By Amy Goldstein

Washington Post Staff Writer

Saturday, November 10, 2001; Page A05

A presidential commission assigned to redesign Social Security decided yesterday to conclude next month by sending the White House a set of alternatives exploring ways to improve the nation's largest entitlement program, rather than trying to agree on a single plan.

The commission's leaders said each alternative will include a central change to the retirement system that President Bush favors: letting workers for the first time invest some payroll taxes in the stock market through private retirement accounts.

Still, the alternatives will offer substantially different approaches to another central goal: helping the Social Security system withstand enormous financial strains in coming decades as baby boomers reach old age and Americans tend to live longer.

"There are lots of ways you can fix the system," said Richard D. Parsons, one of the panel's two chairmen.

Parsons said one alternative will focus on slowing the flow of money out of the program, including by reducing benefits to future retirees. The commission has considered one method that would essentially curb increases in retirees' monthly checks by linking them to inflation, instead of wage growth -- but has not decided whether to recommend that change.

A second approach will emphasize ways to bring more money into the program, including revenue from elsewhere in the federal budget. Parsons said the panel may propose another plan that would be a hybrid. He said that each alternative would contain enough detail that it could be evaluated by congressional budget analysts.

This is the second consecutive time that a high-level panel asked to develop politically and economically delicate changes to Social Security has ended its task without a consensus. In 1997, another commission that had worked for two years ended up so fractured that its final report contained three plans.

The current commission is far less divisive. All 16 commissioners, split evenly between Republicans and Democrats, agreed ahead of time with a half-dozen principles set forth by Bush, including the controversial private retirement accounts.

Given that broad agreement, the decision to give Bush several choices reflects the changed political environment in which the panel has worked since the terrorist attacks two months ago. When the president appointed the commission in May, he indicated that persuading Congress to restructure Social Security would be a domestic priority in 2002. Yesterday, asked whether Social Security changes would be set on a slower course, former senator Daniel Patrick Moynihan (D-N.Y.), the panel's other chairman, replied, "Oh sure."

Even in the altered climate, the intense politics surrounding the issue were in plain view, as proponents and critics of private accounts clashed over the wisdom of giving the president multiple plans. Key congressional Democrats and several outside groups that oppose individual investments said the panel was blurring the issue and hindering Congress's ability to fix the program.

But conservative allies of the commission praised its caution. "A series of options is probably better. This allows the president and Congress to pick and choose," said David John, an analyst for the Heritage Foundation.

Yesterday's meeting offered a glimpse at the difficult decisions the panel still faces. Members disagreed over whether workers should be able to reach into their retirement accounts early in an emergency -- and whether they should be able to draw on their money as quickly as they want after reaching retirement age.

"What's wrong with your taking $200,000 and running a nice bed-and-breakfast inn or buying a boat?" asked commission member Robert L. Johnson, chairman of BET Holdings Inc. "To not do that would be making something of a charade" of the idea of individual control of retirement accounts, he said.

Several commission members countered that elderly Americans could end up impoverished if Social Security gave them too much freedom to spend their savings rapidly.

Critics of the commission also protested that it has been holding private subcommittee meetings, most recently on Thursday.

"We question the continued efforts of the commission to shield its deliberations from public scrutiny," said a letter written by Reps. Henry A. Waxman (Calif.), ranking Democrat on the Government Reform Committee, and Robert T. Matsui (Calif.), ranking Democrat on the Ways and Means Social Security subcommittee.

Commission members said the closed meetings were legal because they did not include the entire panel and because formal decisions were not made.

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