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[Gene GeRue <genegerue AT ruralize.com>]

In Ads, AARP Criticizes Plan on Privatizing

By ROBERT PEAR

Published: December 30, 2004

WASHINGTON, Dec. 29 - AARP, the influential lobby for older Americans, 
signaled Wednesday for the first time how fervently it would fight 
President Bush's proposal for private Social Security accounts, saying it 
would begin a $5 million two-week advertising campaign timed to coincide 
with the start of the new Congress.

The organization, which played a huge role in the passage of Medicare drug 
legislation last year, said it was prepared to spend much more in the next 
two years to block the creation of private accounts financed with payroll 
tax revenues.

"This is our signature issue," said Christine M. Donohoo, chief 
communications officer for AARP, which represents 36 million Americans 50 
and older. "We will do what it takes."

The full-page advertisements, to appear next week in more than 50 
newspapers around the country, say the accounts would cause "Social 
Insecurity."

"There are places in your retirement planning for risk," the advertisements 
say, "but Social Security isn't one of them."

One advertisement shows a couple in their 40's looking at the reader. "If 
we feel like gambling, we'll play the slots," the message says.

Another advertisement shows traders in the pit of a commodities exchange. 
"Winners and losers are stock market terms," it says. "Do you really want 
them to become retirement terms?"

AARP's confrontational stance on Social Security contrasts with its 
strategy on Medicare legislation in 2002 and 2003.

Senior officials of the group continually talked to the White House and to 
Republicans in Congress about proposals to add drug coverage to Medicare. 
But to date, AARP leaders said, they have had few conversations with the 
White House about Mr. Bush's plans for Social Security.

Lawmakers of both parties said the Medicare bill might not have passed 
without a last-minute endorsement by AARP, which describes itself as a 
nonpartisan organization. The endorsement outraged some members of the 
group and some Democrats in Congress. But now, it appears, AARP will be 
working with Democrats against Republican proposals for private accounts.

AARP strongly supports new incentives for people to save for retirement, 
but says such savings should supplement the existing system.

Marie F. Smith, the group's president, and William D. Novelli, its chief 
executive, set forth the organization's position this month in letters to 
members and to lawmakers.

Private accounts would worsen the problems of Social Security, they said, 
adding: "Taking some of the money that workers pay into the system and 
diverting it into newly created private accounts would weaken Social 
Security and put benefits for future generations at risk. AARP is opposed 
to private accounts that take money out of Social Security."

Under President Bush's proposal, workers could divert some payroll taxes to 
personal accounts that could be invested in stocks and bonds.

At a news conference last week, Mr. Bush defended his proposal as a way to 
encourage "an ownership society," increase savings and provide "capital for 
entrepreneurial growth." By investing in private accounts, he said, workers 
could earn a higher rate of return than they get from the Social Security 
trust fund, and they could pass on the accumulated assets to their heirs.

Ms. Donohoo said AARP's advertisements were intended to "mobilize seniors" 
and to educate younger people about the program, which pays monthly 
benefits to more than 47 million Americans.

The advertisements will generally run three times in each newspaper from 
Jan. 4, when Congress convenes, to Jan. 20, when Mr. Bush is to be 
inaugurated for a second term.

Some advocates of private accounts, like the libertarian Cato Institute, 
are also gearing up. But Jamie W. Dettmer, a Cato spokesman, said: "We do 
not have plans to do advertising or lobbying. Our experts will write op-ed 
articles, appear on television and radio and testify before Congress if 
they're invited."

At a White House economic conference this month, Mr. Bush previewed his 
message to Congress on Social Security. "The crisis is now," he said. "You 
may not feel it, your constituents may not be overwhelming you with letters 
demanding a fix now, but the crisis is now."

On the other hand, Ms. Donohoo of AARP said that "rather modest changes" 
could ensure the solvency of the program for several generations. "It's not 
a crisis," she said.

http://www.nytimes.com/2004/12/30/politics/30retire.html?hp&ex=1104469200&en=7f13c2147ea3ffff&ei=5094&partner=homepage