets overseas to get the Montana beef into those markets? I said,
you bet I am. And we'll continue to do so.
One of the reasons I work with Max to -- on free trade is because I
believe when we open up markets for products, U.S. products, Montana
products, people are going to more likely be able to find a job. We
want to be selling stuff you grow here and stuff you produce here all
around the world. And so I want to tell -- tell Max and Denny and
Conrad, we're going still be opening up markets.
They also had a few other things on their mind. They wanted to
talk about energy. Last night, I said to the United States Congress --
I said, we have been debating energy long enough. (Applause.) It is
time -- it is time to get a sound energy plan to my desk so we can
become less dependent on foreign sources of energy. (Applause.)
People in Montana know something about energy. I know that. They
said also make sure you keep in mind the needs of the rural health --
hospitals and docs. You've got some rural -- you've got some rural
issues here in Montana because you've got a lot of land. (Laughter.)
And not a lot of people. (Laughter.) That's the way a lot of folks
probably want to keep it, too, I suspect. (Applause.)
If you want to have health care available and affordable, we've got
to do something about these lawsuits that are running good doctors out
of practice. (Applause.) We've got a problem in that these lawsuits
are making it costly for docs to stay in business, and are hurting the
federal budget, too. When you're afraid of getting sued, you practice
defensive medicine. In other words, you prescribe more than you need
to just in case you have to go to a court of law. And that runs up the
cost of Medicare, Medicaid, veterans benefits.
So I've come to the conclusion that the medical liability issue is
a national problem that requires a national solution. And I call upon
Congress to pass real, meaningful medical liability reform.
Before we -- before we talk about Social Security, I do want to
talk a little bit about the amazing times we're living in. Just think
about what has happened in the last four months. There was an election
in Afghanistan. Millions -- millions of people voted for -- (applause)
-- voted for a leader -- voted for a President for the first time in
5,000 years. I don't know who's counting, but that's a lot, you know.
(Applause.) I mean, it's an amazing story, when you think about it.
It wasn't all that long ago that the Taliban was providing safe haven
to al Qaeda in Afghanistan. And that's where they plotted and
trained. That's why we went in, to rout them out.
We said if you harbor a terrorist, you're equally as guilty as a
terrorist. The doctrine still stands. And the reason the doctrine
still stands is because there's an enemy that still hates what we stand
for. We will stay on the offense. No matter where they hide, where
they run, the United States of America and coalition forces will be
after them to keep us safe. (Applause.)
That is our duty. That's the responsibility of the federal
government. And I want to thank those who wear our uniform for serving
this great country of ours. (Applause.) But the lesson of Afghanistan
-- the lesson of Afghanistan should remind us we've got a greater force
at our disposal than just our military, and that is our belief in the
ability of freedom to change societies.
And we saw it. The high school students and college students here
are watching some amazing history unfold. Think about what you've
seen. You saw people vote in Afghanistan to elect a President. You
saw people vote in the Ukraine to elect a President. You saw people
vote in the Palestinian Territories to elect Abu Abbas. And you saw
last Sunday some incredibly brave people in Iraq defy the terrorists
and cast their ballots by the millions, because of freedom.
Freedom is powerful. Freedom is incredibly powerful. I believe
that freedom is embedded in everybody's soul. That's what I believe.
I believe that given a chance, people will vote. And people will --
people will adhere to the rules of self-government. It's not easy in
parts of the world, though, where there's terrorists and tyrants trying
to stop the march of freedom. And the reason they are, and the reason
they're trying to stop the march of freedom is because they think the
exact opposite. They believe in control of people's lives. They don't
believe in freedom of religion. They don't believe in freedom of
speech. They don't believe in freedom of the press. They don't
believe in freedom, period. And we do. That's why we're still a
target. but that's why we'll prevail in the long run, because deep in
everybody's soul is that deep desire. And you know what I believe it's
deep in everybody's soul? Because I believe it's the Almighty God's
gift to every soul on the face of the Earth. (Applause.)
You about ready, Leo? Let me say one other thing. They asked me
-- you know, I've been asked, and they say, is there a timetable of
withdrawal from Iraq? Here's the answer to that. You don't set
timetables. You don't want the enemy to say, okay, we'll just wait
them out. The timetable is as soon as possible. And it's going to be
based upon the willingness and the capacity of the Iraqi troops to
fight the enemy. And so our mission -- our mission is to provide
training and command structure and officer training to the Iraqis so
they can defend their own freedom. That's what they want to do. I
talk to their leadership all the time. And like any independent free
country, they want to defend themselves. And our job is to help them
defend themselves. And when they do, and when they're ready, our
troops will come home with the honor they have earned. (Applause.)
