John Boozman supports "privatizing Social Security"
Blanche Lincoln on Thursday, August 19th, 2010 in a TV ad
Sen. Lincoln says Boozman wants to privatize Social Security.
Democrats used it to defeat President Bush's plans to change Social Security, and they're using it now to try to hold on to legislative majorities in the House and the Senate. We are, of course, talking about "privatization." In her latest TV ad, Senate incumbent Blanche Lincoln, D-Ark., says that there are "serious differences" between her and her opponent, Rep. John Boozman. First on the list, "unlike John, I am against privatizing Social Security and Medicare."
History has shown that accusing your opponent of wanting to privatize Social Security is a good political strategy. President Barack Obama has certainly taken notice. During the 2008 campaign, then candidate Obama accused Sen. John McCain of wanting to revitalize Bush's plan to "privatize" Social Security. We rated that Barely True. And during his weekly address in August, Obama said that some Republican leaders in Congress" are "pushing to make privatizing Social Security a key part of their legislative agenda if they win a majority in Congress this fall." We rated it Barely True once again.
So how does the evidence stack up in this case?
When Boozman ran for Congress in 2001, he said that he supported President Bush's proposal to allow individuals under 55 to divert a portion of their payroll taxes into a personal investment account. "The future of Social Security is dependent on creating a vehicle for private investment," Boozman said. And again in 2004, "Boozman said he likes the idea of transferring a small percentage of the federal (Social Security) trust fund to 'very safe' investments," reported the Arkansas Democrat-Gazette.
Lincoln also pointed to Boozman's statement on the "Roadmap for America’s Future," a bill from Rep. Paul Ryan, the ranking Republican on the House Budget Committee. The plan includes a proposal to allow people under 55 to steer a portion of their payroll taxes toward personal accounts, through which they can invest in funds chosen and managed by a federal government board. Asked by the Arkansas Times whether he supports the proposal, Boozman said that he "appreciates" Ryan's "commitment to putting our country on the road to fiscal responsibility." He added that the plan is not perfect, "but I think he is making a thoughtful and serious effort to prevent Congress from driving our country into financial ruin."
But even if Boozman had said that he fully supports Ryan's proposal, whether one can rightly call that or the Bush plan "privatization" of Social Security is debatable. Consider that in both cases, current retirees or those near the retirement age would not have been directly affected -- the plans are completely voluntary and only for workers under 55. One could choose to stay in the traditional government-run system and receive benefits as promised. That's important, because the term "privatization" is often used to scare seniors into thinking that their lifetime savings will be transferred into the stock market -- the same one that took a plunge in 2008 and is still recovering.
Ryan told PolitiFact in an e-mail that it would be incorrect to call even the personal retirement account portion "privatized."
"In the personal-accounts system, the accounts are owned by the individual, and managed and overseen by Social Security -- not a stockbroker or private investment firm," Ryan stated. "People choosing the reformed system select from a handful of government-regulated options -- just as Members of Congress and federal employees do."
Even Lincoln's own website says that Ryan's plan would only "partially privatize" Social Security, though not everyone agrees. An analysis of Ryan's "Roadmap" plan from the left-leaning Center of Budget and Policy Priorities, argues that, "what makes these accounts private is their ownership, not their oversight or management."
We contacted Boozman's office to get a clarification on his proposal to transfer a small percentage of the trust fund to "very safe investments." His communications director, Patrick Creamer, sent us the following statement:
"Congressman Boozman’s number one priority is making sure no benefits are cut to current and future enrollees. However, he understands the current system is unsustainable and in need of reform to ensure that future generations also receive benefits. One option he is open to is allowing younger workers to put a portion of their payroll taxes into safe investments –- but this is a decision individuals would have to make, not the government, and any proposal must have the support of the people of Arkansas to get his vote."
So let's review. Lincoln says that Boozman supports privatizing Social Security. It is true that Rep. Boozman stated on more than one occasion that he supports allowing -- not requiring -- younger workers to divert a portion of their payroll taxes into private investment accounts. But even Lincoln's website admits that such a proposal only constitutes "partial privatization." In 2004, Boozman said that he would support transferring a portion of the trust fund into private investments. We are not entirely sure what that would have entailed, but when we asked him whether he supports the government putting money into the stock market, he told us that that decision lies solely with the individual workers. In short, Lincoln's ad makes it seem as though Boozman has consistently advocated handing the entire program over to Wall Street bankers, which is a significant stretch. We rate this Barely True.
Editor's note: This statement was rated Barely True when it was published. On July 27, 2011, we changed the name for the rating to Mostly False.