Social Security "does not face an immediate crisis," the head of the Government Accountability Office said Wednesday, but it does face a long-term financing problem "and it would be prudent to address it sooner rather than later."
David M. Walker, who heads the nonpartisan Office of Comptroller General, also criticized President Bush for undertaking an aggressive two-month tour to try to sell his plan for allowing younger workers to divert a portion of their Social Security payroll taxes into private investment accounts. Walker suggested that Mr. Bush and members of Congress focus on improving financing for the program, which would not be significantly affected by establishment of personal accounts.
The testimony launched formal debate, before the House Ways and Means Committee, on Capitol Hill over Mr. Bush's plan to overhaul the federal retirement plan that began as part of President Franklin D. Roosevelt's post-Depression era "New Deal."
"I would have done it differently, I would have done it differently," Walker said, under aggressive questioning by Rep. Charles B. Rangel of New York, the top Democrat on the panel. In his opening statement, Rangel declared, "Private accounts will not be on the table if you are looking for bipartisanship."
The panel's chairman, Rep. Bill Thomas, R-Calif., said in his opening remarks, "Clearly, the current program, because the American population has changed, is not sustainable based on the old method of financing."
Noting that Congress has not changed the program since 1983, the chairman also chided Democrats for opposing any potential cut in retiree benefits.
"In 1983, under the Democrat leadership, the solution included cutting benefits," Thomas said, adding that tax increases were also part of the 1980s remedy.
With polls showing that people are nervous about future financial shortfalls in the program, House Republicans intended to devote their first hearing to that rather than Mr. Bush's less popular idea of private accounts. Nonetheless, the partisan views surfaced in the hearing's opening minutes.
The trustees for the Social Security and Medicare trust funds are expected to release their 2005 report on the long-term financial outlook of government programs later this month. Two trustees who appeared at the hearing, Thomas R. Saving of Texas and John L. Palmer of New York, said there have been no major changes in the program's demographics or financial outlook during the past year, but they joined Walker in urging immediate action on long-term program financing.
"We believe that action on it should not be deferred any longer than necessary for due deliberation and decision," the two said in a joint statement released before their formal testimony. "Also, acting sooner rather than later will allow time to spread the burden of any changes across different age groups."
In his remarks, Walker said: "Social Security doesn't face an immediate crisis," but he added, "Time is working against us. The sooner you act, the less dramatic the changes that have to be made."
New Republican polling data shows "there is a rejection of the term 'crisis' as an accurate description of the state of the Social Security system, and this rejection increases in intensity as the respondents get older," according to a copy of a memo obtained by The Associated Press.
The analysis was based on 14 focus groups held last month in scattered locations paid for by the National Republican Congressional Committee, the campaign arm of the House GOP.
Older voters view a candidate's views on Social Security to be "as important, or in some cases, more important than issues like the war, health care and education," the pollsters wrote.
When focus groups are given information about Mr. Bush's plan, "the written description of the personal retirement account proposal creates majority support among all age groups (including 51 percent favor among seniors)," the memo says.
It also says public knowledge of the plan is sketchy and about half the "facts" that people recited about the plan were incorrect.
Social Security provides retirement, survivors and disability income for 47.7 million Americans, and Medicare provides health care to 42 million seniors and disabled people.
Last year, the trustees estimated that in 2018, the Social Security trust fund would begin taking in less payroll tax revenue than it needs to pay retiree benefits. The trustees estimate that by 2042, the trust fund will be empty and program will have only annual payroll taxes to pay benefits.
Mr. Bush has promised that any changes will not affect Americans 55 or older, but he advocates allowing younger workers to divert up to two-thirds of their Social Security taxes into personal accounts in exchange for a reduction in their guaranteed benefit. Supporters argue investment returns will exceed the guaranteed benefit they agree to forgo.
The proposal has been condemned by the AARP, a seniors lobby, and many Democrats, who argue the system can be tweaked to extend its solvency and that investment accounts are more risky than a guaranteed government benefit.