For Immediate Release
Office of the Press Secretary
June 2, 2005
President Discusses Strengthening Social Security for Rural America
Hopkinsville Christian County Conference and Convention Center
Hopkinsville, Kentucky
In Focus: Social Security
2:30 P.M. CDT
THE PRESIDENT: Thanks for the warm welcome. Please be seated.
Thanks for the warm welcome. Glad I brought a little rain with me.
(Laughter.) I'm honored to be here. I've got some friends -- just met
them, but some folks from the community here who want to discuss Social
Security with me and with you. It's a vital subject. But before I get
there, I do want to say a couple of things.
First, it's such an honor to land at Fort Campbell, Kentucky.
(Applause.) I say "honor," because that base houses some of the finest
men and women our country have ever known. (Applause.) Men and women,
and their families, who are making incredible sacrifices on behalf of
the American people. They're doing some hard work to protect the
country, and as they do that hard work, they're helping free people.
We are laying the foundations for peace because more people are free in
the world. And I want to thank those of you who support the base.
(Applause.)
Freedom is on the march. I was proud to see that Laura has a great
trip overseas. She was advancing the freedom agenda, making it clear
that free societies are societies that honor women and welcome women
into the daily lives of government and business. (Applause.) She
sends her best. She's become quite the comedian over the last couple
of weeks. (Laughter.) I love her dearly. She's a great First Lady
and a wonderful wife. (Applause.)
I appreciate knowing your Governor. I want to thank Governor
Fletcher for doing a fine job for the people of Kentucky. (Applause.)
I know Congressman Ed Whitfield is traveling, but I think he sent his
mom and dad here. Mr. and Mrs. Whitfield, thank you all for coming.
There you are. Great to see you all. (Applause.) Tell Ed I was
asking about him. (Laughter.)
I want to thank all the state and local officials who have joined
us today. I'm honored that you're here. I want to thank Mayor Liebe
for being here. I want to thank those of you who serve in the city
councils and county commissions, if that's what you call them here in
Kentucky. Thanks for serving.
I want to tell you somebody else I met who's serving in an
incredibly important way, and that is a fellow named Dr. John
Cotthoff. (Applause.) A couple of people have heard of him.
(Laughter.) He came out to the -- to meet me at Air Force One. Every
time I stop at a place, I ask somebody who has volunteered in the
community to come out so I can herald volunteerism, so I can thank this
one person in this one case for his kindness. He's a doc. He
established a clinic in 1991, the St. Luke Free Clinic. He volunteers
his time. He helps 4,000 working uninsured people get health care.
He's an -- he's a soldier in the army of compassion. He's one of the
millions of citizens in this country who have heard the universal call
to love a neighbor just like you'd like to be loved yourself and are
helping this country, one person at a time.
If you're a member of the army of compassion, I want to thank you
for joining John. If you want to serve our country, feed the hungry,
find shelter for the homeless, love somebody, teach somebody to read,
and you'll be making a huge contribution to America just like Dr. John
Cutthoff is. John, thank you for being here. I appreciate you
coming. (Applause.) Thank you, sir.
We got a lot to do in Washington, D.C., and there's too much
politics up there. (Laughter.) Pure and simple. I'm calling on
Congress to do a couple of important things. One of them is to make
sure we're wise about how we spend your money. If the program doesn't
wok we ought not to be spending money on it. (Applause.)
I submitted a tough budget. Congress passed a tough budget and now
it's time for them to make sure they don't overspend when it comes time
to appropriating your money. (Applause.) We've got a plan to cut our
deficit in half in five years, and if they're wise stewards with your
money, we will do that.
Secondly, four years ago I submitted a strategy to the United
States Congress to make us less dependent on foreign sources of
energy. And we've had four years of debate. This is the year where
they've got to stop debating an energy bill and pass an energy bill
that will encourage conservation -- (applause) -- a bill that will
encourage conservation, a bill that will modernize the electricity
grid, a bill that will spend money on clean coal technology -- we've
got a lot of coal in America; we could use technology to make sure we
burn it cleanly. We've got to explore for oil and gas in
environmentally friendly ways. We've got to spend money to use ethanol
-- so we can use ethanol and biodiesel. (Applause.) We've got a plan
that will make us less dependent on foreign sources of energy.
Listen, I understand people are paying higher prices at the gas
pump. I know that you're paying that tax -- it's like a tax that goes
-- that money, and it's up because we're dependent. And the more
dependent you are on somebody else's energy, the more likely it is
you'll pay a higher price for it. And so I put a plan up there to get
us to diversify away from the old habits and the old ways. The bill
passed the House, it passed the Senate committee. It's now on the
floor of the United States Senate. For the sake of economic security
and national security, the Senate has got to get that bill passed; the
House and Senate have got to reconcile their differences and get me a
bill I can sign by August of this year. (Applause.)
I want to talk about Social Security. Franklin Roosevelt did a
smart thing when he set up the Social Security system. There's a lot
of people who depend upon their Social Security check. I suspect
there's a lot of people in this part of the world that depend on that
check. I want to start off by telling those of you in Kentucky who get
a check now from Social Security, nothing is going to change for you.
