RALEIGH — 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.
Rep. George Miller, D-Calif., chairman of the House Committee on Education and Labor, in prepared remarks for the hearing on “The Impact of the Financial Crisis on Workers’ Retirement Security,” blamed Wall Street for the financial crisis and said his committee will “strengthen and protect Americans’ 401(k)s, pensions, and other retirement plans” and the “Democratic Congress will continue to conduct this much-needed oversight on behalf of the American people.”
Currently, 401(k) plans allow Americans to invest pretax money and their employers match up to a defined percentage, which not only increases workers’ retirement savings but also reduces their annual income tax. The balances are fully inheritable, subject to income tax, meaning workers pass on their wealth to their heirs, unlike Social Security. Even when they leave an employer and go to one that doesn’t offer a 401(k) or pension, workers can transfer their balances to a qualified IRA.
Ghilarducci’s plan first appeared in a paper for the Economic Policy Institute: Agenda for Shared Prosperity on Nov. 20, 2007, in which she said GRAs will rescue the flawed American retirement income system (www.sharedprosperity.org/bp204/bp204.pdf).
The current retirement system, Ghilarducci said, “exacerbates income and wealth inequalities” because tax breaks for voluntary retirement accounts are “skewed to the wealthy because it is easier for them to save, and because they receive bigger tax breaks when they do.”
Lauding GRAs as a way to effectively increase retirement savings, Ghilarducci wrote that savings incentives are unequal for rich and poor families because tax deferrals “provide a much larger ‘carrot’ to wealthy families than to middle-class families — and none whatsoever for families too poor to owe taxes.”
Did you get that? Your earned income and savings will be forked over to people who don’t even pay taxes. For all the idiots who cast your vote for Obama, congratulations. You got what you wanted.
……In a radio interview with Kirby Wilbur in Seattle on Oct. 27, 2008, Ghilarducci explained that her proposal doesn’t eliminate the tax breaks, rather, “I’m just rearranging the tax breaks that are available now for 401(k)s and spreading — spreading the wealth.”
Somewhere, Karl Marx is laughing his ass off.
8 thoughts on “Next Target for ‘Spread the Wealth’ Dems: Your 401K”
Well, if you’re wondering who Obama will surround himself with, look no further than his first nominee, Rahm Emanuel. The guy is a piece of work.
And who he is sending to the Middle East as an envoy:
Background on Malley:
Malley also has ties to a radical entity called the The International Crisis Group (ICG).
I can hardly wait to see his cabinet.
I didn’t articulate myself well. I didn’t mean that to say that people who get welfare have to pay taxes, I meant that to imply that people who do not pay taxes aren’t eligible for the tax credit that Obama was suggesting. (Therefore, this tax credit isn’t welfare.) The child tax credits work the same way, you have to work to qualify.
As for Democrats in general, I don’t have an interest unless they are in my state. I voted republican on the majority of the choices on the ballot in my state. I don’t like looking at party v party, I don’t want to make choices on that alone. Now since Obama is going to be president I am interested in who he surrounds himself with, but that is about as far as it goes.
Non-taxpayers DO receive welfare. What gave you the impression that they don’t?
There may be federal law-imposed work requirements, time limits, etc, but believe me there are loopholes. I live in an area of the country rife with welfare recipients. They know how to manipulate the system. In addition, why should anyone who does not pay taxes to begin with, receive a tax break or child tax credits. On what???
Obama’s moments of honesty are few and far between, but revealing. He lied about his associations with William Ayers, Tony Rezko, ACORN, The New Party, and Jeremiah Wright, but let slip that he has Marxist theories when it comes to ‘spreading the wealth’. As someone who pays property taxes and pays taxes on my Army pension no less, that is a scary proposition.
We have gone from giving a hand up, as is the American way, to giving hand outs, which is not.
Giving to the truly needy–the disabled and incompetent–is the American norm, not being a welfare trough for people who are just as allergic to birth control as they are job hunting.
Speaking of ‘honesty’ the Democrats could have practiced a bit of that when they denied being responsible for the Fannie Mae/Freddie Mac disaster.
The bottom line is this:
Taking money from the proper owner and transferring ownership of it to the state, so that the state can decide what to do with it, is socialism. That’s exactly what Obama and company want to do.
Like a proposed “growth plan” to confiscate property rights of Bismark Dakota citizens: http://sfcmac.wordpress.com/2008/10/23/north-dakota-county-commissioners-plan-to-spread-the-wealth/
And an Albany, NY council member with his own ideas of ‘spreading wealth’:
Obama wants to punish success by taking what you’ve earned and giving it to others who have not.
At least a third of the people in the U.S. do not pay taxes, but Obama wants to reward them by giving them money provided by working taxpayers.
That. Is. Socialism.
Part of “communism” is spreading the wealth, I will not disagree with that statement in itself. Any politician that has a moment of honesty is going to admit to spreading the wealth, the important thing is where that wealth is spread to. http://www.taxhistory.org/thp/readings.nsf/ArtWeb/2D52A4CFD2844FAB85256E22007840E6?OpenDocument (Sorry don’t know how to make a link in a comment.)
As for your welfare idea it doesn’t fly for a big reason. People who don’t work do not get it, which is what the title of welfare implies. If the argument is that people who get a refund (such as a child tax credit) will get this too, and therefore even if they wouldn’t have had to pay federal taxes then I can agree, in that people that won’t pay federal taxes will get this (if it was to pass as written, which I doubt).
I am adding a few examples from politicians and the honesty. It might come from different places (or the same) but “spreading the wealth” is a norm for America.
McCain – http://www.youtube.com/watch?v=x7pS_ly1YEs
Palin – (start at 2:16) http://www.youtube.com/watch?v=mLEf33E36Lo
I was going to add more (so that both sides are represented), but I my laptop hates youtube and keeps crashing…
You don’t think that your vote for Obama won’t cause economic collapse? What’s the area code of your cave?
He stated emphatically that he wants to take the money of working/taxpaying Americans (‘spreading the wealth’)and fork it over to those who don’t pay taxes, or work, for that matter. That’s the American way??? On the contrary sweetpea, that’s communism in its purest form. That’s centralized government welfare. That is not the American way. Last I checked, free market enterprise was the American way. Not taxpayer-burdened bailouts of people and businesses who failed because of incompetence, over-borrowing, and inability to succeed in the global market place.
I hope you don’t have a 401K. You’re in for a rude awakening.
Thanks. Come back often.
My vote for Obama made this guy created this? You are kidding right? They have been coming up with things like this for many many years… They never get passed, but they have been talking about these issues for a long time…
Sounds to me like the lady is pretty smart give a bit more of a tax break to those that can’t afford the tax, that isn’t socialism that is America.