Governor Bush's Individual Account Proposal: Implications for Retirement Benefits

Abstract

Governor Bush has proposed allowing workers to divert part of their Social Security payroll taxes into individual accounts. He has also promised to maintain current-law Social Security benefits for disabled workers and survivors, as well as for both current retirees and workers nearing retirement. The purpose of this analysis is to examine some of the implications of fulfilling these promises while at the same time diverting payroll tax revenue from Social Security to individual accounts.