You're going to keep getting your check. I don't care what the
politicians say. I don't care what the advertisers say, I don't care
what the pamphleteers say, nothing changes for you.
When you hear us talking about the Social Security system being in
trouble, people who are getting their check have got to understand
you're in good shape. It's the youngsters coming up who have a problem
with Social Security. And I'll tell you why -- (applause) -- let me
tell you why. A lot of us are getting ready to retire. We're called
baby boomers. See, my retirement age happens to be in 2008. I reached
retirement age in 2008, which is a convenient year for me to retire.
(Laughter.) And there's a lot of baby boomers, and we're living longer
than the previous generation. So you're beginning to get a sense of
the new math. Baby boomers -- I think when we fully retire, it's going
to be about 73 million of us that the younger people are going to have
to pay for. Right now there's over -- a little over 40 million
retirees. So there's a whole lot of new retirees getting ready to
retire soon who are living longer, which means younger folks are going
to keep paying into -- paying for us longer and longer. And we've been promised greater benefits.
To complicate the problem for the younger generation of Americans,
there are fewer people paying into the system for every retiree. In
1950, there were about 16 workers for every retiree. Think about
that. So if the government made a promise, there was 16 of you that
were able to divide up the promise. Today, there are 3.3 workers per
retiree. Pretty soon there will be two workers per retiree. You got a
lot of people getting ready to retire who will be living longer,
drawing greater benefits, with fewer people paying in the system.
And we're paying into what's called a pay-as-you-go system. Now,
that means you pay through payroll taxes, and we go ahead and spend.
(Laughter.) We, of course, spend on retirement benefits. But that's
not all that Congress has been spending your payroll tax on. See, a
lot of people think they're sending their payroll taxes in and the
government holds the money for them, and when it comes to retire, you
get your money back. That's now how it works.
People are paying their payroll taxes; the beneficiaries are
receiving their benefits, and there's been money left over. And that
money has gone to government programs. And so all that's left in the
Social Security trust is a file cabinet full of IOUs. And when those
IOUs come due, somebody has to pay for them either through reduced
benefits or greater taxes.
The pay-as-you-go system is -- really isn't fair, if you think
about it. The government has said you're going to pay payroll taxes
for your retirement, but they've gone ahead and spent your money on
other government programs. And as a result of the pay-as-you-go
system, with more people retiring, in 2017, the system goes into the
red. In other words, more benefits will be going out than payroll
taxes coming in. That makes sense. If you got fewer people paying in
and more people retired, pretty soon it's going to catch up with you.
And it does in 2017.
That's not very far down the road. If you've got a six-year-old
child, that's -- the system goes in the red when you're child starts to
drive. That is if you -- you have driver's licenses at 18 here,
Ernie? Yes, 18. It was harrowing experience when our daughters -- 16,
well, that's interesting, yes. (Laughter.) Let me know when they're
on the road. (Laughter.)
And every year thereafter the system gets worse, because more
people are getting benefits and they're living longer. In 2027, the
amount of money coming in will be $200 billion less than the amount of
money going out. Every year it gets worse from 2017 on. In 2032, I
think it is, $300 billion a year. In other words, we're piling up an
unsustainable system for younger workers. You got younger workers
paying into a system that is going to go bankrupt in 2041, unless we do
something about it.
So I saw a problem. If you take an objective look at the math, you
can't help but see a problem. It's no problem for people who are
getting their check today. If you're getting your Social Security here
in Kentucky, you don't have a problem. But if you've got a grandchild,
you do a problem -- or at least that grandchild does. And so I decided
to put the issue up for discussion in Washington. I'll tell you why I
did. The job of the President is to confront problems, is to deal with
problems, not pass them on to future Presidents or future congresses.
That's the job of the President of the United States. (Applause.)
I suspect some in Washington wish I hadn't have brought it up,
because some in Washington really don't want to deal with it. But
every year we wait, we're saddling a younger generation with about $600
billion in costs. I mean, it's conceivable if we don't do anything
that the payroll tax will have to go to 18 percent in order to make --
fulfill the promises for the baby boomers. And I don't think that's
fair to a younger generation of Americans, to not have political
courage and deal with the problem and pass on the problem to them. I
just don't think it's right.
And so I've been traveling the country, spending a lot of time
trying to impress the folks with two things right off the bat. One, we
have got a serious problem, and if we don't do anything about it, we're
saddling a young generation with a huge problem. And, two, if you get
your check, nothing is going to change. I keep saying that because I
understand the politics of Social Security -- if you don't want to get
anything done, all you've got to do is go around the country trying to
scare seniors. And then the seniors will say to the members of the
Congress, please don't do anything. And so I'm going to spend a lot of
time convincing seniors nothing changes -- and convincing folks there's
a problem, because once the people realize there's a problem, then the
next question they ask to their elected representative is, we've got a
problem and I've sent you up to Washington to solve problems, and so
what are you going to do about it? See, instead of just sitting up
there, why don't you work with the Preside
I also have a duty to lay out some ideas, and so I have done so. I
have -- I have suggested the following principles: one, that future
generations should receive benefits equal to or greater than the
benefits enjoyed by today's seniors. That makes sense to say to
somebody who's paying in the payroll tax. If you're a youngster,
you're paying in, the system ought to at least yield benefits equal to
or greater than the baby boomers, for example.
