Democrats Target 401k and IRA Retirement Accounts

[MNReformer]

November 10, 2008
By Karen McMahan

Democrats in the U.S. House have been conducting hearings on proposals to confiscate workers' personal retirement accounts - including 401(k)s and IRAs - and convert them to accounts managed by the Social Security Administration. Triggered by the financial crisis the past two months, the hearings reportedly were meant to stem losses incurred by many workers and retirees whose 401(k) and IRA balances have been shrinking rapidly.

The testimony of Teresa Ghilarducci, professor of economic policy analysis at the New School for Social Research in New York, in hearings Oct. 7 drew the most attention and criticism. Testifying for the House Committee on Education and Labor, Ghilarducci proposed that the government eliminate tax breaks for 401(k) and similar retirement accounts, such as IRAs, and confiscate workers' retirement plan accounts and convert them to universal Guaranteed Retirement Accounts (GRAs) managed by the Social Security Administration.

(snip)

All workers would have 5 percent of their annual pay deducted from their paychecks and deposited to the GRA. They would still be paying Social Security and Medicare taxes, as would the employers. The GRA contribution would be shared equally by the worker and the employee. Employers no longer would be able to write off their contributions. Any capital gains would be taxable year-on-year.

Analysts point to another disturbing part of the plan. With a GRA, workers could bequeath only half of their account balances to their heirs, unlike full balances from existing 401(k) and IRA accounts. For workers who die after retiring, they could bequeath just their own contributions plus the interest but minus any benefits received and minus the employer contributions.

http://www.rightsidenews.com/200811082544/editorial/democrats-target-401k-and-ira-retirement-accounts.html

[rocktivity]

1. Consider the source.

:boring:
rocknation

[MNReformer]

3. I know, but the other links were worse.

Best I could do. Still, do you think this is untrue?

[Throckmorton]

2. No thanks,

I pay enough taxes, which is all this will become.

[Proud_Lefty]

4. Have you researched this beyond this article?

Which Democrats are conducting these hearings? That information should be listed on their websites and lots of information can be found on CSPAN. I'd be curious what you find out. Will these right wing stories ever stop?

[MNReformer]

6. Here it is at US News & World Report & CNBC.

http://www.usnews.com/blogs/capital-commerce/2008/10/23/would-obama-dems-kill-401k-plans.html

http://www.cnbc.com/id/27558644

[Proud_Lefty]

14. What democrats or committees are doing this?

More articles from the MSM don't mean jack. The Republicans have spent years repeating lies to transform it into truth and they're all over the MSM. It doesn't work anymore. I'm more interested on specifics from the senators' and/or house's websites, or CSPAN. Hey, these guys say a lot on the record. There's plenty out there.

[still_one]

5. Democrats DO NOT SUPPORT THIS, and the r/w bullshit that is spreading this around

can go fuck themselves

The Democrats one by a MANDATE. ALl the repukes can do is lie and distort

They are losers who have killed hundreds of thousands of people, and brought our country economic disaster the last eight years

[MNReformer]

7. The meme is that it's a Republican plan that Dems are supporting.

WTF?

[still_one]

10. I know, it has been going around for a couple of weeks. They can't speak to their failures

so they resort to lies and distortions

The republican party is going through a major turmoil between the pseudo "christians", and the moderate republicans

I hope the the moderate republicans take back their party from the extremists

[Sarah Ibarruri]

8. RIGHT SIDE NEWS?

I would hardly put any credence in that. After decades of hearing lies, I seriously doubt they have stopped just because Barack Obama was elected.

[MNReformer]

9. I posted other links above--US News & CNBC. n/t

[Sarah Ibarruri]

12. I don't see any other links anywhere - also, is this being done because....

our country is going to shit and Wall Street is already in the shitpile? I'll tell you what, my 401K has gone to hell. We have fiscal conservatives to thank for that.

[ben_meyers]

11. While Teresa Ghilarducci did in fact testify

and her ideas were pretty much as expressed in her book 'When I'm Sixty-four: The Plot Against Pensions and the Plan to Save Them" (which is virtually unreadable BTW), she was taken about as seriously as Kucinich and his impeachment resolution.

[MNReformer]

13. Thanks, much relieved to hear it. n/t

[chalky]

15. Did the OP read the links posted?

From the CNBC link:

But she doubts Miller will adopt her blueprint in full.

"He wants to make 401(k)s better. He doesn't want to kill the tax deduction. In my favor, he agrees I brought up genuinely credible criticisms of the 401(k) tax break as it exists now." But Democrats may draw from parts of her proposal.

[MNReformer]

19. What parts of her proposal? That is the question. n/t

[chalky]

20. Still more from that same linked article,

Still Teresa Ghilarducci, speaking, and just one line after the last quote I posted:

"The Democrats are looking at two paths," she said.

"One is to make the 401(k) system, which is commercial and individualized, more fair, but not do anything to expand coverage or guarantee returns." The other path is to broaden coverage and guarantee returns. "I think the compromise will be a voluntary guaranteed retirement account. So that if people don't have a 401(k), or want a better alternative to a 401(k), they could put their money into a government-guaranteed fund."

[MNReformer]

21. Thanks -- I was posting without reading all the way through.

(Frantic reaction)...but what does it mean: "not do anything to expand coverage or guarantee returns"? The second option seems preferable, being optional and guaranteed.

[chalky]

22. It means, let it ride. Not exactly a radical change as

401(k)'s currently have no coverage and no guarantee of returns.

[peacetalksforall]

16. How does anyone come up with all this detail and the writer is not on the Dem team?

[Merlot]

17. This article lost all credibility after the word "confiscate"

[4lbs]

18. Huh? Is/was Congress even in session this week or last?

There's nothing this week on either the House or Senate schedules. Same last week too.

[bemildred]

23. Yeah, yeah, "Obama is a Muslin", this is bullshit. nt

[Earth Bound Misfit]

24. A moment of silence...

The OP is no longer with us.