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OVERHAUL OF SOCIAL SECURITY RESISTED
SENATE PANEL ENCOUNTERS DEMOCRATIC OPPOSITION

Social Security overhaul got off to a rough start Tuesday in Congress, encountering Democratic opposition and some Republican misgivings about reshaping the 70-year-old program that has eased the sting of poverty for many elderly Americans.

The Republican-controlled Senate Finance Committee began the legislative process of writing a measure to restructure Social Security, but Democrats remained solidly against any plan that would create individual personal investment accounts funded through part of the Social Security payroll tax.

As the senators debated the financial details of several proposals to alter Social Security, hundreds of opponents staged a rally near the Capitol in opposition to President Bush's personal-account plan.

"If he's going out to push for privatization, let's help him pack," Sen. Dick Durbin, D-Ill., told the cheering crowd of partisans, referring to Bush's 60-day blitz to sell his proposals to the public.

Opinion polls have shown a decline in support for personal accounts since Bush started his campaign.

Even some Republicans on the panel expressed reservations about the Bush approach, casting doubt on whether it can get through committee. Sen. Olympia Snowe, R-Maine, said she did not want to tamper with Social Security's system of guaranteed benefits. Another Republican, Sen. Craig Thomas of Wyoming, expressed reservations about the heavy borrowing that personal accounts would require.

The day's developments once again exposed the sharp partisan divide on the issue and the difficulty of reaching agreement on legislation that would deal with the system's long-term financial problems.

Sen. Charles Grassley, R-Iowa, chairman of the committee, vowed to go forward with plans to write a bill by this summer, but he expressed frustration over Democratic opposition to personal accounts.

"Those of you who are bad-mouthing every other suggestion out there, suggest your own plans," Grassley said. "Doing nothing is not an option, because doing nothing is a cut in benefits."

Despite such criticism, Democrats did not back down from their contention that partially privatizing the system is a bad idea, saying that Congress needs to work instead on proposals that would keep Social Security from going insolvent in 2041 while retaining its essential structure.

They contended that Bush has not suggested any real solvency plan, only a sketchy idea for private accounts. The president has said he would work with Congress on ways to end Social Security's future funding shortfall.

Noting that Bush's plan would allow workers to divert 4 percentage points of their 6.2 percent payroll taxes into private accounts, Sen. Max Baucus, D-Mont., said it "would dig Social Security into a deeper hole."

He said he and other Senate Democrats would shun Grassley's efforts to write a bipartisan bill until Bush publicly drops the idea of individual accounts.

Grassley, who favors personal accounts, said he would seek approval of a bill with or without Democratic support, but he admitted he may not have the votes to pass a bill in committee.

He told CNN that if he does not have the votes to approve personal-account legislation, he would push for committee approval of legislation that would make Social Security solvent.

Sen. Lindsey Graham, R-S.C., who has spoken with Democrats about a compromise, said he was convinced that Democrats were open to proposals for Social Security restructuring "so long as they didn't blow a hole in the deficit and so long as they didn't destroy the purpose of Social Security."

He said he thought that Democrats were more likely to participate in drafting an overhaul bill if forced to vote on a measure portrayed as critical to shoring up the retirement system.

The Los Angeles Times contributed to this story.

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