Secondly, I believe the system -- I know the system can be designed
so that someone who works all their life does not retire into poverty.
That seems to make sense. You got a lot of people working hard in
America and they're contributing to the Social Security system, and
when they retire, they retire into poverty. To me, that's a system
that is a flawed system. And so, therefore, I supported an idea,
what's called progressive indexing. That's long Washington words for
this: Right now benefits rise at the rate of wage increases. And so I
proposed that the poor Americans, those at the lower end of the income
scale, have their benefits continue to rise with wages; and that the
upper-income folks have their benefits rise with inflation. In other
words, all benefits go up, one set of benefits faster than others.
And if we're able to implement that plan, that solves a significant
portion of the solvency issue for Social Security. Just think about
that. By slowing down the rate of benefit growth -- benefits still
grow, but at a slower rate, a rate in which government can now afford,
a younger generation can afford to pay in, at a slower rate -- we solve
a lot of the Social Security problem.
And so I put that on the table for people to consider. To me, it
makes sense. To me, it's fair. Benefits go up; certain people's
benefits will go up faster than others, depending upon their income
level.
And so, then there's other options on the table that Congress needs
to come and talk about. In good faith, they need to come -- set aside
their political party and say, for the good of the country, why don't
we come together and solve a significant problem.
I want to talk about one other idea that we're going to spend some
time talking about today. In order to make Social Security a better
deal for younger Americans -- in other words, what I've just laid out
is a way to permanently solve the issue. But I think we ought to make
it -- without raising taxes, by the way, without raising payroll taxes,
which is important. (Applause.) I think we ought to let younger
workers, if they decide -- if they say, this is something I'd like to
do -- is to take some of their own money that they're paying into the
system through the payroll tax and set that money aside in a voluntary
personal savings account.
Let me tell you why it will be a better deal -- and we're going to
spend some time talking about this -- money grows over time. You hold
money and you get a decent rate of return on that money, it tends to
compound, it grows, the growth accelerates. That's just how it works.
It's called the compounding rate of interest. Right now, when we
collect your money, if you're a youngster out there working hard and
paying into the system, you'll be displeased to know you get about a
1.8 percent return on your money, which is pitiful, rate of return.
Heck, you can put your money in T-bills and do better than that.
I think we ought to allow younger workers to take some of their own
payroll taxes -- remember, it's your money, and not the government's --
and set it aside, and be able to invest in a conservative mix of bonds
and stocks, if that's what you choose to do. I recognize some people,
that makes them nervous in America. You don't have to do it. It's a
voluntary idea. In other works, you say, here's your option, if this
is what you think makes sense. A conservative mix of bonds and stocks,
for example, can yield over a period of time 4.5 percent rate of
return. And that difference between the 4.5 percent somebody gets or
the 1.8 percent you're now getting over a 30-year period is a lot of
money. It's a lot of money.
And so, when I say better deal, it's a better deal for somebody to
earn better interest on their own money. That makes sense. I mean, we
tried it before, by the way. As a matter of fact, we're trying it
now. This may interest you. This was such a good idea that members of
the United States Senate and the United States Congress decided that in
the federal retirement system, called the Thrift Savings Plan, that
people, if they so choose, ought to be allowed to set aside some of
their own money to get a better rate of return on their money. So
here's my attitude and my message to the people in Washington, D.C. If
you let yourself do it, if you think it's such a good idea for you,
who's been elected to the Congress, then you ought to let workers have
that same option. (Applause.)
The personal savings account, the voluntary personal savings
account would be a supplement to your Social Security check. It would
be a part of a Social Security system, it's not "the" Social Security
system. The government is going to say you can't put all your payroll
tax, you can put a portion of your payroll taxes, and so you'll end up
with something in the Social Security system, as well as your own nest
egg that the government cannot take away. It's your own nest egg that
the government can't spend on other government programs. It's your
money. (Applause.)
If you're a 20-year-old making $8 an hour over your career -- 20
years old today, $8 an hour over your career, and if the government
lets you put a third of your payroll taxes in a voluntary personal
savings account, you'll end up with a nest egg of $100,000 when you're
63. If you're a police officer and a nurse, who started working in
2011 and you work your entire careers, when you retire both of you will
have a combined nest egg of $669,000 as part of your retirement
package. That's how money grows.
I think it makes sense to let people, if they so choose, have an
asset they call their own. It's beneficial for society. One of the
things I've tried to do as the President is promote an ownership
society. We want more people owning their own assets. We want more
people owning their own home. We want to encourage entrepreneurship,
so people can own their own small business. I think it makes sense to
have people from all walks of life owning and managing their own
assets, if that's what they choose to do. I reject the idea, soundly
reject the idea that the investor class, the so-called investor class
should be the only owners in America. I think ownership ought to be
spread to every corner of America, for people of all walks of life, no
matter what their demographic background may be, or no matter what
their income level is. I like the idea of moms and dads being able to
pass on assets to whomever they choose. (Applause.)
A couple of other things -- I'm getting a little windy, aren't I?
(Laughter.) Thank you. She said I'm on a roll. (Laughter and
applause.)
