Obama to tamper with 401(k)'s, IRA's.
My Obama 401(k)prediction is found here.
This item has appeared in Commentary:
It’s still more than two months before the Obama administration takes office, and we are already seeing signs of just how the Democrats intend to govern.
One proposal being floated by Congressional Democrats aims to abolish the tax incentives for individual 401(k) retirement plans. With the recent financial meltdown having hit a lot of people’s funds heavily, those lawmakers think that the time would be ripe to end the private system and fold it into an expansion of Social Security.
The current plan, crafted by Professor Teresa Ghilarducci of the New School of Social Research in New York City, would eliminate tax breaks for these retirement plans. This would be coupled to an increase in Social Security taxes to fund an expanded retirement plan for workers.
Any plan to tinker with IRA's or 401(k)'s would not only constitute theft of the life savings of American workers, but also would cripple new investment in the stock market. For years, a major selling point for continued investment in the stock market has been the projected future influx of additional 401(k) money. Because so much 401(k) money would be available, the argument went, stocks could not help but increase in value regardless of the fundamentals. While that argument has proven to be flawed, any government plan to undermine retirement programs would destroy one of the last good things the stock market has going for it.
Any such action would also make Social Security even more precarious, as retirees would not have their own retirement plans to rely on, but would be more dependant on Social Security.
It looks like Boomsday is turning out to be worse that predicted.