And as freedom spreads -- as freedom spreads in parts of the world
that have not known freedom, our children and grandchildren are more
likely to grow up in peace. And that's what we want. We want to
spread the peace. (Applause.)
Let me talk about Social Security. You know, people say, gosh,
that's a pretty tough issue to be bringing up. We've got a war to
fight, why are you bringing up Social Security? Here's why: The job
of the President is to confront problems, not to pass them on to future
generations or future Presidents. (Applause.) That's the way Montana
people think. If you see a problem, go fix it. (Applause.) Don't
theorize, don't pontificate, but fix it. And so the question is, do we
have a problem?
First of all, let me explain why I think we -- I know we have a
problem. When Social Security was designed, there were 16 workers for
every beneficiary in 1950 --actually, designed in the '30s -- in 1950,
there were 16 workers for every beneficiary. That meant it was a lot
easier to afford that which the government promised. When you've got
16 people paying in for one person, it -- you can see why the system
What's happened since the design of the system, however, is that
people are living longer -- thankfully. (Laughter.) That's good
news. (Laughter.) What else is happening since the system was
designed is we had what's called the baby boomers -- that would be me,
Baucus, others, you know -- (laughter) -- people whose hair is getting
grayer on a regular basis. And we're fixing to retire in big numbers.
So you're living longer and you've got bigger -- you've got big numbers
retiring, and fewer workers paying into the system -- 3.3 workers per
beneficiary. Plus, Congress, over the years, has promised an increase
of benefits. So think about the math. Fewer people paying into the
system, more people living longer, more people retiring, for greater
Now, that is -- and because Social Security is a pay-as-you-go
system, there's not a great big trust of money. The money that goes in
from your paycheck goes out to the beneficiaries. That's how it
works. And so, obviously, as the demand for money increases as a
result of more people retiring and people living longer and benefits
going up, more has to come in.
Now, if you look at this chart up there, in 2018, the Social
Security system goes negative. That means more money is going out than
is coming into the system. And every year after that, as you can see,
the cash deficit -- that is the money going out is greater than the
money coming in -- increases. In 2027, it's about $200 billion a
year. That's above and beyond the payroll taxes we're collecting. Ten
years later, it's about $300 billion. Every year, the situation gets
So you can imagine what will be happening if we don't do anything.
You know, Congress is going to show up, and somebody says, we're $200
billion short. Where are you going to get the money? Well, you can
tax somebody to get the money; you can get rid of the benefits that you
promised; you can cut other programs; or you can keep borrowing debt.
That's why I think we've got a problem.
Now, before I start talking about what I intend to do about it,
I've got to make some things just as plain as I can. If you're a
senior citizen today on Social Security, you don't have to worry about
it. The trust has got plenty of money to take care of you.
I understand how this issue works. Everybody says, he's talking
about Social Security, there goes my check. That's what happens all
the time when they're talking about Social Security. You're in good
shape. And if you're near retirement, 55 years or above, you're in
good shape. Nothing changes. Those are the facts. The problem is, is
that the younger workers have got a problem. And I think we have a
duty to worry about our children and our grandchildren.
You know, 2018 may not -- may seem like a long way down the road
for people who are running for office every two years. It's not that
far down the road. If you've got a five-year-old child, that child
will be 18 years old before you know it, and the Social Security system
starts losing money. In 2042, the system will be broke. Again, for
some of us in politics, that may seem like ages. You know, don't worry
about it; 2042 seems like forever. And in my cases, of course, I'm not
going to be around in politics. I'm moving on after four years. But,
nevertheless, it's not that far. And the longer you wait, the harder
it is to fix the problem.
So my judgment is -- and that's why I went in front of Congress
yesterday, and said, okay, let's fix the problem. And I put all ideas
on the table, except for running up payroll taxes. If you've got a
good idea, bring it. No President, I don't think, has ever said that
when it comes to Social Security. Some of you veterans may remind me
whether that's the case, or not. I don't think so. I'm willing to
stand up with the Congress, I don't care if it's a Republican idea,
Democrat idea, independent idea -- bring them forward. Let's work
together and fix the system. (Applause.)
There are a lot of ideas out there -- thank you all -- there's a
lot of ideas out there. I mentioned some of the authors of the ideas
last night. I've got one myself that I think is a very interesting
idea -- along with others. What I'm about to tell you will not
permanently fix Social Security -- by the way, there's no need just to
put a Band-Aid on the deal. If we're going to get after it, let's fix
it permanently. Let's let people look back generations from now and
say, I appreciate the way the Congress and the President worked
together to do what was right on Social Security. (Applause.)
