Wednesday, October 29, 2008

Democrats Discuss Taking Over People's 401K's

If you don't think an Obama, Pelosi, Reid run government would result
in a dramatic swing to the left, read US News and World Reports article
on congress' discussion of takng over people's 401K's. 401K's are not
'rich people' savings plans they are middle America's retirement and
savings plans, and Dems are looking to make them into 'government
created' accounts. Would Obama, Dems Kill 401(k) Plans?
hate to use the "S" word, but the American government would never do
something as, well, socialist as seize private pension funds, right?
This is exactly what cash-strapped Argentina just did in the name of
protecting workers' retirement accounts (Efharisto, Fausta's Blog).
Now, even Uncle Sam isn't that stupid, but some Democrats might try
something almost as loopy: kill 401(k) plans.

House Democrats
recently invited Teresa Ghilarducci, a professor at the New School of
Social Research, to testify before a subcommittee on her idea to
eliminate the preferential tax treatment of the popular retirement
plans. In place of 401(k) plans, she would have workers transfer their
dough into government-created "guaranteed retirement accounts" for
every worker. The government would deposit $600 (inflation indexed)
every year into the GRAs. Each worker would also have to save 5 percent
of pay into the accounts, to which the government would pay a measly 3
percent return. Rep. Jim McDermott, a Democrat from Washington and
chairman of the House Ways and Means Committee's Subcommittee on Income
Security and Family Support, said that since "the savings rate isn't
going up for the investment of $80 billion [in 401(k) tax breaks], we
have to start to think about whether or not we want to continue to
invest that $80 billion for a policy that's not generating what we now
say it should."

Hat Tip to Smart Girl Politics original article Kiss Your 401k Goodbye!

Democrats Discuss Taking Over People's 401K's

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