Change we can believe in??

Discussion in 'Congress' started by Navy1960, Nov 7, 2008.

  1. Navy1960
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    Navy1960 Senior Member

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    During the past two weeks, U.S. Rep. George Miller, D-Calif., chairman of the House Education and Labor Committee and U.S. Rep. Jim McDermott, D-Wash., chairman of the House Ways and Means Committee's Subcommittee on Income Security and Family Support have entertained proposals that would tax 401(k) plans.

    Both held hearings laying the groundwork for future legislation that could eliminate most of the $80 billion in annual tax breaks that investors receive by placing their money in the $3 trillion 401(k) system.

    The Bulletin - Philadelphia's Family Newspaper - Dems Consider Taxing 401(k)s


    House Democrats recently invited Teresa Ghilarducci, a professor at the New School of Social Research, to testify before a subcommittee on her idea to eliminate the preferential tax treatment of the popular retirement plans. In place of 401(k) plans, she would have workers transfer their dough into government-created "guaranteed retirement accounts" for every worker. The government would deposit $600 (inflation indexed) every year into the GRAs. Each worker would also have to save 5 percent of pay into the accounts, to which the government would pay a measly 3 percent return. Rep. Jim McDermott, a Democrat from Washington and chairman of the House Ways and Means Committee's Subcommittee on Income Security and Family Support, said that since "the savings rate isn't going up for the investment of $80 billion [in 401(k) tax breaks], we have to start to think about whether or not we want to continue to invest that $80 billion for a policy that's not generating what we now say it should."

    Would Obama, Dems Kill 401(k) Plans? - Capital Commerce (usnews.com)

    Along with Universal Health Care, a tax scheme that will in effect crush the ecnonomy, now comes 401K's. This not only assumes that people are too stupid to manage their own retirement accounts but also is another scheme to grow an already over grown government. By taxing 401K's I wonder if congress realizes that the Middle Class and not the so called rich are the ones who will be most effected by this. Personally this scheme is just that a scheme and nothing more, it short sighted and does not take into account that people are better at managing their own wealth than some nameless, faceless person in Washington drawing a paycheck. It simply amazes me that some in Wahsington feel that Americans are incapabale of doing for themselves and providing and building a life for themselves. Is this the beginning of the promised change? If so then they can keep it. I wonder if anyone in the government has ever heard of the word optional? or if that word even exists. If so many out there want the US Government to wipe their collective backsides from the day they are born to the they day they die then give them the option to do so. For those of us who wish to do for ourselves give us the option to do so.
     
  2. CSM
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    CSM Senior Member

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    That's why I keep all my money in a No. 10 coffee can buried in the backyard.

    I bet somewhere in there, those mandatory "fees" (5% of pay along with the $600/year the government so generously contributes) will suddenly become part of the general funds just like social security is....then we can ALL worry about that too when there isn't enough to retire on through either your 401k or Social Security. Seems to me that "redistribution of wealth" means not making the poor better off but making the better off poor!
     
  3. Navy1960
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    Navy1960 Senior Member

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    It would appear that the Middle Class tax cut will be just enough to offset the tax rise for other things like gas and 401K's giving a net of exactly zero. The one thing that strikes me here, is when this bill is about to pass, what is to stop a barrage of calls to investment houses to close 401K's before the government takes them over? Personally, I would rather pay the taxes on mine up front rather than have the US govt. manage it at 3% and go my own way.
     
  4. CSM
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    CSM Senior Member

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    3% will barely cover inflation. You are better off keeping your money to yourself. I have an extra coffee can if you need it (it's Army green so you probably won't want it anyway).
     
  5. Navy1960
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    Navy1960 Senior Member

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    Well CSM, (Navy Gray is more my color and covers up Army Green quite nicely) I will take the can though. I have moved a lot of money from my 401K to CD's , but I think it's getting that time to just close them.
     

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