So let me give you an idea that I think is worth considering. I
thought it was worth considering so much, I put about five paragraphs
in my speech into it, you know. (Laughter.) And it's this: I believe
you ought to be able -- allowed to take some of your own money, payroll
taxes, and set up a personal retirement account, on a voluntary basis.
And the reason why I believe that is because the rate of return in your
account will be greater than the rate of return on the money you're
getting in Social Security. And that's important. Because if you're a
younger worker and set aside some of your money that would normally be
going into the trust, into a persona account, over time, that rate of
return grows and accumulates. And you end up with a nest egg, I guess
is the best way to put it -- a nest egg that will then complement your
Social Security checks when you finally retire.
Now, there's a lot of questions about this, of course -- can you
take it to the lottery? Is that considered an investment? Can you
take your payroll taxes and set up a fund and go to the lottery or the
track or shoot some dice? The answer is, no. (Laughter.) Obviously.
You have to have a conservative mix of stocks and bonds. And there are
a lot of funds that are conservatively tailored so you can get a
reasonable rate of return. Obviously, the lower the risk, the lower
the rate of return. But it should be a rate of return greater than
that which you're earning in the Social Security trust, and that's
important over time.
Secondly, you just can't once you retire pull it all out. In other
words, there will be a phased withdrawal in order to make sure that the
Social Security benefits you get, coupled with the money coming out of
your own personal account is done in such a way to help you retire.
Third, there are ways to make sure your fund can avoid swings in
the market at the very end of -- right before you retire. So there's
some wise things we can do, just like we do for the federal government
employees, see? They've got this plan; it's called the thrift savings
plan. My attitude is, if it's good enough for people working in the
federal government, it ought to be good enough for people working
elsewhere in America. And I -- (applause.)
I like the idea of you owning something. I love an ownership
society. We want more people owning their own home. We want people
owning their own business. We want people owning their own farm. We
want people owning and managing their own health care accounts. And I
think it makes sense to have people owning and managing their own
retirement account. (Applause.)
So we're going to talk about Social Security. And by the way, this
will be phased in. I know they're throwing out all kinds of numbers --
$1 trillion, $2 trillion, $3 trillion. When you get to the federal
government, we -- it's no longer millions or billions, it's trillions
at the federal government. It's amazing, isn't it? Anyway, we're
going to phase it in. That doesn't all happen -- happen at once. I
think it's important to -- gradually phase in the idea of personal
accounts so younger workers can get used to it, and so that the plan is
more affordable, so it's more fiscally sound, fiscally responsible to
fade [sic] it in. And we put out such a plan that will help people
understand that we can do this without busting the budgets. And that's
important for people to understand, as well. No, this is doable. It's
just going to take some political will.
Now, I want to talk to somebody who professes to be an expert.
Actually, he is an expert. We were in Fargo earlier, and he handled
himself brilliantly for a professor. No. (Laughter.) Jeff Brown, from
the University of Illinois, knows the subject well. He is obviously a
good sport. He takes a pretty good needle. And -- but tell us -- just
give us -- back me up. You've studied the issue. (Laughter.) Now,
I've come here and they say, what do you expect the President to say.
Put some expertise out there.
DR. BROWN: Happy to do so, Mr. President. And thank you very
* * * * *
THE PRESIDENT: What was the life expectancy when Franklin
Roosevelt designed the program -- or Congress -- 60, maybe? I think it
DR. BROWN: Back in the 19 -- in the mid-1930s, a person born in
the United States could expect to live, on average, around 60 -- low 60
THE PRESIDENT: See, that's how the system was designed:
pay-as-you-go as you work, people not living very long. It's changed.
The world has changed. The system hasn't changed with it. And that's
what we're talking about.
You got any other thoughts, Professor?
DR. BROWN: Sure, I'll go on as long as you let me. (Laughter.)
THE PRESIDENT: Reminds me of my college days. (Laughter.)
DR. BROWN: I'm used to having an hour and 20 minutes with an
audience that can't leave.
THE PRESIDENT: When I was awake. (Laughter and applause.)
DR. BROWN: The other thing, I just --
THE PRESIDENT: Talk about the personal accounts. I know -- it
obviously makes some people nervous. It's a new idea. It's a new
concept. People -- all of a sudden, when you take a system like Social
Security, that's been around so long and it has done a lot of really --
made a big difference in people's lives, and you throw out a new idea
-- it's the world in which the status quo sometimes is the easy default
position. And -- give us some thoughts on that.
