Democrats Discuss Taking Over People’s 401K’s

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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?

I 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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5 Responses to “Democrats Discuss Taking Over People’s 401K’s”

  1. Your Undecided Voter Says:

    Okay, so you are saying that the average American would be endangered by Obama’s election to the presidency because that would result in a huge swing to the left. He may even bring somewhat socialist ideas (gasp) to the table. Well, what in the world do those claims have to do with Americans, their social/economic advancement, and overall health as a nation? You put these causes out there without giving the implications of their effects and whether or not such things coming to reality would be a negative influence on improving our country’s health. Have you really researched or thought about what that would mean or why it would be detrimental to us? As a continuously informed yet undecided voter, I am delving into the possibility of which presidential candidate can most accurately represent me or if I can know that. You can’t base it solely off policy because such things can fall apart upon entering office. I am proposing that the best way to know how to vote may be to attempt to determine the candidates’ ways of thinking. Figuring out their own biases/beliefs can help me determine how each will face conflict. How do you really know for whom to vote and why? Respond at http://mypoliticalinquiry@blogspot.com

  2. Greg Says:

    I am against spreading the wealth and using my money to support deadbeats that feel they are “entitled”.

  3. Chris Says:

    I concur with Greg. It would be ridculous for the government to take over our 401K’s. This is our money that we’ve been working hard for and not the governments. How could we possibley trust the government to manage our money? Besides a 3% annual return is piddly and not enough to get to our financial goals when we’re 59 1/2, 62 or 65 years of age. I urge everyone to e-mail and call our congressmen and senators. We’re losing our liberties and our freedoms. We’ve already fought for no taxation without representation and now over the past several years history is repeating itself.

  4. Joe Says:

    Have you looked at your 401K recently Chris? 3% return looks absolutely huge to me right now, not that a govt. plan would be limited to 3%.

  5. Rex Coe Says:

    Nuts! Can anyone name anything that government has helped or improved lately? I’m praying for a stop to this madness during the next election cycle, both 2010 & 2012.

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