Has anyone heard of this re: 401k/403b? Warning: political topic

Someone at work mentioned this to me and the way it sounded was getting me pretty angry. But I feel like there has to be more to it. I don't have the time right now to read through it all but I thought someone else may have heard something about this.


http://www.humanevents.com/2010/05/04/republicans-sound-alarm-on-administration-plan-to-seize-401ks/


http://www.shrm.org/hrdisciplines/benefits/Articles/Pages/Tax-Incentives-401%28k%29-Plans.aspx

http://www.assetpreservationinstitute.org/storage/pdf/ObamaAdministration401Ks.pdf

Re: Has anyone heard of this re: 401k/403b? Warning: political topic

2 of the 3 attached links are from 2010, but the 2nd one is from 11/12. I'll take a look, but it appears that these articles are on republican/conservative websites and, IMO, are conservative "scare tactics."

Re: Has anyone heard of this re: 401k/403b? Warning: political topic

I don't really know much about it, I'd have to look into it more, but I will say I question those sources. Particularly the third one. I knew it was a biaed heritage foundation document, but once they started citing Jerome Corsi and World Net Daily I stopped reading altogether. Corsi is a bigot and aconspiracy theorist and World Net Daily is a disgusting publication. If it were print, the editors of the NY Post wouldn 't even wipe their butts with it. he recently reported that Obama is gay. LOL

But that having been said, I'd be interested to hear more. From the facts I could see, it seems like it was a set of solutions posed in 2010 (the newest artcile seems unrelated??), based on specific industries. I'd love to see a more fact-based article. A quick google search didn't yield good results but I'll keep looking

Message edited 12/6/2012 11:29:57 AM.

Re: Has anyone heard of this re: 401k/403b? Warning: political topic

Looking further, the article cites the "Ghilarducci Plan" as if it's a government plan going forward. In fact, it's the results of the research of a Princeton University professor and economist and HER idea about what we should do, which is a mandatory government controlled retirement plan. SO many economists write books and Op Eds about what they think lawmakers should do, but it doesn't mean that it will ever happen

Re: Has anyone heard of this re: 401k/403b? Warning: political topic

The first and last "articles" are straight up sensationalized "journalism." They are trying to suggest that what is happening in Argentina could happen here. Could cows fly? Could the federal government create new tax laws that change the favorability of tax deferred accounts, yes. And frankly I would be shocked if it would not happen.

The fact is companies are not providing pensions to their employees the way the used to - that is not new news. What they could do, and SHRM an industry recognized group points out, is that some plans may want to offer the ability for a 401k member to have an annuity with the money in their 401k. I am sure there would be a lot of fees for that because it is someone else administering your money. If you are responsible with your money you might not need that product.

What the "articles" are trying to suggest is that the federal government is going to take your 401k money to give it to someone else. What I think I once read elsewhere but could not find a link - is that someone once suggested having everyone have 401k accounts instead of funding social security so you could see how much money you have and the government would no longer have social security. That was a Republican plan idea at one time or another. If the feds took peoples 401k you would see riots like no tomorrow and frankly I think there would be runs on the bank causing massive depression.

Re: Has anyone heard of this re: 401k/403b? Warning: political topic

I think the idea behind the plan is to 1) force people to save. if you look at the stats in the article it says 43% of people have less than $10K in their 401K, yet 73% of people feel their 401K will be sufficient, that just doesn't add up. We wouldn't have seniors eating cat food if people were smarter about saving all along.

2) if the government takes over certain plans, they can guarantee a payout, whereas some of these union plans are failing. I assume this would cost taxpayer dollars.

3) Change the tax deferred status of 401Ks. I can see how this could bring in more revenue, but I feel it's contraryto the purpose of getting people to save more.

I think this articles are a bunch of scare tactics conflating several different issues.

Does anyone know if there is any current plan before either house of legislation regarding this?

Re: Has anyone heard of this re: 401k/403b? Warning: political topic

Here's some more good info fromFactCheck.org

Note that this article and the hubbub are from November 2008, before President Obama was even the President.

Articles that try to tie this to him or to "Obamacare" are plain falsehood.

Although the articles try to insinuate that the government would seize the funds and/or force people to do anything, even the plans don't advocate for that.

Just a scare tactic.

Message edited 12/6/2012 12:00:56 PM.

Re: Has anyone heard of this re: 401k/403b? Warning: political topic

DH works in research at a financial services company and I was asking him about this over the weekend. It's not a fleshed out plan, but something that has been batted around and it seems like it's starting to get some traction. In a nutshell, there are some who feel that the gov't should take over retirement plans (similar to the way social security is run) and then they'd force a specific percentage (say 25%-33%) of all plans to be in treasuries.

But DH said it's a LONG way from becoming a reality and people should really be focused on/planning for the issue of the financial cliff as well as some of the increased paycheck withholdings that will be starting in January since that's going to directly impact wallets in the very near future.