The $6 Trillion 401K Grab
by D. Sherman Okst
In 2008 I came across a disturbing article about 401k and IRA confiscation. The article appeared in the Carolina Journal Online. I’ve been following this closely. In fact as recently as February 1, 2010 I became the 93rd person to provide “Informational Comments” on the Department of Labor’s website. My comment was beyond scathing and is therefore posted without a link to it.
Let’s not mince words: The Social Security “Trust Fund” that FDR started 75 years ago is now a 14 trillion dollar black hole.
We trusted Congress to manage the fund and the morons (fiscally responsible Ron Paul, Paul Ryan and a handful of other good eggs excluded) looted it.
The “Trust Fund” now consists of a bunch of IOU’s that will be passed onto our children. It was spent on the day-to-day operations of a bloated government. If you or I managed a pension fund and we stole from it – we’d do time. If we used the money we stole to buy votes – we’d do more time.
Like Health Care, Congress can pass laws that they themselves do not have to follow.
The insanity continues: Tomorrow the United States Department of Labor is holding a hearing on options for retirement plans.
Release Date: August 26, 2010
Release Number: 09-1234-NAT
Contact Name: Gloria Della
Phone Number: 202.693.8664
U.S. Department of Labor publishes agenda for September 14-15 joint hearing on lifetime income options for retirement plans
Washington – To day the U. S. Department of Labor’s Employee Benefits Security Administration (EBSA) released the agenda for the upcoming joint hearing with the Department of the Treasury on lifetime income options for retirement plans. Accompanying the agenda are copies of the witnesses’ requests to testify and testimony outlines. The hearing begins at 9:00 a.m. (EST) on September 14 and 15, 2010. The hearing will be held in the Labor Department’s main auditorium, 200 Constitution Avenue, NW in Washington, D.C.
A live webcast of the hearing will be available on EBSA’s Web site at www.dol.gov/ebsa.
In November of 2008 the Carolina Journal Online carried a piece titled: Dems “Target Private Retirement Accounts” where “leaders” in the U.S. House discussed confiscating 401(k)s, and IRAs and turning them into a GRA (Government Retirement Account).
I suppose that after looting the Social Security Trust Fund and after guaranteeing 14 trillion dollars of taxpayer dollars to the people who blew up the economy, Congress is now brazen enough to think that it can steal 6 trillion more.
This time by confiscation.
According to the article: “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.”
Professor Ghilarducci wrote here about the shortfall's of 401(k)s and IRAs. What Ghilarducci doesn’t mention is that our debt, on and off balance sheet is why workers have retirement savings problems. The average worker toils from January 1 to August 15th to service our debt. This leaves him 138 days of the year to fend for himself. The fact that his wages are circa 1973 doesn’t help him save. The fact that he is paying back looted money with interest doesn’t help him save.
The actual debt numbers are insane. Public Debt is over $13,433,000,000,000.00 (13.4 trillion). Add the GSE (Freddie/Fannie) debt to that and we are over 18 trillion. Pile on the unfunded liabilities hidden on the government’s off balance sheet ledgers: Social Security (14.6 trillion), Prescription Drugs (19.2 trillion), Medicare (76 trillion) and we come up with 128 trillion dollars.
128 trillion dollars of debt is why workers toil 227 days just for Uncle Scam and have no money to save. Stealing their savings and blowing it like they blew social security will not fix anything.
Like Doug Casey says; “giving politicians the ability to borrow is like giving a teenager a bottle of whiskey and the keys to a Corvette.” Great words but “giving politicians” needs to be replaced with “letting politicians steal.”
Reprinted with permission from Financial Sense.
September 20, 2010
D. Sherman Okst [send him mail] became fascinated with the economy in 2007, particularly with the correlation of depleting resources against a growing population. He is an ex-airline captain with about 15,000 hours and is amazed at all the BS we are taught. Aviation or economics, Keynes to Austrian – Bernulli to Newton we've been sold bad goods.