* * * * *
THE PRESIDENT: So Leo Keller is with us. He said, do you mind if
I wear my hat? I said, not all, Leo. It's a fine-looking hat.
(Applause.) Thanks for wearing it. I'm glad you're here. Welcome.
Leo, you're here to talk about Social Security. Give us some wisdom.
* * * * *
THE PRESIDENT: Yes, that's a really interesting idea. What he
just said is very important. Once people get into the habit of
savings, it encourages other savings. This society is -- Leo, first of
all, a couple points. One, you made my point on life expectancy.
(Laughter.) You're looking strong at 79, headed to 80. You're doing
MR. KELLER: Thank you.
THE PRESIDENT: Secondly, it is important for Leo to know that
nothing changes. There are a lot of people out there saying, they've
heard the Social Security debate, I wonder really if this means I'm not
going to get my check. I cannot -- I'm just going to say it again and
again and again. Matter of fact, this is stop two of five where I'm
traveling around the country; I know I've got a lot of explaining to
do. And one of the most important explanations of all is Leo is going
to get his check. Nothing changes. The system is sound. (Applause.)
Any discussion about younger workers does not mean that Leo and anybody
like Leo is not going to have the promise that the government made.
That's just really important to know.
And thirdly, you're right about your grandkids. See, I like a guy
who says, my grandkids are capable of owning and managing something.
It's a different mind-set. The 401ks, for example, have changed the
attitude toward investment, hasn't it? I mean, a 401k, when you were
coming up, Leo, was just three numbers and a letter in the alphabet.
(Laughter.) And now it's an idea, where people manage their own
retirement, and they own something, they see it, it's visible. It's an
important part of our society today, and it seems like to me, as we
modernize the system of Social Security, we incorporate a portion of
that new system into the concept of somebody owning something.
So thanks for coming, Leo. You did a fabulous job. And the hat,
listen, I'm telling you --
MR. KELLER: My pleasure.
THE PRESIDENT: Those women look at that hat and that club, and
they're going wild. (Applause.)
Kelly Kost -- Kelly, thanks for coming. What do you do?
MS. KOST: I am in sales and administration. I work for Mission
Mountain Les Schwab Tires in Ronan, Montana.
THE PRESIDENT: Ronan?
MS. KOST: Ronan, yes.
THE PRESIDENT: How many people live there?
MS. KOST: I have no idea. (Laughter.)
THE PRESIDENT: Either do I. (Laughter.) At least you know where
it is. (Laughter.) Talk -- talk about Social Security. First of all,
Kelly has got the hardest job in America. She's a single mom.
MS. KOST: I've been a single mom since 1989. My twins are
18-years-old -- Jade and Jordan.
THE PRESIDENT: Where are they? Yes.
MS. KOST: Jordan is a member of the Army National Guard.
THE PRESIDENT: There you go. (Applause.)
MS. KOST: Jade will be the valedictorian of her class --
THE PRESIDENT: There you go. Your mom is humiliating you, but
it's good to know. (Applause.) Very good.
MS. KOST: Yes. And they will both be entering college this fall.
THE PRESIDENT: Fabulous, mom. You're doing your job.
MS. KOST: Thank you, thank you.
THE PRESIDENT: Listen to your mother. (Laughter.) I'm still
listening to mine. (Laughter and applause.) Let's talk about Social
* * * * *
MS. KOST: I'm just wondering how user-friendly these will be.
THE PRESIDENT: Yes, that's a fabulous question. There are a lot
of people who are comfortable with making investments; there are some
people who are just worried about it -- is it hard? And the answer to
the question is, it will be incredibly user-friendly. It's got to be,
because the options will be limited. The key is to allow people to
have their own account that gets a better rate of return than the money
in the current system. And over time, that will inure to your
And you can do that with a very conservative mix of stocks and
bonds. The Professor talked about -- Doctor or Professor, which one --
either one? How about, "Jeff?" Anyway -- (laughter) -- he talked
about the thrift savings plan for federal employees. There are five
options. And it spelled out what the options are. In other words,
you're not going to have to go in and pick stocks. You'll pick a group
of stocks or a group of bonds or a mixture of them. And they'll be
described to you. So, yes, it's very user-friendly. And that's a very
The other questions I get are, can you just jerk your money out at
any time? No. This is a retirement fund. It's meant to help you
after you retire. The benefits of this idea is, one, it gets a better
rate of return. It just will. Over time, you'll hear, well, the stock
market will crash and, therefore, I'll lose all my money. Well, first
of all, if you study the history of investment over a 15- or 16-year
period of time, there's always been a positive return. Now, there may
be a down year. But over time, we're talking about you get a positive
return. And there are investment vehicles that would help deal with
any market decline. But we're talking about a mix -- a conservative
mix of stocks and bonds. And that's an important question.
