Friday, January 8, 2010

Government Is Ready to Raid Your 401K and IRA

Another chance for equality (i.e. making everybody poor) coming our way via the Obama government. They've been quietly at it since after the election in 2008, and now finally they are coming out and asking for public comment. That means it may become a bleak reality pretty soon.

What is it? Well, your government wants to stuff your 401K and IRA with what they call safe "annuities". Who would provide those "annuities"? Probably none other than the Treasury Department, in the form of special Treasury bonds. For your own good, so that your money is "secure".

Americans Oppose Proposals to Limit 401(k)s, ICI Says (Update1)
(Jeff Plungis, 1/8/2010 Bloomberg)

If you simply look at the title of this article, you wouldn't know what is really about. But here it is:

"Seven in 10 U.S. households object to the idea of the government requiring retirees to convert part of their savings into annuities guaranteeing lifetime payments, according to an institute-funded report today. The Washington-based institute represents the mutual-fund industry. "

"Lawmakers have proposed changes, and the Obama administration will seek ways to promote conversion of 401(k) accounts after their average value fell in the past three years alongside a 46 percent drop in the Standard & Poor’s 500 Index."

"The U.S. Treasury and Labor Departments will ask for public comment as soon as next week on ways to promote the conversion of 401(k) savings and Individual Retirement Accounts into annuities or other steady payment streams, according to Assistant Labor Secretary Phyllis C. Borzi and Deputy Assistant Treasury Secretary Mark Iwry, who are leading the effort."

Mark Iwry is from Brookings Institute who has been quietly working on the Obama administration's scheme of stuffing 401K and IRA with special Treasury bonds, and of mandating a national IRA for all employers. This blog has reported on this effective government takeover (albeit partially) of 401K and IRA in here and here.

Do not, for a moment, believe this is about the financial security for Americans. This is just another scam to siphon off wealth from the public. Remember the Treasury Department is fast running out of buyers for the government debt, willing or not. Therefore the government is turning to the least tapped source of buyers who have least say in just about everything: American public.

1 comments:

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