The Fix Behind Fixing Social Security

by Laura Miller

The Bush administration ventriloquists are out in full force these days, breathlessly hyping "voluntary personal retirement accounts" as a way to save Social Security (by destroying it). For the average voter, getting a handle on what the Bush administration is proposing to do to Social Security is quite a challenge. The dozens of bobbing heads and clicking fingers, holding forth on cable news programming and the internet is enough to make anyone's head spin. Is that spokesman from the Alliance for Worker Retirement Security speaking as an independent economics expert, a civic-minded individual or as a paid shill from a corporate-funded front group?

Historic Social Security Poster (National Archive)

If you're having trouble keeping track of all the players, our very own SourceWatch can help. It will tell you that the Alliance is sponsored by the National Association of Manufacturers, the U.S. Chamber of Commerce, and the Business Roundtable, among other pro-business groups. You will also learn that it shares its executive director Derrick Max and a number of its members with the Coalition for the Modernization and Protection of America's Social Security (COMPASS).

In late February, deputy White House chief of staff Karl Rove, National Economics Council director Al Hubbard, and Barry Jackson, a special assistant to the president who is handling Social Security reform, met with administration-friendly lobbyists for a "rah-rah" cheerleading session on Social Security privatization. According to The Hill, representatives from COMPASS as well as the conservative 60 Plus Association, America's Community Bankers, the National Retail Federation, the Mortgage Bankers Association and the Business Roundtable heard the trio reiterate George W. Bush's commitment to "reform" Social Security. ''Karl Rove talked about its importance to the president's agenda, and Al Hubbard talked about its importance to the economy,'' a spokesperson from the Roundtable told Bloomberg News.

"The White House is running this as if it's a political campaign,'' Free Enterprise Fund president Stephan Moore told Bloomberg. "There are regular meetings the White House has with all the groups to make sure everyone is singing from the same hymnal." To finance the campaign, business and trade association lobbyists are pressing their corporate members to fill the privatization collection plate. The New York Times' Glen Justice reports that although "most groups are still raising money, and the spending figures they quote are still often just targets, the lobbying could amount to more than $100 million."

COMPASS launched its "Generations Together" outreach effort in February. The group expects to spend $20 million on influencing public and Congressional opinion on Social Security privatization. The "grassroots" campaign will try to recruit more than 100,000 volunteers to voice their support for the President's Social Security plan at town hall meetings and rallies as well as make phone calls and write letters to members of Congress, demanding action on Social Security.

Another group leading the privatization charge is USANext. Formerly known as the United Seniors Association (USA), this corporate-funded group is member of the Alliance for Worker Retirement Security and COMPASS in addition to another pro-privatization group, the Alliance for Worker Prosperity. As USA, it spent millions of drug company dollars, creating the appearance of grassroots support for the industry-sponsored version of the 2003 Medicare bill that eventually passed.

In February, the New York Times reported that USANext had launched a campaign "to spend as much as $10 million on commercials and other tactics assailing AARP, the powerhouse lobby opposing private investment accounts." To oversee the operation, USANext hired Chris LaCivita, recently of the Republican 527 groups Swift Boat Veterans for Truth and Progress for America Voter Fund and an employee of the DCI Group, a well connected Republican firm specializing in astroturf. USANext's opening salvo was an internet ad that briefly appeared on the American Spectator's website. It equated the AARP with hating the military and loving gay marriage - sure signs of liberal decadence. The ad generated enormous online and print media attention for USANext and a lawsuit from the gay couple whose photograph was used in the ad without their permission. Despite being sued, USANext's campaign to steal AARP members and undermine its efforts to protect Social Security was off to a good start.

Collaborating with COMPASS and USANext in their aggressive push for privatization is Progress for America (PFA), a group closely tied to the White House. The PFA Voter Fund spent nearly $30 million on Bush's reelection. As part of its $20 million Social Security reform campaign, PFA announced it had recruited Texas A&M University economics professor Thomas R. Saving as an advisor and spokesman. Saving, however, was appointed by Bush as one of seven trustees for the U.S. Social Security Administration. The trustees issue reports on the current and projected financial status of the program, raising questions about potential conflicts of interest between his advocacy work at PFA and his role as a trustee.