Just a couple of other points I want to make; then we'll go to some
of our guests here -- not "some of our guests," all of our guests.
First of all, there are rules. In other words, people say to me, well,
you know, what happens if somebody makes a risky investment? The idea
of having a voluntary personal savings account does not allow for --
you can't take your money to the lottery, or the track. (Laughter.)
There's a conservative mix of bonds and stocks.
By the way, this happens all the time in our society where people
are given some options in a rather conservative mix. It doesn't take
much to get a better rate of return than government gets for you now.
I was with John McCain at one of these events one time; he said he
thought -- as he remembered, he got about a 7 percent rate of return on
the conservative mix of bonds and stocks that he has held for about
20-some years. You put 7 percent onto a pretty good size of money,
that grows rather quickly. And it's your money.
And so there will be rules. People say to me, well, Wall Street
will benefit. No, we're not going to let Wall Street gouge people on
this. I mean, that's just not going to happen. There will be a --
there will be reasonable fees. And, of course, the government will
have an oversight role in all this business. It will be an opportunity
for people if they so choose.
Let me tell you one other thing to -- that I think you'll find
patently unfair about this system. You got a husband and a wife, and
they've worked all their life, both contributing into the Social
Security, and the husband passes away. And the wife will then be in a
position to either have her own benefits, or her husband's benefits,
but not both. In other words, somebody has been working -- the spouse
has been working and one dies early, and both of them had been working
all their life -- think about this system -- when it comes time to
retire, the surviving spouse -- man or woman -- gets to choose his or
her benefits, or the deceased spouse's benefits, which is ever higher,
but not both. That means somebody has worked all their life and put
money into the system that at some point in time just goes away.
And these are hard working people we're talking about in America --
people who have worked hard and paid that payroll tax. And if you're a
youngster who just entered the work force, you know what it means to
give some payroll tax. That's that first shock you get when you see
that payroll tax coming out of your check. Imagine a system where
you've worked all your life and it's not there. And so one of the
reasons -- another reason I like somebody to be able to have assets
that they can pass on to whomever they choose, here's an instance --
the example I just gave you says that a husband or a wife will have an
asset base upon death to be able to pass on to the surviving spouse to
help them out during this incredibly difficult period.
And so Congress needs to consider this idea. And I repeat, if it's
good enough for you in the Congress, it ought to be good enough for
working people here in America. (Applause.)
Rick Paxton. Welcome, Rick, thank you. Where do you live?
MR. PAXTON: Yes, sir, I live right here in Hopkinsville , Kentucky
here.
THE PRESIDENT: Good place to live, isn't it?
MR. PAXTON: It's a wonderful place to live. (Applause.)
THE PRESIDENT: Thanks for coming. Tell everybody what you do.
MR. PAXTON: I'm a financial consultant with Hilliard-Lyons, have
been for the last 15 years.
THE PRESIDENT: Good. I ask -- on these panels I always ask
somebody who -- to come who knows what he or she is talking about, an
expert.
MR. PAXTON: Uh-oh. (Laughter.)
THE PRESIDENT: Usually it's a PhD. I know you're not one. And I
-- (laughter) -- and I like to tell people, he's a PhD. I'm a C
student -- was a C student -- and look who the advisor is.
(Laughter.) So all you C students out there, work hard, but there's
hope for you. (Laughter and applause.)
All right, Rick. Rick studies markets and investments. Let her
rip.
MR. PAXTON: Yes, sir. Well, first, I have with me today my wife,
Anne, and my two wonderful children, Chris and Elizabeth.
THE PRESIDENT: Well, good. Welcome.
MR. PAXTON: And on behalf of my children, I just want to thank you
for being brave enough to take this on. I know it's politically been a
thing that's been talked about. I can remember 30 years ago in a
college economics class, the professor talking about the coming problem
because of our generation, the baby boomers.
THE PRESIDENT: Yes.
MR. PAXTON: And I just want to commend you for taking this on.
THE PRESIDENT: Well, thanks Rick. You're kind to say that, thank
you. (Applause.) That's what you're paying me to do. Go ahead.
* * * * *
THE PRESIDENT: That's interesting. I hope everybody understands
what he's saying. If you keep your money and it grows, it tends to --
it accelerates, it snowballs, I guess. It's not a very sophisticated
terminology, I recognize --
Q That's very good.
THE PRESIDENT: Thank you. Well, I did pay attention to some
courses. (Laughter.) Anyway, but it grows.
You told me an interesting story about some of the seminars you
conduct.
Q Yes, sir. One of the jobs that I have is to go into companies
and work on the retirement plans with them. And we address rooms of
people who are planning for their retirement and enrolling in the
retirement plan. For 15 years I've been doing this, and the first
question I ask them, and have for 15 years, "Is there anybody in this
room who thinks that they'll be able to depend on their Social Security
when they get there? Do you think it will be there for you in
retirement?" And in 15 years, I've never had a hand go up.
THE PRESIDENT: Interesting, isn't it? Think about a government
that has this program where we're taking a lot of money out of your
pocket. And he goes in a room and says, anybody think they're going to
see a check -- these are younger workers he's talking to -- or think
the system will be there for them? And they don't raise their hand.