Now, the other benefit, of course, is that it's yours. Your Social
Security benefit is simply a promise. You don't own it, the government
will decide. The government can't pay for it, the government says,
well, we're going to reduce your benefits.
When you have your own personal account, it's yours. The
government cannot take it away. And you can give it to whatever child
you decide -- unless you get mad at them and then give it to somebody
else. (Laughter.) But it's -- and that's an important concept about
-- when you're talking about ownership. We're talking about a better
rate of return on your money, something you own that cannot be taken
away, and something you can pass on from one generation to the next.
And that's an important concept. Young families ought to be thinking
about, obviously, saving to pass on from one generation to the next. I
don't see why we can't incorporate that into the Social Security
system. Because I know it can work financially. As a matter of fact,
it makes the system more sound. It makes it more likely a younger
worker is going to end up with that which the government has promised.
And that's important.
Speaking about young couples, Amy and Mike Borger are with us.
MRS. BORGER: Thank you. (Applause.)
THE PRESIDENT: Where do you both live?
MRS. BORGER: We live in Great Falls.
THE PRESIDENT: Right here. (Applause.) Beautiful town full of
great people. I was touched by the number of people that came out and
waved. And I thank them for that.
Do you have children?
MRS. BORGER: We do. We have our daughter, Jordan, is 12, right
down in the front. And our son, Shane --
THE PRESIDENT: There she is, Jordan waving. That's good.
MRS. BORGER: -- is two. And we're expecting our third baby in
THE PRESIDENT: Awesome, yes. Georgia -- you're going to name it
Georgia? No. (Laughter.)
MRS. BORGER: No.
THE PRESIDENT: I don't blame you. (Laughter.) Tell me about your
ideas on Social Security. Thoughts, worries, concerns?
MRS. BORGER: I guess, we're in a unique position in our life. I'm
fortunate enough to still have my four grandparents living. It's very
important to me that system that has been promised continues to be the
same for them. Looking for our -- my husband and myself, we want to
make sure that when we're ready to retire, the system is what has been
promised to us, as well as for our children. And we appreciate the
chance to be given an opportunity to have a hand in that with the
THE PRESIDENT: Yes, thanks. If you look over your shoulder, which
you've already done -- you can actually look right there -- you'll see
it's not going to be around unless we do something now. These good
folks are in the danger zone unless Congress acts, because the cash
deficits increase every year starting in 2018. That's an important
date for people to remember. They may argue in Washington -- it maybe
2019, or 2018 and a half. It's happening, is the point. And it gets
worse every year. I repeat to you -- in 2027, we're looking for $200
billion extra to pay what has been promised. I don't know how Congress
is going to deal with that in 2027 unless we act now.
And we need to think about young families. You're a high school
MRS. BORGER: I am.
THE PRESIDENT: You lucked out, buddy. I married a school
librarian, too. (Laughter and applause.)
MR. BORGER: It can be hard at times, can't it?
THE PRESIDENT: No, not at all. (Laughter.) Well, if it has, I'm
not confessing publicly. (Laughter.)
What do you do?
MR. BORGER: I'm a supervisor at Poulson's. It's a home
improvement center here in Great Falls.
THE PRESIDENT: Great, good, good. (Applause.) Some of your
fellow employees are here. That's good. They probably want a personal
account, as well.
MR. BORGER: A good friend of mine that I work with, his son is
serving in Iraq right now.
THE PRESIDENT: Where's he -- where is -- where's Dad? Appreciate
it. Email your son, we're proud of him. (Applause.) It had to make
you feel good, Dad, last night when the Iraqi lady hugged the mom of
the fallen Marine. I know it made her feel good. It was a -- it was a
show of gratitude from the Iraqi people that said, thank you for our
freedom; thank you for the sacrifice. Your son is serving a noble
cause, sir -- security of America and peace to the world. (Applause.)
I'll tell you something really interesting that Amy is doing, by
the way. We'll get to Social Security in a minute -- kind of
meandering around. (Laughter.) Amy is into distance learning. Where
do you go?
MRS. BORGER: Boise State University.
THE PRESIDENT: From your living room?
MRS. BORGER: From my living room.
