Caps again, dammit...

Jim McCreery (R-Louisiana)
I DON'T THINK YOU MEANT TO SAY THAT UNDER NO CIRCUMSTANCES CAN PERSONAL ACCOUNTS FUNDED BY A CARVE-OUT CONTRIBUTE TO THE SOLVENCY OF THE SYSTEM. I BELIEVE YOU SAID EARLIER IN YOUR RESPONSE TO A QUESTION THAT IT DEPENDS ON HOW THOSE ACCOUNTS ARE STRUCTURED AND HOW THEY ARE TIED TO THE ULTIMATE BENEFIT PAY-OUT OF THE SOCIAL SECURITY SYSTEM.

David Walker
CARVE-OUTS BY THEMSELVES, WITH NO OTHER REFORMS, WILL EXACERBATE THE SOLVENCY STAYING IN FORCE.

Jim McCreery
ABSOLUTELY.

David Walker
DEPENDING UPON WHAT OTHER REFORMS YOU HAVE WITH A CARVE-OUT, THEY MAY OR MAY NOT CAUSE A... CONTRIBUTE POSITIVELY OR NEGATIVELY OVER THE LONG TERM, DEPENDING UPON WHAT THE OTHER REFORMS ARE. HOWEVER, IRRESPECTIVE OF WHAT THE OTHER REFORMS ARE, THEY WILL ACCELERATE NEGATIVE CASH FLOWS BECAUSE MOST OF THE REFORMS...

Jim McCreery
IN THE SHORT TERM.

David Walker
CORRECT.

Jim McCreery
CORRECT. BUT AS PART OF THE SOLUTION, PERSONAL ACCOUNTS CAN CONTRIBUTE TO THE SOLVENCY OF THE SYSTEM BECAUSE OF THE COMPOUND INTEREST THOSE FUNDS THAT ARE PUT...REAL CASH IN A REAL ACCOUNT IN A REAL MARKET WILL GROW OVER TIME FASTER THAN THIS IMAGINARY TRUST FUND DOES.

David Walker
IT'S VERY, VERY IMPORTANT TO... FOR PEOPLE HOPEFULLY TO AGREE THAT WE HAVE A PROBLEM, IT'S PRUDENT TO SOLVE IT NOW. IT'S ALSO IMPORTANT THAT ENTIRE PACKAGES OF PROPOSALS GET ON THE TABLE, BECAUSE THERE WILL BE PLUSES AND MINUSES TO ANY PACKAGE.