What are the -- government must build trust. And one way you build
trust is you say that when you put money into something you're going to
get something out of it. Now, if you're an older American, you're in
good shape. But the dynamics have shifted. And what the amazing thing
is, a lot of youngsters understand what he's talking about; they're
beginning to see the realities of a Social Security system that is not
solvent for them. It's solvent for their dads and granddads and
grandmoms; it's not solvent for them.
You know, they tell me -- somebody told me about a survey one time
where the youngsters said they're more likely to see a UFO than a
Social Security check. (Laughter.) It's got to be a little
disheartening if you're a person who believes you're more likely to see
a UFO than get a Social Security check and you're paying into the
system, hoping that the system is available for you. And that's why I
keep trying to explain to people -- or do explain to people, this is a
generational issue. Grandmoms and granddads ought to be worried about
their grandchildren coming up and putting money in a system that's not
going to be available for them. (Applause.)
What else you got? I've got a question for you. I've got an
interesting -- you know what's interesting about our society -- and
there is some concern, I readily understand that people are nervous
about maybe investing their money, particularly older Americans that
aren't used to it. But think about what's taking place in society
today -- 401(k)s. You look like kind of an older fellow -- were you
aware of a 401(k) when you were 20 years old?
MR. PAXTON: I wish they were around then.
THE PRESIDENT: Yes, 401(k)s are investment vehicles for workers to
watch their own money grow. It's part of retirement. A lot of people
have them. I was in an automobile factory in Mississippi, talking to
line workers. I said, how many of you all invest your -- watch your
own money grow and make investment decisions for your money through a
401(k) plan in this plant? I'm telling you, hands went up -- a lot of
hands, people from all walks of life. The culture is changing -- we've
got investors now all across America, people from all walks of life
learning to invest. IRAs -- I'm sure you're spending a lot of time on
that.
MR. PAXTON: Sure.
THE PRESIDENT: So when you hear people say, well, I'm not so sure
if America is ready for this, two things come to my mind. One, a lot
of Americans already are watching their own money grow. And, two, you
can learn pretty quick when you're watching your own money. You know
what I'm saying? You ask a lot of questions when it's your money, and
you learn really fast.
And so, Rick, thank you for coming, I appreciate it.
MR. PAXTON: You're welcome, sir. Thank you for inviting me.
THE PRESIDENT: We've got Clay Walton. Speaking about younger -- I
don't know about UFOs and Social Security checks; I do know you're a
farmer. Isn't that right?
MR. WALTON: That's right.
THE PRESIDENT: Well, say something, then. (Laughter.)
MR. WALTON: That's correct.
THE PRESIDENT: Okay. What do you farm?
MR. WALTON: I'm from here in Hopkinsville.
THE PRESIDENT: Like what crops?
MR. WALTON: I grow alfalfa hay.
THE PRESIDENT: Very good. Is the market all right? I shouldn't
have asked that -- it's never all right if you're a farmer, is it?
MR. WALTON: You can buy some, if you want. (Laughter.)
THE PRESIDENT: Take it back to Crawford. (Laughter.)
So tell me, has this family farm been around for a while?
MR. WALTON: Yes, sir, it sure has.
THE PRESIDENT: Good.
MR. WALTON: My father and my grandfather and even my
great-grandfather.
THE PRESIDENT: Really? Which brings up another subject. We've
got to get rid of the death tax forever. (Applause.) We want to keep
this asset in this man's family. Talk about passing assets from one
generation to the next, farmers are pretty good about that. It doesn't
make sense to tax a person's assets twice -- when you're living and
then when you die.
Anyway, sorry to interrupt, just a thought that popped into my
head. (Laughter.) Happens occasionally. (Laughter and applause.)
What's your concerns on Social Security?
MR. WALTON: Well, my concern is, being a farmer, Social Security
is really the only thing I have. Nobody offered me a 401(k), or
anything when I started farming. And I'm paying into it all these
years and I'm really counting on it, and I would kind of like it to be
there when I retire.
THE PRESIDENT: Interesting, isn't it -- here's a sole proprietor,
kind of a man out there on his own and he's paying into the system and
sounds like to me -- I don't want to put words in your mouth, but it
sounds like you might be a little nervous about whether it's going to
be there.
MR. WALTON: Oh, absolutely.
THE PRESIDENT: Congress has got to understand you've got a
29-year-old farmer working hard, putting money in the system -- He's
sitting right up here in front of all these cameras saying, I'm not so
sure the system is going to be there for me. That's the problem. And
that's the problem that I'm going to spend whatever time is necessary
talking about to get the folks up there to get something done on behalf
of this good man. (Applause.) He works hard enough to have to [sic]
worry about whether or not Congress can do the right thing with his
money.
What else you got?
MR. WALTON: I have a new wife.
THE PRESIDENT: Well, that's a good move. (Laughter.) That's the
smartest thing you did. (Laughter.) Good, I'm looking forward to
meeting her.
MR. WALTON: All right.
THE PRESIDENT: Have you ever thought about the personal accounts,
at all? Has that thought ever --
MR. WALTON: Oh, I think that's a very good idea. I mean, you
know, anybody that's just giving their money away, they -- you know,
having choices and options for a little bit of our money seems
reasonable to me.