THE PRESIDENT: Interesting thought, isn't it? The reason I bring
that up is, obviously, education is vital for the future of the
country. No Child Left Behind is working. We're going to keep it
strong, we will not undermine it. (Applause.) On the other hand,
we've got to be wise about how we use technology. Think about that --
the education system has changed; Social Security hasn't. Anyway,
education -- here she is going to get a --
MRS. BORGER: Masters in educational technology.
THE PRESIDENT: Yes, from your living room. Pretty cool, isn't
it? We've got to keep those kind of -- keep these ideas moving. And
Boise State has done a good thing to allow you to do that.
All right, Mike, back to Social Security. Do you think you'll ever
MR. BORGER: I hope to.
THE PRESIDENT: Yes. It's an interesting question -- I just want
to stop you -- I promise you're going to get more than two words in
here. (Laughter.) It may be hard to tell. (Laughter.) Doesn't that
kind of worry you when the young guys says, I hope to? (Laughter.)
When old Leo was his age, he said, no question. Are you going to see a
Social Security check? No doubt. Now we've got youngsters saying, I
hope so, as if there is doubt. And there should be doubt.
MR. BORGER: My wife and I work very hard for what we earn. And we
have a lot of bills and day care and two children, and a third on the
way. And it's hard to set money aside to start our -- to start our own
IRA and that stuff. So we're very dependent on what Social Security or
the personal accounts can offer. So it's real important to us that
something gets reformed and things change so that there is a guarantee
for us and our children. And also, it's a concern to me that people
like Leo and my in-laws and my parents and friends of mine that are
coming upon the age that they retire, that their Social Security that
they worked very hard for won't be touched.
THE PRESIDENT: Right.
MR. BORGER: And that that will be there for them.
THE PRESIDENT: It will be. And I can't guarantee for you. That's
what we're here to discuss.
See, I'm traveling around because -- first of all, I believe in the
will of the people. I believe that people can influence policy. And
so the next couple of months I'm going to be traveling the country,
telling people I think we got a problem, and asking people to get
involved. Nothing changes for Leo, but this couple that's about to be
raising three kids is -- they're going to have a system that's just not
going to work unless this United States Congress and the President act
I believe it's going to happen. I really do. Oh, the pundits will
say it looks too tough, and this -- somebody said it's not going to
happen, and somebody opined it's not going to happen. But when the
people really figure we got a problem, they're going to demand a
solution. They're going to say to members of both political parties,
what the heck are you doing in Washington, D.C. if you're not willing
to settle down and solve the problems facing this generation?
I'd like to answer a few questions if you've got any. I'm sure
somebody has got a few. Yes, sir, with that shirt on. Fine-looking
shirt you got there. Thank you all for coming out, by the way. It's
a -- it's a joy to be here. (Applause.)
Q Mr. President, do you foresee that if we fix this program, we
can move the retirement age back to 65? For some people it's 66, 67,
68, and on and on.
THE PRESIDENT: Yes. Well, there's a lot of discussions about
whether we ought to move it back or move it forward. And that idea is
on the table. Again, this is one of those ideas where, in the past, if
you talked about it, somebody would club you over the head with it in a
political race. And I think we ought to debate whether or not the age
ought to be 65, 66, 67. These are for younger workers now -- nothing
changes for older workers. And that's on the table. That's what I
said last night. I reminded people that my predecessor, President
Clinton, suggested that that might be part of a solution, to raise the
retirement age. But I don't think you can end up making that decision
now until you look at all the other options. And we're just going to
have to take the hard look at all the different options on the table.
And people are living longer -- but this all, again, pertains to
younger workers. And it's -- it will be part of the debate that goes
on in Washington, D.C. And I'm willing to have it.
Yes, ma'am. Just can barely stand it. (Laughter.)
Q Sir, you are a blessing. And our family prays for you every
THE PRESIDENT: Thank you. (Applause.) Thank you for saying
Q My husband and I are privileged to have a 35-year-old daughter
who is mentally disabled. And she works hard in a supportive living
center in Helena, Montana. And many people against your proposal are
trying to scare the disabled by saying they will lose their Social
THE PRESIDENT: Not true. Nothing changes.
Q -- which she needs. So is she okay?
THE PRESIDENT: Nothing changes when it comes to the disabled --
the disability aspect of Social Security. This is all aimed -- all
discussions about the retirement aspects of Social Security.
(Applause.) I'm glad you asked that. Thank you for your prayer.
I tell people this -- I tell people this: I don't see how a
President can do the job without the prayers of the people. I know
other Presidents probably wouldn't agree with that, necessarily.
