WASHINGTON - President Bush left some of the balance out of the balance sheet when he talked about retirement savings in his State of the Union speech.
The president told younger workers they can expect higher retirement returns if they divert some of their payroll taxes into private accounts under his proposal. He didn't tell them they can expect a lower Social Security check too.
A variety of telling details went unspoken in the policy-thick address, on jobs, Iraq, terrorism and more.
In a portion of his speech dealing with economic progress in the past four years, Bush trumpeted the addition of 2.3 million jobs "in the last year alone," as if he's delivered a succession of job gains.
His number was correct for the year in question, but he left out that there was an overall job loss in those four years. He remains about 300,000 jobs short of closing that jobs deficit.
Bush called Iraq "free and sovereign," an arguably premature definition in light of the continuing violence from insurgents and the overwhelming presence of U.S. troops.
The president touted global support for the Iraq war, saying 28 countries have troops on the ground. However, most troops come from the United States and Britain, 90 percent of coalition troop deaths have been American, and several nations have indicated they want to pull out because of costs, casualties and because the Iraqis completed their election Sunday.
Bush explained in detail how, under his proposal, younger workers would be able to divert some of their Social Security payroll taxes into private accounts "so you can build a nest egg for your own future."
Nowhere did he give the other side of the equation - that Social Security benefits for those workers would be reduced as a result. He stated "your account will provide money for retirement over and above the check you will receive from Social Security," without explaining that that check would be smaller.
Moreover, he seemed to issue a guaranteed return on investment for people putting some of their retirement money in the market, saying: "Your money will grow, over time, at a greater rate than anything the current system can deliver."
Although his plan promises checks and balances to ensure such money isn't frittered away on risky investments, it does not come with a guarantee of performance exceeding benefits of the current system. It does, however, come with that expectation.
Declaring Social Security will go broke if nothing is done, Bush said that by 2042, "the entire system would be exhausted and bankrupt."
The nonpartisan Congressional Budget Office forecasts Social Security as it is would be able to pay 73 percent of benefits in 2042 and stay solvent for 10 years beyond that.
"The speech does what one would expect it to do: focuses on advantages of the plan, not on the risks," said Kathleen Hall Jamieson, director of the University of Pennsylvania's Annenberg Public Policy Center.
"The worrisome parts of the speech are those that use the word 'bankruptcy,'" she said. "The speech suggests that the threat is more imminent than it is."
Bush did not, however, try to sell his plan for partial privatization as a solution to the entitlement program's looming fiscal crisis. He acknowledged there are various proposals for limiting benefits down the road and said, "All these ideas are on the table."
Also in the speech:
- Bush called Iraq "a vital front on the war on terror" and said Americans "are fighting terrorists in Iraq so we do not have to face them here at home."
The terrorist link that the United States most worried about when it invaded Iraq - an alleged relationship with the al-Qaida network behind the Sept. 11, 2001, attacks came to little.
Bush said his "Clear Skies" legislation will cut power air pollution from power plants. A preliminary report last month by the National Academy of Sciences predicted Bush's plan would reduce air pollution by less than the current Clean Air Act rules.
Bush said the U.S. economy "is the fastest growing of any major industrialized nation." Although not a member of the G-8 club of industrialized nations, China posted growth last year of 9.5 percent, its government said, more than double U.S. growth of 4.4 percent.
Associated Press Writer Sam Hananel contributed to this report.
© 2005 The Associated Press