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President Bush

day after President Bush went on television to try to rally support for his Social Security reform proposal, key lawmakers in the House and Senate announced their plans for the issue.

The president has made the effort to allow Americans to divert a portion of their Social Security taxes into personal investment accounts the centerpiece of his second-term agenda but he has offered only general principles and no specific plan for dealing with the program's significant financing challenges. (Social Security trustees project that the program's trust fund will be exhausted in 2041, leaving it able to pay only about 74 percent of promised benefits.) In a prime time news conference on April 28, though, Bush, while still not presenting a detailed reform plan, indicated that he would support benefit reductions for retirees with higher incomes. He continues to rule out an increase in the 12.4 percent Social Security tax, although he has held open the possibility of raising the cap on wages to which the tax applies from its current level of $90,000.

In the wake of Bush's news conference, leaders of the two congressional committees that have jurisdiction over Social Security laid out plans to consider reform legislation within a few months. Senate Finance Committee Chairman Charles Grassley of Iowa, whose panel held a hearing on April 26 to consider reform proposals (see story below) said he plans to hold another hearing in May and to present legislation to the committee this summer. House Ways and Means Committee Chairman Bill Thomas of California, meanwhile, said that, starting May 12, his panel will hold at least one hearing a week on Social Security until a bill is produced, "probably in the early part of June."

Democrats remain strongly opposed to GOP plans for personal accounts, though, saying the accounts would only increase the program's financial problems while diminishing the retirement security of retirees. Max Baucus, the Finance Committee's ranking Democrat, said after the president spoke that he was "saddened ... to hear that privatizing Social Security is still a focus. Congress cannot and will not support a risky new scheme that would add trillions of dollars to the debt and mean huge benefit cuts for Americans."