Let the flailing begin!

With approval for President Bush down to the low- to mid-40s and private accounts doing even worse, the Bush White House and Congressional Republicans are finally starting to try to scramble to pick up the pieces.

One idea being raised by Senate Republicans is to pay for private accounts with surplus Social Security revenues — a brilliant way to drive home the enormous transition costs that privatization requires. As the Washington Post points out, “The strategy is controversial because it would create new budget problems. Either the diverted money would have to be replaced with new taxes, or Congress would have to slash programs now funded by Social Security’s excess payroll taxes.” Why anyone thinks this will work is beyond me.

Other, more realistic Senate Republicans have reportedly told the White House that “they are stuck in a deep rut and suggested it is time for an exit strategy” on Social Security. The problem, as the Post noted, is that Republicans are now stuck in a Catch-22:

Democrats are united in their opposition, and the [Senate] Finance Committee does not have the Republican votes to approve a Social Security plan that would divert some payroll taxes to private investment accounts. But the committee, which has jurisdiction over the issue, also does not have the votes to pass a plan that would preserve Social Security’s solvency without the personal accounts because too many GOP conservatives want them.

And on top of all this, the White House has delayed the release of the recommendations of President Bush’s tax reform panel until the end of September, hoping that it will have passed a Social Security package by then. But if not, it’s unlikely that Bush will pass a tax reform package while he is President.

In short, the wheels are coming off the wagon. Absent another terrorist attack, we may be looking at Jimmy Carter part II.