How’s that ‘hopey-changey’ working out for you now?
by Neal Boortz
I’ve been telling you about this for a while now.
This, to me, is one of the most dangerous schemes currently slitheringthrough the crevices and dark spots of the Imperial Federal Governmentin Washington. What am I talking about? What I believe to be plans bythe Obama administration to, in effect, seize your retirement funds anduse them to finance their deficit spending. Remember … there are morethan $3 trillion dollars sitting out there in individual retirement,IRA and 401K plans. Politicians just cant stand the idea of this muchmoney sitting out there in private investments … out of the grasp ofpoliticians.
So …. something needs to be done. And sure enough,something is going to be done.
The Treasury Department and the Department of Labor were going to starttaking comments on ways to promote the idea converting 401(k) savingsand IRAs into annuities or other steady payment streams. Well you canfinally take a look at this document for yourself:
Request for Information Regarding Lifetime Income Options for Participants and
Beneficiaries in Retirement Plans
Here, I’ll post a little to get you started:
TheDepartment of Labor and the Department of the Treasury (the “Agencies”)are currently reviewing the rules under the Employee Retirement IncomeSecurity Act (ERISA) and the plan qualification rules under theInternal Revenue Code (Code) to determine whether, and, if so, how, theAgencies could or should enhance, by regulation or otherwise, theretirement security of participants in employer-sponsored retirementplans and in individual retirement arrangements (IRAs) by facilitatingaccess to, and use of, lifetime income or other arrangements designedto provide a lifetime stream of income after retirement. The purpose ofthis request for information is to solicit views, suggestions andcomments from plan participants, employers and other plan sponsors,plan service providers, and members of the financial community, as wellas the general public, on this important issue.
That’sa lot of government-speak. Can you read between the lines? What is thereal plan here? Behind this nonsense about “lifetime stream of incomeafter retirement” language is a lovely little plan to force you tofinance the Democrat’s deficit spending. The plan is to play into thecurrent economic fears. “Never let a good crisis go to waste.” Rememberthe words of Rahm? The Democrats want you to question whether or notWall Street is the right place to invest your money. Wouldn’t you besafer if the government kept it for you? The government wants you tobelieve that it can do a better job of investing and managing yourretirement than you can. And for a lot of people who believe thatgovernment is the answer, they may fine with this. It’s not fine withme, and, I suspect, it’s not all that fine with you.
Don’t believe me? Here is how these agencies present their reasoning:
Accordingly,with the continuing trend away from traditional defined benefit plansto 401(k) defined contribution plans and hybrid plans … employees arenot only increasingly responsible for the adequacy of their savings atthe time of retirement, but also for ensuring that their savings lastthroughout their retirement years … In recognition of the foregoing,the Agencies are considering whether it would be appropriate for themto take future steps to facilitate access to, and use of, lifetimeincome or other arrangements designed to provide a stream of incomeafter retirement.
Here is one of the questions asked in this document from the Treasury Department and the Department of Labor:
13.Should some form of lifetime income distribution option be required fordefined contribution plans (in addition to money purchase pensionplans)? If so, should that option be the default distribution option,and should it apply to the entire account balance? To what extent wouldsuch a requirement encourage or discourage plan sponsorship?
Okay,what is this question really asking? First, it wants to know if thegovernment should FORCE you to contribute money to an incomedistribution option. Then the second part of the question wants to knowif this should be the standard retirement option, unless you choose toalso put your money elsewhere.
OK .. I’m a little disjointed here. Let me try to wrap up all of this up in one neat package.
Obama’sbudget is setting records in deficit spending. Obama is proposingborrowing every close to the amount of money that the Republicansborrowed in a single year .. but Obama is proposing borrowing that sumEVERY SINGLE MONTH throughout his term of office and beyond.
Earlierthis week I told you of a story from the investment press which statedthat investors now look at blue chip stocks like Coca Cola as betterand safer investments than U.S. Government treasury certificates. Chinahas signaled that it is not in the mood to buy many more U.S.government securities. This is how we finance our debt! If investorsand other nations won’t voluntary finance our debt, what does ourgovernment do? Well, our government does what governments always do.Fall back on its unique ability to use force to accomplish its goals.There’s a problem here. We aren’t going to force China to buy moreTreasuries … so where is the force to be applied? YOU, that’s where.
Thegovernment is talking about some form of “lifetime income distribution”and “lifetime stream of income.” (Isn’t this what Social Security wassupposed to do?) But just HOW does the government provide this”lifetime” income? Simple … by FORCING you to take all or a portionof your retirement funds and invest them where China won’t go; investthem where private international investors no longer want to go; investthem in Treasury Certificates. Oh yeah … they’ll probably come upwith some fancy new name for some fancy new type of T-bill … but thegoal and the effect will be the same. You’ll see your money seized bygovernment and used to finance the insane spending plans of politicians.. Democrat and Republican.
Stay alert folks. The government haswonderful ways to couch this in language that seams harmless andinnocuous. It’s a money-grab. Nothing less.