THE PRESIDENT: Yes, seems like it to me. I mean, what's wrong
with government saying, if you so choose? I recognize that's maybe a
little different philosophy than some have in Washington. But it says,
we trust you. After all, who should government trust? Government
ought to trust the people. That's how this government is formed.
That's the strength of our country, is trusting people. And, after
all, we're trusting you with your own money. You said you're working
hard, you're paying in the system. I just want you to recognize -- I
recognize whose money it is. It's not the government's, it's yours.
You're doing fine. (Applause.) Is it raining enough for you?
MR. WALTON: Growing a little bit more now.
THE PRESIDENT: That's good. All right, Erica. Good job. When
were you married, by the way?
MR. WALTON: A little over six months ago.
THE PRESIDENT: Should have invited me. (Laughter.) Never too
late, get a couple of matchbooks or something. (Laughter.)
Erica Campbell -- thank you, good job. Erica, welcome.
MS. CAMPBELL: Hello.
THE PRESIDENT: What do you do?
MS. CAMPBELL: I'm a full-time nursing student and part-time
medical assistant at OB/GYN Associates.
THE PRESIDENT: Awesome. Need a little medical liability reform in
Washington, D.C., by the way, to keep these OB/GYNs in practice.
(Applause.)
MS. CAMPBELL: Yes, we do.
THE PRESIDENT: You've also got a -- your most important job,
however, is --
MS. CAMPBELL: I'm a mother.
THE PRESIDENT: There you go.
MS. CAMPBELL: I have a four-year-old daughter named Kyler.
THE PRESIDENT: Fantastic. Is she here?
MS. CAMPBELL: She's right over there. Hi, Kyler.
THE PRESIDENT: Sound asleep.
MS. CAMPBELL: Asleep? Okay.
THE PRESIDENT: Laura told me not to talk too much -- I put her
asleep, didn't I? (Laughter.) This is -- I love this story by the
way. Here's a single mom, working hard, working a job -- two jobs --
mom, first; a -- what did you say you were, a OB/GYN?
MS. CAMPBELL: A medical assistant.
THE PRESIDENT: Medical assistant.
MS. CAMPBELL: And a full-time nursing student.
THE PRESIDENT: Now going -- a student, becoming a student. That's
great. I appreciate you doing that. It's -- you're doing your duty.
Now, here you are talking about Social Security. Tell -- give me some
thoughts.
* * * * *
THE PRESIDENT: Let me stop you right there real quick. Isn't it
interesting -- a mom sitting here talking about a 401(k) or an IRA.
These are investment vehicles that encourage people to save their own
money.
Now, tell me what it's like on a 401(k). I mean, do you get a
monthly statement, quarterly statement?
MS. CAMPBELL: We get -- it seems like every day we piece of paper
from it. (Laughter.) But it's like every two weeks --
THE PRESIDENT: Oh, that's good.
MS. CAMPBELL: -- I think we get a statement from it. It's taken
out of my paycheck before I ever see it, so I don't miss it, and it's
right there and I can keep up with it.
THE PRESIDENT: And you get to look at it.
MS. CAMPBELL: It's actually through Hilliard-Lyon.
THE PRESIDENT: That's good. Doesn't it make sense to have a
society in which people are constantly reminded about growth of their
assets? It seems like to me it would cause people to pay pretty close
attention to what the government's decision-making process is like. I
mean, here's a young woman who opens up on a bimonthly basis her
statement, reminding her that she owns that. That's part of an
ownership society.
Keep going. (Laughter.)
* * * * *
THE PRESIDENT: This is what we're talking about. We're talking
about giving a worker, a fellow American, the opportunity -- if she so
chooses -- to take some of her own money, watch it grow just like she's
doing in a 401(k), building up a nest egg, an asset base which will
give her peace of mind. In other words, an asset that she can pass on
to her young daughter.
Now, this asset will grow over time as we talked about, the
interest compounds at a reasonable enough rate, it grows. And I just
-- I cannot believe that people in Washington, D.C. are -- don't
understand the power of this idea for a person like Erica, and wouldn't
be willing to give Erica the opportunity, if she chooses -- her choice
-- to set aside some of her own money, just like she just said she
wants to do.
And -- is it hard to invest? I mean, do people -- I hear people
say, well, it may be too difficult.
MS. CAMPBELL: I did it. I didn't think it was too hard. I'm not
a rocket scientist, but whenever you sign up for your job they just set
it down and explain it to you right then and you sign up for it, and
you don't have to do anything else if you don't want to.
THE PRESIDENT: See, there's plenty of help. And you've got
advisors, people who are going to -- and these 401(k) plans, for
example -- and I'm -- there will be a whole group of people that will
be available to give people reasonable advice about what to do with
their own money. And it's really important for our fellow citizens to
understand it doesn't take much to get a better rate of return than the
government is getting for you now. And that differential makes a huge
difference for future savings for our fellow citizens.
Erica, thank you. Looking forward to meeting Kyler.
MS. CAMPBELL: Thank you.
THE PRESIDENT: We better not wake her up yet, though, right?
MS. CAMPBELL: We're waking her up for the picture. (Laughter.)