(Applause.) I quoted Abraham Lincoln today. He said, "I would be," --
I think -- I kind of paraphrased him. We actually had the National
Prayer Breakfast this morning. Started off by saying the State of the
Union was kind of like a prayerful session. They were praying I'd
hurry up and finish the speech. But it's -- (laughter.)
Anyway, I quoted Abraham Lincoln who said, I don't see how you can
be President without prayer, is what he said. And I agree with that
assessment. One of the most powerful -- (applause) -- of the
presidency is to know that people are praying for me and Laura. And I
want to thank you for that.
Having said that, I also want to -- I know there's a lot of talk
about religion and politics. It is essential that whoever the
President is and whoever is in Congress always honor the fact that in
this country, you can pray, or not pray, and be equally American. You
can be a religious person, or not a religious person and be equally
viewed as a patriot. And if you're religious, you're equally American
if you're a Jew, Christian, Muslim, Hindu. That's the greatest thing
about our country. That's what distinguishes us from the Taliban, is
the freedom to be -- the freedom to choose what you want to choose.
You've got a question? All right, thank you.
Q Mr. President, I was reading in a liberal newspaper today --
THE PRESIDENT: Sounds like a loaded question to me. (Laughter.)
Q An opinion was that, on the average, individuals will make
about six-and-a-half percent on the market over time, and that that was
less than what is being made in the Social Security system.
THE PRESIDENT: No, that's -- I don't want to subscribe a political
label -- I would describe as somebody who doesn't know what they're
talking about. (Laughter.) That's just not the truth. Professor?
DR. BROWN: That's what I'm here for, is to find the truth.
THE PRESIDENT: Thank you, sir. Thank you. Thanks for coming.
DR. BROWN: Yes, historically, over the last 80 years, the stock
market has returned about seven-and-a-half percent over inflation, and
that's far higher than you get from government bonds or on the return
from the current system.
THE PRESIDENT: Well, he's talking about the return within the
Social Security system, and it's, like, near zero.
DR. BROWN: It's about 1 to 2 percent for --
THE PRESIDENT: And the difference between 1 percent return on your
money and 4 percent return on your money over time is significant?
DR. BROWN: Yes. Just to give you an idea of the difference
between -- suppose you invested $1,000 a year from the time you're in
your early 20s until you retire, suppose you get a 3 percent rate of
return, you might have about $65,000. Get a 7 percent rate of return,
you're going to have over $200,000. So it's a very big difference.
THE PRESIDENT: That's how money grows. And that's an important
concept that we need to incorporate if we want the Social Security
system to be available for younger families and younger workers. It's
a really important part of a reform package.
Okay, any more questions? I'm kind of winding down here because
I've got to head on to Nebraska. Yes, ma'am? The red shirt.
Q I have one -- I kind of have one question for you.
THE PRESIDENT: Sure.
Q Can you quote Proverbs 17:17 for me?
THE PRESIDENT: Do what?
Q Can you quote Proverbs 17:17 for me?
THE PRESIDENT: No. (Laughter.) That's an easy one. Can you?
Q "A friend loves at all times, and a brother is born for
THE PRESIDENT: Thank you. (Applause.) Very good. I thought you
were going to ask me if I knew how to get to Livingston. (Laughter.)
It's like that guy, said, what color -- he said, to get to Livingston,
you've got to go down the highway and you go through the cattle guard,
and you -- (laughter) -- turn left, and go through another cattle
guard. And a fellow comes back and says, hey, what color uniforms do
those cattle guards have on? (Laughter and applause.) That never
happens in Montana.
Q Thank you, Mr. President, for coming to Montana.
THE PRESIDENT: Nice to be back. Big Sky. (Applause.)
Q When my wife and I continue to pay into the system, what
percentage of that will we have the opportunity --
THE PRESIDENT: Yes.
Q -- to invest in? And what kind of mountain bike do you ride?
THE PRESIDENT: I'm not supposed to endorse products, but it's
called a Trek. (Laughter.) Are you a mountain bike, guy?
Q Yes, I am.
THE PRESIDENT: Oh, listen, let me -- I'll get to the -- I'll try
to remember what -- the real question you asked. (Laughter.) First of
all, I hope people exercise on a regular basis. It's -- I can't tell
you how important it is for you. Unfortunately, I exercised too hard
for a while and can't run anymore. But I did discover mountain
biking. It's got to be fabulous mountain bike country, right?
Q It is.
THE PRESIDENT: Yes. Unlike, you however, I'm a safe mountain
biker. I'm looking at -- you look like a risk-taker, you know?
(Laughter.) Like ride those little tiny trails -- that's not me.
