Will Obama Take Your 401(K) Retirement Funds?
Posted by mb50
By Paul Walter
May 20, 2013
For almost a year we’ve seen bold headlines that Barack Obama is in the process of taking 401(k)’s, ostensibly to pay down the national debt (created by politicians we elect to office). The same flavor of borrowing against federal employee retirement funds until Congress can borrow more money:
“In a letter to congressional leaders Monday, Treasury Secretary Timothy Geithner said he is suspending new investments in both the Civil Service Retirement and Disability Fund (CSRDF) and the Thrift Savings Plan G Fund, which is invested in federal securities. In addition, the department will redeem some of the investments held by the CSRDF, Geithner wrote.
“Federal retirees and employees will be unaffected by these actions,” Geithner said. By law, both funds must be made whole once lawmakers agree to increase the debt limit.
“The Federal Retirement Thrift Investment Board also Monday stressed that TSP investors will not be harmed. Under a 1987 law, the government is required to repay suspended G Fund investments, including interest, once the debt ceiling is raised and the government can resume borrowing. The board will keep track of what Treasury owes and how much interest the G Fund would have accumulated had the investments not been suspended. “You have an IOU from the federal government for the G Fund,” board chairman Andrew Saul said. “It’s not going to affect them [TSP investors], period.”
It’s easy for Treasury Secretary Geithner to reassure federal employees filching their life long “nest egg” funds is backed by a worthless IOU since it’s not his retirement.
This is known as robbing Peter to pay Paul. Instead of reducing the size of government by eliminating unconstitutional cabinets and agencies, Congress simply borrows more debt from foreign governments. Repayment of those civil service retirement funds is paid with debt. Can you describe anything more irresponsible than that? Try this one: The US Government spends $435,841,200 per hour
Art. II, Sec. II of the U.S. Constitution does not authorize the president to spend or borrow one penny of the people’s money. He can use the ‘bully pulpit’ with his party to move the idea along. But, any such change in existing laws would have to come from Congress. Does that mean Obama won’t try? Nothing is out of the realm of possibility when it comes to the current occupant of the White House.
As the dollar continues to lose its purchasing power, many seniors are finding their 401(k) accounts are not going to get them through through their golden years:
“According to the Center for Retirement Research at Boston College, the median household retirement account balance in 2010 for workers between the ages of 55-64 was just $120,000. For people expecting to retire at around age 65, and to live for another 15 years or more, this will provide for only a trivial supplement to Social Security benefits. And that’s for people who actually have a retirement account of some kind. A third of households do not. For these people, their sole retirement income, aside from potential aid from friends and family, comes from Social Security, for which the current average monthly benefit is $1,230.”
Both the White House and the Congress send up ‘trial balloons’ periodically to see how the American people will react to something being bandied about back rooms in the halls of Congress or the Oval Office that directly affect our lives. If the initial response isn’t the desired one, input from think tanks and special interest groups help shape new proposals:
“A recent hearing sponsored by the Treasury and Labor Departments marked the beginning of the Obama Administration’s effort to nationalize the nation’s pension system and to eliminate private retirement accounts including IRA’s and 401k plans, NSC is warning.
“The hearing, held in the Labor Department’s main auditorium, was monitored by NSC staff and featured a line up of left-wing activists including one representative of the AFL-CIO who advocated for more government regulation over private retirement accounts and even the establishment of government-sponsored annuities that would take the place of 401k plans.
“This hearing was set up to explore why Americans are not saving as much for their retirement as they could,” explains National Seniors Council National Director Robert Crone, “However, it is clear that this is the first step towards a government takeover. It feels just like the beginning of the debate over health care and we all know how that ended up.”
“A representative of the liberal Pension Rights Center, Rebecca Davis, testified that the government needs to get involved because 401k plans and IRAs are unfair to poor people. She demanded the Obama administration set up a “government-sponsored program administered by the PBGC (the governments’ Pension Benefit Guarantee Corporation).” She proclaimed that even “private annuities are problematic.”
“Such “reforms” would effectively end private retirement accounts in America, Crone warns. “These people want the government to require that ultimately all Americans buy these government annuities instead of saving or investing on their own. The Government could then take these trillions of dollars and redistribute it through this new national retirement system.”
Should Americans be concerned about such a move? Very. Congress has created a ‘national’ debt of close to $17 trillion dollars. Unpaid mandates that have to be paid down the road on social security, Medicare and the ‘prescription drug liability’ program total $123.9 trillion dollars. Your share of that debt is a whopping $1.9 million dollars over your lifetime.
Most people have a difficult time wrapping their head around such astronomical numbers. There isn’t any real money to pay those obligations, so where will the money come from? As quoted above: “.. once the debt ceiling is raised and the government can resume borrowing.” What better place to begin borrowing than private pension funds using state of the art accounting methods that endanger everyone’s retirement funds. Nationalize the nation’s pension system and you’ve got the goose that will lay golden eggs…..for about ten days of spending. Then what?
Americans were far better off before government stepped in to “help” them with saving for retirement because anytime the government says “we’re here to help you,” that’s the time to grab your money and run the opposite direction.
The first steps towards nationalizing your retirement are underway. Every “national” program administered by the federal government is a monumental financial disaster. The numbers don’t lie, but politicians do.
We are all victims of the inept, morally irresponsible actions of one Congress after another for decades, yet, we keep reelecting them expecting different results. If you don’t think allowing the federal government to take over the only thing you will have when you finally retire is a good idea, now is the time to let those who represent you in Congress know how you feel. Before they scoop up your life’s savings backed by an IOU. They will owe you all right and it won’t even buy a cup of coffee.
To summarize it all for you.
Lets say you spend 20 plus years in the military and retire at 38 or 40. You receive your pension from the service. Still at a young age you decide to work for government or a private corporation for another 20 years or so. That will entitle you for another retirement pension. Then at age 65 you qualify for Social Security. Politicians call that triple dipping. The time is coming (sooner than you think) you will only be allowed to keep one, all in the name of saving the economy. All a big lie of course, because they created the conditions in the first place. (Called Theses, Syntheses, and Antitheses. Create the problem, offer the solution and walla, you have the desired outcome). Why are they doing this you ask? Simple! Wealth means freedom and independence. A person that’s financially well off can not be controlled, a poor one can. Poor people will do whatever they’re told and look to government for sustenance. That’s Communism. Everybody looks to mother government to take care of them. What the communists (aka: RINO’s, Liberals or Democrats) fear the most is individuals who don’t need the government and can think and care for themselves. I believe the backlash is coming and they are counting on the loyalty of the police to protect the crooks from the angry public demanding justice.
© 2013 Paul Walter – All Rights Reserved
Posted on May 20, 2013, in Financial repression and tagged Barack Obama, Congress, Federal Retirement Thrift Investment Board, Labor Department, Obama, Oval Office, Social Security, Timothy Geithner, trial balloons. Bookmark the permalink. Comments Off on Will Obama Take Your 401(K) Retirement Funds?.
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