THE PRESIDENT: Yes, okay, good. (Applause.) Thanks for coming.
Lindsay Freeman. Lindsay, right here from Hopkinsville?
MR. FREEMAN: Right here in Hopkinsville, 68 years.
THE PRESIDENT: Really, and that's how old you are?
MR. FREEMAN: Yes, sir. (Laughter.)
THE PRESIDENT: So, therefore, you were born here.
MR. FREEMAN: Yes, sir.
THE PRESIDENT: And you were a major general?
MR. FREEMAN: I retired from the Army Reserve as a major general,
yes.
THE PRESIDENT: Thanks for serving. Good job. (Applause.) You
get -- you're eligible for Social Security?
MR. FREEMAN: Yes, sir.
THE PRESIDENT: Are you getting it?
MR. FREEMAN: That's a big part of my income today, is my Social
Security.
THE PRESIDENT: A lot of people like Lindsay in America -- "a big
part of my income," how I live my life depends upon the Social Security
check. And there's thousands and thousands of people like Lindsay.
They're saying, I need my check, Mr. President. Don't take it away
from me. Don't mess with it. And he doesn't have to worry about it.
I hope -- I hope that message has sunk in.
MR. FREEMAN: Well, I'm not worried about it for me, but I'm
worried about it for my daughter who is out here, Elizabeth. And she
works for the drug court. And we're worried about it for my son who is
an equine veterinarian out in Utah.
THE PRESIDENT: Really. That's good. That's what I'm hearing a
lot more of, by the way. Once we've convinced seniors there's nothing
to worry about, then they're starting to say, well, Mr. President, I'm
not worried about me, but what are you -- what do you all intend to do
in Washington about my children or my grandchildren?
This is -- folks, this is a generational issue we're talking
about. This is an issue that really does relate to a younger
generation of Americans who are just starting in the work force and
coming up.
What else you got on your mind?
MR. FREEMAN: Well, I need to introduce my wife, Nancy, who is a
former schoolteacher, is here. And she's the one in the wheelchair
over there with the broken leg. And then my daughter's friend, Kenneth
Stoll (phonetic) is a firefighter --
THE PRESIDENT: Fantastic.
MR. FREEMAN: And then my sister-in-law, TC Freeman, works for
Senator Bunning. So we have --
THE PRESIDENT: Yes, well -- fortunately, you don't have a large
family; otherwise we'd still be -- (laughter and applause.)
Let me say something about your wife. First of all, thanks for
being a schoolteacher. One great way to serve our nation is to teach
school. And it's a wonderful profession. (Applause.)
MR. FREEMAN: Well, I worked in a family business for almost 50
years, and of course, I paid self-employment tax for all those years.
And I just wish that I'd have had an opportunity to invest some of my
own money 50 years ago. And I would have invested it in a real safe
mutual fund. And based on Rick's statistics, I'd have been a
millionaire.
THE PRESIDENT: That's right. Well, he's not kidding, though. You
put enough money aside and you hold it long enough, and you get a
decent rate of return, money grows. That's what people have got to
understand. We're missing that opportunity in America. One way to
make this system work better, a better deal for people who are putting
hard-earned money is just give them a chance to watch their money grow
in a conservative mix. And that's what you're talking about.
I appreciate you reminding people of that. I'm also beginning to
hear more people saying, I wish I'd have put a little something aside,
or had the opportunity if I so choose to put money aside. And that's
all we're saying. We're saying, if you want to, you can put it aside.
The government is not saying, you have to. We're saying, you ought to
be able to -- which seems reasonable. After all, they get to.
What else you got, General?
MR. FREEMAN: Well, I still work part-time for BMAR Associates,
which is located here in Hopkinsville, and Terry Hanby is the
President, and he has about 1,400 employees. And he really pushes your
Social Security program, I'll tell you.
THE PRESIDENT: Well, I appreciate that. Tell him, thanks.
(Applause.)
You know, one of the interesting things that Lindsay said, there
are a lot of businesspeople who contribute 12.4 percent into the Social
Security -- a lot of sole proprietors. They pay the whole deal. You
know workers pay 6.2 percent, but if you're self-employed, you're
liable to pay 12.4 percent, which doubles the pain if you're a young
self-employed person, when you think nothing is going to be there.
And so we're really dealing with an issue that not only relates to
a person being able to retire -- in other words, listen, Social
Security has been a safety net -- let's put it that way -- and there's
a big hole in the safety net for a younger group of Americans, and
we're trying to bind that hole up.
But we're also giving people a chance to pass on assets from one
generation to the next. That's what a free society is all about, isn't
it? People work hard, they benefit from the freedom of America, and
then they're able to pass something on to the next generation, if
that's what they choose to do. To me, that brings stability to our
society. It's an incentive; it gives people peace of mind. It gives a
young mom peace of mind.
We've got an interesting person with us here. That would be you.
(Laughter.) Cecil Ferrell.
MRS. FERRELL: Right.
THE PRESIDENT: Microphone -- I'm a little hesitant to tell her
anything after that -- she reminds me of my mother a little bit.
(Laughter.)
MRS. FERRELL: I thought I was just supposed to hold it, I didn't
know I was supposed to talk in it. (Laughter.)