Other PFA recruits include former U.S. Treasurer Rosario Marin and 9-year-old Texan Noah McCullough, whose "encyclopedic command of presidential history" has earned him five appearances on Jay Leno's "Tonight" show, according to the New York Times. McCullough, whose mother describes him as "very patriotic and very Republican," has become a highly visible volunteer spokesman for the White House, traveling to several states ahead of the President's planned visits and doing radio interviews, answering trivia questions and pitching Social Security privatization.

PFA, which claims nonprofit status, was set up in 2000 and shares staff with the Washington-based DCI Group. Records show that the PFA Voter Fund paid DCI about $800,000 during 2004 for work on the Bush reelection campaign. McCullough's media tour was "a brainchild" of Stuart Roy, a former aide to Representative Tom DeLay (R-Texas) who recently joined the DCI Group. "We'll have Noah there as the face of Social Security reform," the Times reports Roy as saying. "It's about the next generation."

Progress for America's online appeal for donations to air their TV ad 'Courage'.

PFA has also been airing television ads, one of which features footage of Franklin Delano Roosevelt. The ad, which has drawn criticism, shows FDR signing Social Security into law while the voiceover says, "It took courage to create Social Security." Over an image of Bush signing a bill, the ads says "It'll take courage-and leadership-to protect it."

PFA told the Houston Chronicle that it will be asking past donors for money to fund its new campaign. Charles Schwab, the head of the prominent investment firm, contributed $50,000 to the group's political arm in 2004. Schwab gave $75,000 more to the Club for Growth, which also is lobbying for Social Security privatization and expects to spend $10 million lobbying to promote private accounts. Peter J. Ferrara, an alumnus of the Cato Institute, Heritage Foundation and National Center for Policy Analysis, is heading the Club's Social Security Project.

While the business-funded lobby groups are busy in the PR trenches, President Bush and Vice President Dick Cheney are barnstorming the country, speaking at carefully orchestrated town hall meetings where they relentlessly paint Social Security in the red and promote their "voluntary personal retirement accounts." Bush told an audience of hundreds of supporters at the New Jersey Army National Guard Armory in Westfield that he emjoyed campaigning for privatization - "[I] like going around the country, saying, 'Folks, we have got a problem.'"

The real problem, however, is not with the Social Security program. The so-called Social Security crisis is an invention of ideological think tanks and corporate-funded groups. The liberal foundation-funded Center for Economic and Policy Research writes, "Social Security is more financially sound today than it has been throughout most of its 69-year history." The real problem is how the lobbyist-driven campaign to privatize Social Security marginalizes and renders irrelevant actual democratic discussion on Social Security and its future solvency.

"The emergence of the center-right phalanx backing the Social Security proposal is a major victory for the Cato Institute, a prominent libertarian group," the Washington Post's Thomas Edsall wrote. "In the late 1970s and early 1980s, Cato was almost alone in its willingness to challenge the legitimacy of the existing Social Security system, a politically sacrosanct retirement program. Recognizing the wariness of other conservatives to tackle Social Security, Cato in 1983 published an article calling for privatization of the system. The article argued that companies that stand to profit from privatization - 'the banks, insurance companies and other institutions that will gain' - had to be brought into alliance. Second, the article called for initiation of 'guerrilla warfare against both the current Social Security system and the coalition that supports it.'"

Clearly, the "warfare" has begun, although Republican strategists prefer more polite terms. "We're setting up an operation that is employing a campaign-type infrastructure, campaign-style tactics and really bringing election-year intensity to the debate," Republican National Committee communications director Brian Jones, referring to Social Security, told Bloomberg News. But as we've seen, "election year intensity" rarely, if ever, allows thoughtful dialogue on political issues. Instead, voters get the hard sell.

Nevertheless, Bush's "personal accounts" plan becomes less appealing the more voters learn about it. Bush and company face a skeptical populace, similar to the challenge they faced when selling the Iraq war. Convincing the public to go along with the dismantling of a popular 70-year-old program is no small feat. And unlike Iraq, this time Americans can see a direct threat to their own wallets. Afraid of even less money for retirement, voters are asking tougher questions. And their Congressional representatives, afraid of mid-term losses, are starting to pay attention to those concerns.

While the right is coordinated in its attacks on Social Security, it is fighting an uphill battle. By tracking and exposing its movements on our online SourceWatch, you can help make a difference. So far, we've catalogued over two dozen articles on individuals and groups that are promoting Bush's Social Security privatization plan. It's a good start, but the privatizers aren't even close to giving up, and neither are we.

Help expose the fix behind fixing Social Security. Visit http://www.SourceWatch.org/.