WASHINGTON-Before Treasury Secretary John Snow launched into a speech on Social Security reform, he was sure to reiterate the administration's backing of credit unions' tax-exempt status. At last week's CUNA Governmental Affairs Conference, the secretary noted that credit unions face a number of issues, including tax policy. "I think you know where we are on that exemption," Snow said to applause. Mostly, he talked about Social Security reform, which credit unions have been following with interest. The credit union trade associations have not taken a position on what shape reform should take. If the program looks like it is leaning toward private accounts, as President George W. Bush has proposed, credit union lobbyists have vowed to ensure that the industry will not be left out of offering these services to their members. Under the president's plan, Snow stated, young workers would create "a better retirement than Social Security would make available to them" currently. A mid-income wage earner, he said, would conservatively establish a $250,000 nest egg under the president's plan. According to the administration's figures, there are three workers supporting every retiree on Social Security; it will not be long until that number is two-to-one, which is "why the president has gone to the country and said we need to talk about this." "The president has ignited broad national debate," Snow said. Debate has shifted from `is there a problem?' to `how do we fix it?' according to the Treasury Secretary. Options aside from the president's proposal include cutting other funding, borrowing, or increasing taxes, he suggested. "Every year we wait this problem gets bigger. It gets harder to fix," Snow stated. The problem is already about $10 trillion, he said, roughly equivalent to the United States' gross domestic product (GDP). -

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