U.S. Sens. John Cornyn and Ted Cruz, both R-Texas, met with leaders from Galveston, Brazoria and Matagorda counties at the Baker Institute Jan. 17 for a roundtable discussion on the Galveston Plan, designed more than 30 years ago as an alternative to Social Security.
As the entitlement reform debate continues in Washington, the senators wanted to hear directly from those who developed the Galveston Plan. Under the plan, county workers" salaries, together with employer contributions, are placed in private accounts that are invested in the private market.
The participants were welcomed by Baker Institute founding director Ambassador Edward P. Djerejian and Rice President David Leebron. (Pictured above, from left to right, are Djerejian, Cornyn, Cruz and Leebron.)
Cruz applauded the counties for their initiative. "I think one of the critical keys that these three Texas counties have shown is personal ownership and the power of personal ownership to enable people, often who are making modest salaries, to accumulate very substantial assets that can provide security in retirement," he said.
Cornyn emphasized the importance of bipartisanship and leadership in addressing entitlement reform. "We"re going to have to deal with this," Cornyn said. "This is not really a matter where one political party has all the knowledge. Everybody understands the problem, but having the political courage and leadership to actually deal with it, that"s what"s in short supply."
John Diamond, the Baker Institute"s Edward A. and Hermena Hancock Kelly Fellow in Public Finance, welcomed the focus on the long-term fiscal challenges posed by Social Security and other entitlement programs. "I spend a lot of time researching different reforms that could potentially solve this long-run fiscal crisis that the U.S. faces. I"m delighted to come today and listen to a real-world policy alternative that sounds like it has been successful in action. This is an extremely important topic that has to be addressed in the coming years."