THE PRESIDENT: Well, we're trying to get some wisdom from you.
I'm really hungry. (Laughter.)
MRS. FERRELL: You are?
THE PRESIDENT: Can you help me out?
MRS. FERRELL: Well, I tell you, the only thing is to bring you a
hamburger. (Laughter.)
THE PRESIDENT: That's it. Cecil Ferrell was one of the founders
and owners of Ferrell Hamburgers. When did you all start the deal --
start your business? (Applause.)
MRS. FERRELL: We started in Owensboro in 1929. We had two places
there. My husband and his four brothers were all in together. And so
when they built the one in Hopkinsville, David and I moved down here
and took over. So we've been here for 69 years.
THE PRESIDENT: Whew, that's a lot of burgers. (Applause.)
MRS. FERRELL: That's right. A lot of water under the bridge. A
lot of water under the bridge. (Laughter.)
THE PRESIDENT: That's right, a lot of water under the bridge.
MRS. FERRELL: I have -- my husband died in 2001, and my daughter
died in 2002 --
THE PRESIDENT: You've had a tough go.
MRS. FERRELL: My son is here. He --
THE PRESIDENT: Where is he?
MRS. FERRELL: He's over here, Phillip.
THE PRESIDENT: Are you still telling him what to do? (Laughter.)
MRS. FERRELL: No, you don't tell him anything. (Laughter and
applause.)
THE PRESIDENT: You're doing good.
MRS. FERRELL: His wife is with him, Carolyn; and one of my
grandsons, David, lives in Bowling Green. He drove down.
THE PRESIDENT: That's good. You have a family reunion.
MRS. FERRELL: Just to see you.
THE PRESIDENT: Just to see you! (Laughter.) I take it you're
eligible for Social Security?
MRS. FERRELL: Well, I'm getting that way. (Laughter.) I'm 86
years old. I go to work every morning at 4:00 a.m. (Applause.) How
about that?
THE PRESIDENT: You're doing good.
MRS. FERRELL: I stay there usually around 12 hours a day. On
Monday, I go in at 3:00 a.m. and I stay for about 12 hours. So that's
a pretty full life.
THE PRESIDENT: I'd say so. See if we can kind of tack back toward
Social Security here. (Laughter.)
MRS. FERRELL: Okay. Well, I draw --
THE PRESIDENT: Are you getting a check?
MRS. FERRELL: I draw my husband's Social Security.
THE PRESIDENT: Right, you draw the --
MRS. FERRELL: Mine, I wasn't getting anything, so -- (laughter.)
THE PRESIDENT: Remember what I told you? She had a choice, the
higher of the two. So the payroll tax you put in there just, poof,
just went away.
MRS. FERRELL: Yes, it just went the way of the balloon.
THE PRESIDENT: Yes, it went in to pay for some of those government
programs in the pay-as-you-go system.
MRS. FERRELL: Right.
THE PRESIDENT: And you're getting a check. Any doubt you'll get a
check?
MRS. FERRELL: No, I don't have any doubt. And I think that --
THE PRESIDENT: That's good to hear.
MRS. FERRELL: -- I think the system that you're working up is going
to work if people will just get with it and hang in there with you.
THE PRESIDENT: I think it will. I appreciate you saying that.
(Applause.)
MRS. FERRELL: Is my face red?
THE PRESIDENT: No, not at all. You're doing good. (Laughter.)
You know what the problem is in Washington?
MRS. FERRELL: What?
THE PRESIDENT: There is kind of a zero-sum attitude. See, if we
do this, so-and-so might look good; or such-and-such party might
benefit; and, therefore, let's do nothing. It's not the right
attitude, you know that?
MRS. FERRELL: No.
THE PRESIDENT: This country expects better out of the elected
officials. (Applause.) Don't you?
MRS. FERRELL: People have to learn how to work together.
THE PRESIDENT: Well, that's right. And my attitude is this -- the
President's job is to lay the problem out. I've done so here today; I
will continue doing so around the country. I'm heading down to
Crawford, but after that I'm going to head back out again, and I'm
going to spend time talking about Social Security every week until
something gets done -- because that's my job. And my job also is to
remind people of both political parties that there's a time to set all
that business aside and focus on what's good for the American people.
(Applause.)
And what's good for the American people is to hear the truth. The
truth is we've got a problem. The truth is people who have retired are
going to get their checks, they have nothing to worry about. And the
truth is they've got a younger generation of Americans coming up that
are going to be paying into the payroll -- paying through payroll tax
into the Social Security system, into a system that's going to be
bankrupt in 2041.
And now is the time. Now is the time for people to come together.
And when they do there will be plenty of credit to go around -- plenty
of credit for whoever is willing to come to that table and do what's
right for the American people.
I want to thank you all for joining us. I want to thank you all
for coming out today on a rainy day to say hello. I appreciate you
giving me a chance to come and explain one of the really vital issues
for the United States, an issue that will affect generations of
Americans to come. We're going to get something done, folks. You know
why? Because when it's all said and done, the American people are
going to rise up and say, solve this problem, then you can go on to the
next. (Applause.)
Thanks for coming. God bless. (Applause.)
END 3:22 P.M. CDT
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