In reporting Republican congressional candidate Rick O'Donnell's position on Social Security, several news outlets have suggested O'Donnell's concept of a “personal lockbox” echoes the Social Security lockbox proposal former Vice President Al Gore espoused during the 2000 presidential campaign. However, Gore's Social Security proposal, unlike O'Donnell's, never included the notion of personal accounts. In fact, O'Donnell's “personal Social Security lockbox” phrase echoes wording used by congressional Republicans and other conservative advocates of Social Security “reform” -- including those who favor partial privatization of the program.

After publishing an essay in 1995 calling for the elimination of Social Security, O'Donnell changed his position. He now says he wants to “fix, not eliminate, Social Security,” according to his campaign website. One solution O'Donnell highlights on his website is the creation of a “personal Social Security lockbox” for everyone. According to the website:

We must stop Congress from spending the Social Security surplus on other government programs. Social Security funds should be used only for Social Security - our Social Security money must be put in a personal Social Security lockbox for each of us, where we can watch it grow and the government can't spend it.

The O'Donnell campaign also has stated that O'Donnell does not support privatizing Social Security. In an August 13 article, The Denver Post reported that while O'Donnell supports a “personal 'lockbox'” for each person, he "[d]oes not support so-called privatization."

In a September 20 "Reality Check" of a television ad alleging that "[n]ow, O'Donnell wants to privatize Social Security," the Rocky Mountain News reported that unlike President Bush, O'Donnell “opposes privatization.” In the same article, the News misleadingly reported, “O'Donnell says his 'personal accounts' refer to the 'personal lockbox' idea once pushed by Al Gore, where the money put into a retiree's account can't be touched by the federal government. He says that unlike Bush, he opposes privatization.”

In fact, while O'Donnell has specifically called for “personal lockboxes,” Colorado Media Matters found no evidence that Gore ever had. As outlined in speeches and debates during the 2000 presidential campaign, Gore proposed using the general budget surplus that existed at the end of the Clinton presidency to protect the Social Security reserve and keep it from being spent on tax cuts or new programs. He often referred to this plan as putting Social Security in a “lockbox.” In his acceptance speech at the 2000 Democratic National Convention, Gore said he “will balance the budget every year, and dedicate the budget surplus first to saving Social Security. ... Putting both Social Security and Medicare in an iron-clad lock box where the politicians can't touch them -- to me, that kind of common sense is a family value.”

Gore did not, however, propose dividing the Social Security trust fund into “personal Social Security lockboxes” for individual taxpayers, which is what O'Donnell's campaign website advocates. A Colorado Media Matters search* of the Nexis database revealed no instances in which Gore described his Social Security plan as anything similar to a “personal lockbox.”

In addition to the News, The Denver Post and KUSA 9News compared O'Donnell's “personal lockbox” proposal to Al Gore's Social Security position in 2000. According to a July 27 editorial in the Post, “All options must be put on the table, O'Donnell says, but first Congress must stop spending Social Security's surplus. In what sounds like an Al Gorean chant, he favors a 'lockbox for each of us, where we can watch it grow and government can't spend it.' ” Also, the broadcast version of a KUSA 9News “Truth Test” about the anti-O'Donnell ad claimed O'Donnell's “personal lockbox” proposal “echoes” that of former Vice-President Al Gore.

In addition, while O'Donnell does not appear to have further defined what he means by a “personal lockbox” none of these media outlets has reported that this phrase has been used by congressional Republicans and other conservatives in proposals that included private accounts.

In 2000, Congressional Republicans proposed the “Personal Lockbox Act,” which sought to:

Structure a tax-exempt personalized retirement program for covered individuals through the designation of a personal retirement account for each such individual that is funded by deposits from amounts in the Federal Old-Age and Survivors Insurance Trust Fund not otherwise required for immediate withdrawal, and by rollover and other contributions made by eligible individuals for investment in any of at least three specified portfolios approved by the Commissioner of Social Security.

The bill's sponsor, Rep. Mark Sanford (R-SC), stated during a 2000 House floor debate:

Mr. Speaker, I just wanted to bring to everybody's attention the fact that today I am introducing a bill called the personal lockbox bill. I think it is built on common sense, because one of the things I have consistently heard from folks back home is the very simple idea that the first part of saving Social Security is making sure that Social Security taxes stay with Social Security. That is what this bill does because it takes the Social Security surplus, whatever that happens to be, and simply rebates it back to the people paying Social Security taxes, not to go out and fix up the car or buy a refrigerator with it but instead to go into their own personal Social Security savings account that would be held by a fiduciary like the local bank.

