U.S. Sens. John Cornyn and Ted Cruz, both R-Texas, met with leaders from Galveston, Brazoria and Matagorda counties at Rice University’s Baker Institute for Public Policy Jan. 17 for a roundtable discussion about the Galveston Plan that was designed more than 30 years ago as an alternative to participating in 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 Rice President David Leebron and Baker Institute Founding Director Edward Djerejian.
“Rice University is always thrilled to be a resource in whatever way for our elected leaders and those responsible for our government policies, and we’re thrilled to contribute in this small way,” Leebron said.
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, assets that can provide for them security in retirement, and assets that can also make a very real difference in the lives of their children and their grandchildren,” he said.
Cornyn extolled 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. “The long-run deficit is mainly due to overspending and entitlement programs,” he said. “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 just listen to a real-world policy alternative that sounds like it has been successful in action as opposed to taking up pages in a quiver. This is an extremely important topic that has to be addressed in the coming years.”
The event drew reporters from KUHF, KTRH, KXLN, KTMD, Telemundo, Univision, YNN in Austin, the Houston Community Newspapers and the Dallas Morning News, among others.