Excerpt from July 24, 2002 Press Briefing with
White House Press Secretary Ari Fleischer

Click here for the full transcript

Q: Ari, under the president's plans for Social Security reform, what would happen to investors -- young investors or anybody -- who took part of their Social Security money and put it in the stock market and saw the kind of drop in the market that has happened?

FLEISCHER: It all depends on the exact dates in which people began their investments. And so, if they began their investments in 1982, for example, their return on their money would be sharply up. So it's an idiosyncratic matter, depending on the exact circumstances of people's times and investment decisions.

But the president does have faith in allowing younger workers, as a part of Social Security, to have the option, at their choice, of investing a portion of their Social Security taxes in other investments rather than just having it withdrawn from their paycheck in a system where the demographics clearly show they will not get a return on their money.

Q: Would there be any backstop, safeguard for investors if the market were to drop on them by, you know, 10 percent, 20 percent?

FLEISCHER: It would all depend on any decisions that Congress makes as legislation is put forward. But suffice it to say, the president does have faith, fundamentally, in the ability to people to use their own discretion, make their own judgments.

FLEISCHER: And he thinks that younger workers will welcome the opportunity to have more control over their own money so they can make decisions as they see fit.

Q: Last question. Still, has what happened in the markets undermined political support for the president's plan?

FLEISCHER: No. The president is focused on doing what's right long-term, the right policies. And the president is very worried about the future of young people.

People who are older than 50, for example, right now, they're going to be no changes under what the president proposed for Social Security. So what the president is talking about are no changes at all for people approaching the retirement age. They will continue to get Social Security. Social Security will be there for them.

But the president is very worried about younger people who are going to pay a lifetime of high taxes and, under current trends, not get back the money they paid in for Social Security. That's a negative rate of return. And the president wants to provide them with more options if they decide they want to exercise them on a voluntary basis. He thinks that's something that younger people deserve to have the right to choose.

Nobody who's ever looked at -- nobody who's looked at that thinks that that's going to happen. They disagree over the options, but everyone thinks that something is going to be done.

Isn't it deceptive to be saying to younger workers, as you say repeatedly, "You're going to get nothing out of this system"?

FLEISCHER: Well, under current trends, they will. It's an accurate statement. And the three...

Q: (OFF-MIKE)

FLEISCHER: Well, the reality is that there are three options available: One is to raise taxes, which has been done before and hasn't worked. The second is to cut benefits, which is something the president doesn't support.

And the third is exactly the president's proposal, to allow younger workers the right on a voluntary basis to put a portion of their Social Security taxes and other investments -- whether they're fixed-income investment, bond investments, equity investments -- as younger workers see fit.

This is for more choices for younger workers, and I think that's something that younger Americans are looking forward to, and they understand the value of a long-term investment.

Nobody who's ever looked at -- nobody who's looked at that thinks that that's going to happen. They disagree over the options, but everyone thinks that something is going to be done.

Isn't it deceptive to be saying to younger workers, as you say repeatedly, "You're going to get nothing out of this system"?

FLEISCHER: Well, under current trends, they will. It's an accurate statement. And the three...

Q: (OFF-MIKE)

FLEISCHER: Well, the reality is that there are three options available: One is to raise taxes, which has been done before and hasn't worked. The second is to cut benefits, which is something the president doesn't support.

And the third is exactly the president's proposal, to allow younger workers the right on a voluntary basis to put a portion of their Social Security taxes and other investments -- whether they're fixed-income investment, bond investments, equity investments -- as younger workers see fit.