Roosevelt on Social Security

Kevin Drum debunks the supposed FDR quote that suggests that Roosevelt originally intended Social Security to be a temporary program, eventually replaced by private accounts. Here is the quote according to Brit Hume (I have seen this quote elsewhere in the conservative hemi-blogosphere, but can't track it down at the moment):

In a written statement to Congress in 1935, Roosevelt said that any Social Security plans should include, "Voluntary contributory annuities, by which individual initiative can increase the annual amounts received in old age," adding that government funding, "ought to ultimately be supplanted by self-supporting annuity plans."

Here is what FDR really said:

In the important field of security for our old people, it seems necessary to adopt three principles:

First, non-contributory old-age pensions for those who are now too old to build up their own insurance. It is, of course, clear that for perhaps thirty years to come funds will have to be provided by the States and the Federal Government to meet these pensions.

Second, compulsory contributory annuities which in time will establish a self-supporting system for those now young and for future generations.

Third, voluntary contributory annuities by which individual initiative can increase the annual amounts received in old age.

It is proposed that the Federal Government assume one-half of the cost of the old-age pension plan, which ought ultimately to be supplanted by self-supporting annuity plans.

So clearly the phase-out only applied to the first case, and the voluntary accounts were never implemented. Hume's quotation seems worthy of Maureen Dowd. Conservatives need to be aware of this misquote before they trap themselves into making an argument that won't stand up to scrutiny. We really shouldn't suppose that Roosevelt was anything but a socialist, and trying to pretend that his original plan was something conservatives would find palatable is really dumb.

I still say that private accounts are at best a compromise with the truly conservative position of getting government out of the retirement savings business entirely. Joshua Michah Marshall calls my position the Phase-Out caucus. I only wish it really were a caucus.

UPDATE: Looks like Mr. Hume has also been selectively quoted by Drum. Cassandra at Villainous Company links to the original transcript of Hume's remarks which includes some qualifying material. Here are the relevant portions:

Senate Democrats gathered at the Franklin Roosevelt Memorial today to invoke the image of FDR in calling on President Bush to remove private accounts from his Social Security proposal. But it turns out that FDR himself planned to include private investment accounts in the Social Security program when he proposed it.

In a written statement to Congress in 1935, Roosevelt said that any Social Security plans should include, "Voluntary contributory annuities, by which individual initiative can increase the annual amounts received in old age," adding that government funding, "ought to ultimately be supplanted by self-supporting annuity plans."

Last night, Senate minority leader Harry Reid likened the president’s proposal to allow Americans to divert a portion of payroll taxes into personal security investment accounts to "gambling." But in 1999, the Nevada Democrat proposed something very similar on our own "FOX News Sunday" saying, "Most of us have no problem with taking a small amount of the Social Security proceeds and putting it into the private sector."[emphasis mine]

So the point wasn't quite as drastic as Drum (and Al Franken, whom he is evidently echoing) would have us believe. Contra Cassandra, I still think Hume's remarks are irresponsibly misleading, but he clearly wasn't focusing on the specific issue of FDR's original intent. The thrust of his argument was that Democrats are overreacting to Bush's proposal since they themselves have made similar proposals in the past, of which FDR's was a single example.