TAKE YOUR ALLIES WHERE YOU FIND THEM:

Bush finds ally in Hub executive (Michael Kranish and Nina J. Easton, April 30, 2005, Boston Globe)

[Robert C.] Pozen and Bush might seem at first blush to be an odd couple. In 2004, Pozen gave $40,250 to Democrats, including $2,500 to Kerry's presidential bid. His national GOP contributions were $1,000, all of it going to Representative Rob Portman of Ohio, according to campaign finance records. Pozen said he voted for Kerry because ''I'm a Democrat."

But Pozen has a history of working with Republicans, too.

He spent about a year as Governor Romney's director of economic development in 2003. In an interview yesterday, Romney said Pozen spent much of his time working to help close a budget gap, but also played key roles on health and auto insurance overhaul. ''When he came into my administration, the economy was sour, we were trying to get our economic ship right," Romney said. ''He helped lead the economic stimulus plan."

Like others, Romney said Pozen approaches issues analytically, rather than politically. [...]

Pozen, who left Romney's administration to become chairman of MFS Investment Management, first worked with Bush when Pozen served in 2001 on Bush's bipartisan Social Security commission. Blahous, then executive director of the panel, also got to know Pozen at the time.

The panel produced three proposals, including creating private accounts and cutting future benefits, none of which Bush endorsed. But an aide said the president remembered Pozen's service on the commission and was intrigued earlier this year when he heard Pozen was working on a new plan that would ensure that lower-income workers received all currently promised benefits.

For months, Bush aides had said they were studying a change in the way benefits are calculated. Under the current system, annual increases in benefits are based on calculations that show the average yearly increase in wages. Bush aides figured if that calculation, known as a wage index, could be changed to a price index -- a calculation of the average rise in consumer prices, which typically rise more slowly than wages -- then most of the solvency issue might be solved.

Bush has said the government made promises on Social Security that can't be kept under the current system. But many Republicans feared that switching from wage indexing to price indexing would be seen as a huge benefit cut, even though the White House insisted that it simply reduces how fast future benefits will grow and doesn't affect current benefits.

Pozen's plan represents a compromise: It wouldn't change benefits for people who earn an average of $25,000 or less annually, but those earning between $25,000 and $113,000 would get benefits calculated on a sliding scale that blends wage and price indexes. Those who earned more than $113,000 would receive benefits based only on the price index, meaning they would have the biggest cut in future benefits.

Pozen outlined his ideas in various newspapers, including The Globe, earlier this year. His opinion piece in The Wall Street Journal about indexing may have caught the White House's attention.

On March 15, the same day the article appeared, Pozen attended a meeting at the White House with Blahous and other advisers. He spent about an hour explaining his indexing plan in detail. The advisers liked his presentation, setting in motion the events that led to Bush's public embrace of it in the Thursday press conference.

After Pozen described his idea at the White House, other Washington policy analysts quickly took notice.

''People have been talking about wage-price indexing for a while," said Michael Tanner, director of health and welfare studies at the Cato Institute, a libertarian think tank. But Pozen's idea to make the system progressive was a new and important wrinkle. ''A lot of us said, 'Oh, now that's interesting,' " Tanner added.

Listening to Democrats argue against a more progressive retirement security system is more fun than a bag of cats.

Posted by Orrin Judd at April 30, 2005 8:53 AM