WASHINGTON (Reuters) - A decade after President Bill Clinton's ambitious scheme to overhaul U.S. health care turned into a political debacle, some are wondering whether President Bush's Social Security plan could go the same way.þþ``There are some parallels, although Clinton was dealing with a much more complex issue with a multiplicity of interests and providers,'' said John Palmer, a professor at Syracuse University who is a trustee of the Social Security and Medicare trust funds that provide retirement payments to millions of seniors.þþ``Certainly, this issue will lend itself to demagoguery on both sides,'' said Palmer.þþOne key similarity: powerful interests are already lining against the proposed Bush reform, which envisages younger workers being able to put some of their retirement contributions in individual investment accounts.þþA group called the Campaign for America's Future, which unites labor unions, minority, women's and disabled groups, has already vowed to oppose the plan. The powerful and well-funded AARP, formerly known as American Association of Retired Persons, has also come out against private accounts.þþ``Taking some of the money that workers pay into the system and diverting it into newly created private accounts would weaken Social Security and put benefits for future generations at risk,'' the group said in a statement.þþThese groups certainly have the means to launch an aggressive TV advertising effort when the eventual legislation reaches Congress, similar to the campaign launched by the insurance industry that sunk the Clinton health plan in 1994.þþOn the other side, Wall Street, which stands to benefit from managing billions of new dollars, strongly supports Bush's idea of private accounts and could be expected to provide crucial financial muscle to get it enacted.þþ``The Clinton plan was done in by aggressive advertising by the insurance industry but this time the industry most affected is Wall Street and they are powerfully behind it,'' said Massachusetts Institute of Technology economist Peter Diamond.þþPUBLIC SKEPTICALþþUnlike Clinton, Bush is starting out with a disadvantage in public opinion, although most experts believe the issue is not yet well understood. But a Wall Street Journal/NBC News poll last week found that by 50 to 38 percent respondents thought it was a bad idea to allow workers to invest a portion of their Social Security taxes in the stock market.þþRichard Burkhauser, a Cornell University economist who served on a committee that evaluated the assumptions of the Social Security actuaries, said Bush was glossing over the problem by portraying private accounts as the entire solution.þþ``The unfortunate reality is we're either going to have to raise taxes or cut benefits in some way to get the system into balance,'' he said. ``Private retirement accounts will not in themselves entirely solve the problem.'' þþDiamond said most Americans were not yet aware that the Bush plan would need to include a reduction in benefits, since the President has completely ruled out raising payroll taxes.þþ``When it becomes understood that there are benefit cuts, the public won't like it. For a long time, polls have made it clear that Americans support increasing taxes to avoid reducing benefits,'' he said.þþBush may also find he is not leading a totally united Republican Party into this battle. Republicans who worry about the national debt are uncomfortable with the idea of borrowing trillions of additional dollars, which will be necessary to make up the shortfall as contributions are partly diverted from the Social Security trust fund into private accounts.þþOn the other hand, said Columbia University political scientist Robert Shapiro, most Democrats seem ``perfectly happy to battle Bush on this issue.''þþDemocrats dispute Bush's contention that the crisis is immediate, dispute his figures on the size of the shortfall and argue that the problem could be fixed with a judicious mix of tax increases and benefit cuts. þþ
Source: NY Times
