May 2, 2001

Washington, D.C.-The Small Business Survival Committee (SBSC) was encouraged by President George W. Bush's announcement today of a new Social Security commission.

SBSC chairman Karen Kerrigan noted: "Small businesses are deeply concerned about the future of Social Security.  Not only do we have the same concerns as other Americans when it comes to the solvency of the system, but we also know the very real costs of rising payroll taxes.  Higher payroll taxes mean less money for investment, job creation and employee compensation. With future worker-to-beneficiary ratios approaching two-to-one, there is no way that small businesses could absorb the massive payroll tax increases that would be necessary to fund the program.  The math does not work, and we are encouraged by the focus that has been give to private retirement accounts in President Bush`s announcement of the Commission."

SBSC chief economist Raymond J. Keating added: "It should also be noted that depositing payroll taxes into private retirement accounts, rather than allowing those dollars to be controlled by government, would expand the pool of investment capital and provide a real boost to economic growth.  Allowing individuals to establish private retirement accounts, into which at least a portion of their payroll taxes would be deposited, is critical for true Social Security reform and real financial security for future generations."

Keating concluded: "In the past, government commissions were established to do one of two things-either to avoid an issue or to provide cover for a politically foolish and/or unpopular decision, such as imposing tax increases.  This commission appears committed to dealing with true Social Security reform, and that marks a dramatic turn in a new direction."

For more information, please call 202-785-0238, or visit SBSC's website at www.sbsc.org.  SBSC is a nonpartisan, nonprofit small business advocacy group with more than 70,000 members across the nation.