I Really Hope They're Not Seriously Considering This

[rowyn]

The House Committee on Education and Labor hears testimony on nationalizing* pensions and 401(k) accounts.

Dear Congress:

I do not want a bailout. I do not want to be punished for having chosen to save for my retirement by having my savings taken away from me. I do not want my retirement savings to go bankrupt by the time I'm 65 the way the existing Social Security Administration is going to. In short:

DO NOT WANT.

Please keep your grubby hands off of my investments. K thx.

Love and kisses,
Rowyn

* Edit: shaterri looked at the actual testimony (which I can't do at the moment, so see his comment below), and apparently the article linked above is at the least inflammatory if not outright fabrication: the testifying speaker doesn't advocate "confiscating" existing 401(k)s or pensions. I feel better. Thanks, Shaterri! And I'm sure Congress wouldn't take her seriously even if she had. Really. 99.9% sure, anyway.

Comments

[shaterri.livejournal.com]

Ummm, read the article more closely? The Ed&Labor committee did not conduct any such hearings; they merely had a hearing on, quote, "The Impact of the Financial Crisis on Workers’ Retirement Security," which seems under the circumstances like a perfectly reasonable thing to be holding hearings on. And at that hearing, they had a speaker in no way affiliated with the government who suggested GRAs. What's more, if you read her actual testimony, while Ghilarducci is obviously no fan of 401(k) plans and does suggest gradually scaling back the deductions on them (her own phrasing), never does she indicate that GRAs would be mandatory the way the article suggests. Here's a direct quote from her testimony:

Short term, I propose that since 401(k) accounts and the like are financial institutions [...] Congress let workers trade their 401(k) and 401(k)-type plan assets for a Guaranteed Retirement Account composed of government bonds.

And if you read the testimony of any of the other participants, it becomes clear that the committee was doing what committees are supposed to do -- gather information and suggestions from a plethora of sources. Even the article itself concedes that, quote, "[the committee chair] said he would not be in favor of 'killing the 401(k)' or of 'killing the tax advantages for 401(k)s.'"

I'm obviously not going to contend that the notion didn't come up; it obviously did. But there's no indication that it's under any serious consideration, and the whole article reads to me of distinctly slanted journalism (vis. the 'redistributive change' canard), well worth taking with many, many grains of salt.

Okay, I feel better

[rowyn]

Ah! I did read the article closely, and it said the individual testifying advocated "confiscating workers' retirement accounts". I can't follow your link right now (doesn't work on my cellphone browser). But since that's not what she was saying, yeah, that's reporting which goes beyond "misleading" and into "outright fabrication". O_o

I knew the hearing wasn't devoted exclusively to her views anyway (hence my "hope this isn't serious") -- I'll edit my post to clear that up. Sorry!

Re: Okay, I feel better

[jordangreywolf.livejournal.com]

Hoo boy. I'm glad I saw your edit note there.

Re: Okay, I feel better

[sebkha.livejournal.com]

Foxtaurs: our gatekeepers of journalistic integrity.

[zaimoni.livejournal.com]

Having read the actual testimony: since the proposal includes, as a later stage, completely wiping the law authorizing 401(k)s from the map, it is a confiscation (at that time) for everyone who cannot afford to pay the tax penalties from cashing out.

There is no point pretending otherwise. And while this floats like a lead balloon now, it is not so clear that when 401(k)s are empirically bad for everyone that U.S. Congress will refuse to do what West Virginia's Congress did for its teachers' unions: confiscate all of the 401(k)s because the claims made about them as retirement savings were false, and replace with a politically correct pension. [In West Virginia's case, the affected teachers had their retirement payouts immediately double.]