Fox News Sunday, "Choosing the President" interviews: on Social Security

Fred Thompson: Revamp Social Security to pay $2.5T for new tax plan

A: First, I’ll say I hope your estimates are better than the professionals who estimated that we would get so much less in capital gains revenue if we lowered the capital gains rate. They were totally wrong about that. They were wrong as to the amount of tax revenue we would lose under the 2001 tax rate cuts also. They always overestimate the losses to the government.

Q: So give us three specific things you would cut.

A: Well, let me give you one big one, that’s worth about $4.7 trillion--my Social Security plan. I have put out a Social Security plan that basically faces up to the fact that Social Security is going bankrupt and we’re going to have to do something about it [by allowing 2% of your payroll into a private personal account].

Fred Thompson: Allow 2% into a private personal account, with 2% match

In the long run, the government would come out ahead. A person would have a nest egg at the end of his retirement time.

And if you do that in conjunction with indexing the initial Social Security benefit to inflation instead of wages, at the end of the day you’re going to save Social Security. You’re going to put it on a sustainable basis. And it will save the government $4.7 trillion at the end of the day. So eventually you do have to address the spending side, but the spending is going to have to be addressed on the basis of our entitlement difficulties.

John McCain: Save benefits by bipartisan agreement; but without new tax

A: Before we get into any of those specifics, you have to know that anyone who gets out front on this issue without sitting down and negotiating with everything on the table will get nowhere. And so I will do what Ronald Reagan and Tip O’Neill did. I will sit down with the Democrats. We will look at the options on the table. We’ll call in the smartest people that we can find, and we’ll reach an agreement.

Q: Back in 2005, you said you could support an increase in Social Security taxes as part of a compromise. Do you stand by that?

A: As part of a compromise, if you come up with a benefit, I can accept almost anything, but it’s got to be part of a compromise. Am I for raising anybody’s taxes? No, I am not. I am unalterably opposed to doing so. I will not support a tax increase; it’s off the table, certainly, now.