Republican presidential hopeful Fred Thompson suggested raising
out-of-pocket costs for higher-income Medicare beneficiaries, and rival
Rudy Giuliani ruled out a Social Security tax increase Wednesday in
auditions for support from influential economic conservatives.
"I'm not going to support a tax increase for Social Security,"
added Mitt Romney, a third contender. The former Massachusetts governor
said he saw some merit in raising the retirement age and in scaling
back the benefits promised future retirees as part of a rescue plan for
the government-run retirement program.
In separate appearances before the Club for Growth -- Giuliani and
Thompson in person, Romney via satellite hookup -- the three called on
Congress to cut the corporate tax rate. They also supported renewal of
the tax cuts that have been passed since President Bush took office and
are due to expire over the next several years.
"When you go back to the '20s, to the Kennedy administration, or the
Reagan administration or this administration, you can always see that
lower tax rates generates ... economic growth and generates prosperity
for our country for our people," said Thompson.
With the first voting in White House campaign less than 100 days
distant, Giuliani leads in the national polls for the Republican
nomination, Romney runs strongly in surveys in the early-voting states
and Thompson is a newcomer attempting to emerge as a true conservative.
The former Tennessee senator did not provide specifics of any plans
to restrain the growth of Medicare, instead raising the issue by
saying, "Can we stick with the same premiums and deductions for higher
income recipients on Medicare?"
"All of these will be part of the discussion" when it comes time to
overhaul the federal government's largest benefit programs, Medicare
and Social Security, he said.
It was the second time in recent days that he has broached a potentially controversial subject.
Earlier, he said he supported changing Social Security so that
future retirees receive smaller benefits than they have been promised.
Thompson and Giuliani both said they would appoint a bipartisan
commission to recommend changes to Social Security. As did Romney, they
also said they support private retirement accounts -- the element that
caused Bush's ambitious overhaul plan to collapse in Congress in 2005.
The former New York mayor also said, "I would rule out a tax
increase" to help shore up financing of the federal retirement program.
That was a modest shift from remarks in an Associated Press
interview last month in which he said he opposed a tax increase yet
would look at whatever proposals a commission presented him.
The earlier statement led to an exchange of letters between the
campaign and the anti-tax group Club for Growth, whose political action
committee has intervened forcefully in recent Republican primary
elections on behalf of economic conservatives.
Giuliani's campaign sought to reassure the group that the former mayor opposed tax increases.
"In addition to opposing Social Security taxes, we hope Mayor
Giuliani will go one very important step further and offer a detailed
free-market proposal for reforming Social Security that includes
personal savings accounts and returns choice and freedom to individual
taxpayers," Pat Toomey, the club's president, responded by letter.
While Giuliani's campaign denied there was a change in position, the organization pointedly disagreed.
"While Giuliani has frequently stated his general opposition to
taxes, he has never declared his opposition to raising Social Security
taxes as unabashedly as he did today," the organization said in a
written statement.
Giuliani did a mea culpa of sorts on a different issue, saying he
had erred in originally supporting legislation that placed limits on
campaign donations and political advertising.
"That turns out to be a big mistake," he said of the law that the Club For Growth has opposed.
While all three men courted favor from the conservative group,
Thompson and Romney each differed with their hosts on different points.
The former Tennessee senator, an attorney, said he opposed federal
legislation to limit the damages individuals can receive in lawsuits,
saying the issue should be left to the states. Many conservatives favor
such legislation.
On another issue, Romney said, "It makes more sense to adjust the
minimum wage from time to time," in part so business can plan and in
part to prevent Democrats from reaping political advantage from the
issue.
He made his remarks after Toomey reminded him that some in the audience oppose the existence of a federal minimum wage.
Medicare and Social Security are the federal government's two
biggest benefit programs, and both face daunting financial difficulties
as the post-World War II baby boom generation reaches retirement age.
While Social Security is funded by a payroll tax, Medicare is
financed by a blend of payroll taxes, general tax revenue and
out-of-pocket payments such as premiums and deductibles.
According to the Medicare Web site, most beneficiaries will pay a
monthly premium of $96.40 for out-of-hospital coverage in 2008, but the
cost will be higher for individuals making more than $82,000 or couples
earning more than $164,000.