Similarly, Sen. John McCain (R-AZ) stated during a 2000 Senate debate of the “Senior Citizens Freedom to Work Act”:

Experts agree that the only way to save Social Security without cutting benefits or raising payroll taxes is to allow every American to invest a portion of their Social Security savings in private, higher-yielding accounts. I believe a good start would be to let each person invest about 20 percent of what they pay in payroll taxes in a personal retirement account. These personal accounts would be controlled by the individual, and the individual would be able to monitor the growth of their investment. An added benefit is that each account would be a “personal lockbox'” that could no longer be used by Congress for pork-barrel projects.

The creation of personal Social Security accounts is a recurring theme among conservative policymakers and commentators. In a summary of congressional testimony from 2005, American Enterprise Institute resident fellow Alex J. Pollock suggested creating “your personal lock box” with “the annual social security surplus which protects it for retirement savings, without diverting cash from payroll taxes.” In his testimony, Pollock also said:

The personal lock box would result in greater and more widely distributed ownership of financial assets among American households. It would provide assets with no default risk and no inflation risk, with the ability to pass them on to future generations. It would establish a stronger and more honest financial relationship between government and citizens. Treasury securities are in fact inviolable contracts, in contrast to off-balance sheet future political formulas.

Similarly, in an analysis of the “Growing Real Ownership for Workers (GROW) Act" pushed by Congressional Republicans in 2005, the libertarian Cato Institute claimed in its 2005 publication The Personal Lockbox that the creation of personal accounts like those proposed in the Personal Lockbox and GROW Acts “take the first steps toward reform” of Social Security. The GROW Act would, according to the bill, “stop the Congress from spending Social Security's tax revenue surpluses on other Government programs by dedicating those surpluses to personal accounts.”

According to a 2005 Congressional Budget Office analysis, under the GROW Act, “General funds equivalent to the cash surplus in the Old-Age, Survivors, and Disability Insurance (OASDI) program would be distributed each year into an interim fund, and the following year they would be distributed into individual GROW accounts for workers covered by Social Security.” The CBO analysis also notes:

Account holders could draw from the accounts during retirement, but Social Security retirement benefits for those individuals would be reduced, or “offset,” by an amount based on the size of the deposits made to the accounts. In general, the withdrawals from the accounts would replace only a portion of Social Security benefits. Before trust fund exhaustion, if returns on the GROW accounts were higher than the returns on Treasury bonds, total retirement benefits would be higher than those currently scheduled, and if returns were lower, total benefits would be lower.

The Cato analysis of the GROW Act states that, unlike President Bush's Social Security proposal, “Initially, workers could invest in government bonds only. Unlike the special issue bonds issued to the Social Security Trust Fund, these would be fully marketable government securities.” The Cato analysis does note, however, that, “beginning in 2008 under the Senate proposal and in 2009 under the House plan, workers would be offered additional investment options.”

According to the White House website, President Bush's Social Security plan would allow workers "to put part of their payroll taxes in personal retirement accounts," including “a conservative mix of bond and stock funds that would have the opportunity to earn a higher rate of return than anything the current system could provide.” As noted by the News, “That idea has been called 'privatization.' ”

Neither the Personal Lockbox Act of 2000 nor the GROW Act of 2005 passed.

* Nexis search of “All available dates” in “News, all (English, Full Text)” for gore w/50 (personal w/3 lock!) and social security.

From the September 20 Rocky Mountain News “Reality Check” by Chris Barge:

Summary: The ad likens O'Donnell's stance on Social Security to a man who seems like a hunk online but is a real dweeb when you meet him in person. “Some things look good at first, but then you find out the truth is quite different - like Rick O'Donnell on Social Security." It says O'Donnell wanted to eliminate Social Security and now he wants to privatize it, “putting our guaranteed benefits at risk.”

What's true:

• In a 1995 article titled “For Freedom's Sake, Eliminate Social Security,” O'Donnell wrote “it is time to slay the largest government 'entitlement' program of all, Social Security.”

What's false:

• While O'Donnell says he was a misguided 24-year-old when he wrote the article and now wants to fix the program instead of scrapping it, he has not said that means privatizing Social Security.

What's squishy:

• O'Donnell said recently that he favors “personal accounts” in Social Security, which is the same phrase President Bush has used to describe setting aside some Social Security payments for recipients to manage on their own. That idea has been called “privatization.” But O'Donnell says his “personal accounts” refer to the “personal lockbox” idea once pushed by Al Gore, where the money put into a retiree's account can't be touched by the federal government. He says that unlike Bush, he opposes privatization.