Now, I really -- the best health care plan -- one of the aspects of
the best health care -- any good health care plan is to encourage right
choices. What you put into your body matters, and how you treat your
body matters. And so I -- thank you for bringing up -- giving me a
chance to segue into exercise. As a matter of fact, prayer and
exercise are what keeps me going as -- (laughter) -- as the President.
(Applause.) And family and friends -- family and friends, especially
The way the system works -- in order to make it work fiscally, is
that you can start off with $1,000 into your account growing $100 a
year up to 4 percent of your income. That's to answer your question.
The idea is ultimately there will be -- if you're making $90,000, you
can put $3,600 a year into your personal account. That's how you keep
it more affordable than the numbers that have been -- being tossed
Yes, ma'am. Good to see you again.
Q Hi, how are you? As usual our prayers and love are with you.
But I -- I could have several questions. One of them, though, going --
THE PRESIDENT: Just ask an easy one.
Q It is. (Laughter.)
THE PRESIDENT: Kind of getting late in the day.
Q The medical -- it's a medical issue.
THE PRESIDENT: Yes.
Q With the frivolous lawsuits, one of the problems, too, is that
attorneys charge so much to bring even a fair lawsuit to the court
system, that the victim, the patient winds up with nothing and the
attorney winds up with all the money.
THE PRESIDENT: Right.
Q And the doctor is being run out of business. Can that somehow
be worked in there?
THE PRESIDENT: I don't believe that -- no, I'm -- I just -- I
guess, I could give you a political answer and say, I'll think about
it. I actually don't think the government should regulate legal fees.
I think that ought to be set by the market, so to speak. (Applause.)
I don't think government ought to set price. I do think government,
though, can set limits for lawsuits that -- that are filed.
And the thing in medical liability reform that I think will make a
big difference is to have a hard cap on non-economic damages. In other
words, you're allowed to get economic damages, but the non-economic
damages need to have a hard cap, which will reduce the desire for
people to keep filing lawsuits as if the medical liability system were
a lottery. But in terms of whether or not the government ought to be
setting legal fees, I don't think so. I don't think so.
Let's see, a couple of more, then I got to hop. Yes, ma'am.
Q Thank you, Mr. President. We're excited to have you for
another four years, and we stayed up half the night waiting for the
THE PRESIDENT: Yes, thank you. (Laughter.) Thanks. Well
Q My question is, as this privatization of Social Security comes
into effect, who will manage that? Has that been talked about at this
THE PRESIDENT: I would call it, personal retirement accounts, is
the proper terminology, because it basically means, you own it. See,
privatization says the whole thing changes. Not true. A portion, as I
said, 4 percent ultimately, of the money that you earn can go into a
personal account that you call your own. Who manages it? You do. You
make the decisions. You make the -- on that aspect. The Social
Security Administration will still exist for the other aspect of Social
Security. It's a mixture. It's a blend. In other words, part of your
money goes into the system, and the government will pay out benefits.
Part of your money goes into your own personal account, which you will
manage. You will get on a quarterly basis, your statement about how
much of your money has grown over -- and how has it grown over a period
of time. But the other portion of the Social Security will continue to
be managed by the federal government, the Social Security trust.
How about the little guy in the hat? Number seven.
Q Can me and my friend shake your hand?
THE PRESIDENT: Yes. Move on over here. (Applause.) Okay, last
question. Have you got a question? You don't have a question. You
want to shake my hand, stay right there. I'm coming down.
Q As an employer of a small business, I have to express a
concern. How will employers handle these deposits for our employees?
THE PRESIDENT: The federal government will be the administrator to
make sure that the accounts are properly set up.
THE PRESIDENT: This is -- this can be done without a lot of
additional paperwork. And again, this is a -- the purpose is not to
create excess bureaucracy. Quite the opposite. The purpose is to
empower individuals, and that the employer won't be charged with making
sure that the paperwork is managed properly.
Let me talk about small businesses real quick. The tax cut that
Max and I and Conrad and Dennis -- Denny worked on is really important
for small businesses. That's why it's really important we not allow
taxes to go up. Seventy percent of new jobs are created by small
businesses in America. And I'm proud to report the small business
sector of our country is strong and vibrant and doing well. And we
need to keep it that way. (Applause.)
Thanks for being an entrepreneur. You staying in business? That's
Listen, let me conclude by thanking you all very much for your
hospitality, your generosity of your time, and your strong love for our
country. We are lucky people to live in the greatest country on the
face of the Earth.
May God bless you all, and may God continue to bless our land.
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