Just a bunch of government hype?

Dave,

I agree totally with you. Look at the stock market at the present. I think we need a gauranteed system
for social security and governed by the government but we should always have the opportunity to free
trade with our own investments such as the stock market and 401k. In the stock market we take a risk and
we buy cheap stock like now but we do not need millions of people to feed if we did not have a Social
Security system. I can see the comparison of the two and the necessary freedom on the 401k and the
necessary requirement on the Social Security. See the government does need to mandate some social programs.

Mark

Well, I think we are a long way from socializing the 401(k) plans. However, that is what the Argentinians thought too. Recently (in the past couple of months), the "president" of Argentina, confiscated the 401(k) plans of her citizens.

I have to respectfully disagree with Dave on this one.Go to www.usnews.com/blogs/capital-commerce/2008/10/23/w... and read the article.Then go to www.marklevinshow.com and download the Oct.27th audio and listen to an interview between "the right wing" Mark Levin and Professor Ghilarducci.
Make up your own mind!!!I would bet there are alot of democrats that support this.

Dave,

Don't be too quick to blow this off. There are at least 2 congressmen pushing the idea. See the attached
article from investment news.
http://www.investmentnews.com/apps/pbcs.dll/articl...

I hope ypu are right Dave. I was reading this article (http://www.marketwatch.com/news/story/savings-refo...) on Marketwatch that scared me enough to come here to see what Dave thought. This seems to be getting a little too much attention for my taste.

I have the utmost respect for Dave and his advice. It's solid and Biblical. However, after reading all the various posts that others have linked here, it's appears that this is not just "hype from the extreme far right" and "totally a lie." Democrats and columnists seem to be giving this idea momentum. Dave, I wonder if you might reconsider your initial assessment? Blessings.

boy, the LAST thing we need is the govt managing that money like they do the SS. after reading the ABC news article that is what Ghilarducci stated: "The Social Security Adm would handle account management, and the Thrift Savings Plan- a well-regarded retirement plan for federal employess would mange the money." GREAT, I feel secure! exceeding inflation by 3%--sign me down.
keep teaching us Dave about this and how to not get stuck.

I'll start by agreeing with the majority of responders that I value what Dave has to say about finances. I'll also agree that his assessment of the situation is all a bunch of right wing hype and the responses of this blog reveal the degree of absolute paranoia that exists within the right wing whenever the "D" word is mentioned. To honestly believe that President-elect Obama would seriously consider taking over 401(k)'s is utter nonsense.

Believe it or not, when compared to the rest of the world's scene, the Democrats are actually relatively right wing. I grew up in Canada which is a fair bit less right wing overall than the US (you know, socialized health care (which works pretty well), subsidized post secondary education so more people can actually afford to get a college education etc) before moving to the US at 33 yrs of age. Our Conservative Party, which was a major political player until recent years, is really pretty close to the Democrats here on the political spectrum. The "Liberals" (now you can swing further to the left than the Democrats or Republicans) have been in charge for a good part of my lifetime and this issue NEVER came up - like Americans, Canadians are encouraged to contribute to their RRSP's (the equivalent of an IRA), get tax breaks for doing so (like here) and have to manage that RRSP ON THEIR OWN since, like in the US (and much of the rest of the world) finding ways to fund pension support for our older population has become an increasingly important issue. SOOOOO, if such a "left wing" country as Canada hasn't (and wouldn't), consider socializing ALL forms of retirement planning and investment, why would anyone believe that it would happen here, in one of the most proudly capitalist and laisez faire countries in the free world? To specifically comment on some of the other posts - does not Rahm Emanuels plan seem like a GOOD idea - 60% (+/-) of Americans are not saving for their retirement and SS will likely NOT be able to fund them when they DO retire - if we "force" people to do some saving now, aren't we encouraging them to do a GOOD thing for themselves (and, heaven forbid, if people actually DO save and may be even able to rid themselves of a need for SS, does this not ADD to our freedom, not take away from it as a another post fears). Second, Democrats have been in power many times before and the fears of posters weren't realized then so what's different now??? Lastly, let me respond to Paul, that "democrats and columnists seem to be giving this idea momentum" Recall that Republicans and columnists gave the idea that Senator Obama was a terrorist too. My point, don't believe all you read, especially when what you read in many cases comes from, to quote Dave in FPU, "your broke brother-in-law with an opinion".

Don't get me wrong - I too believe that we need to keep ourselves informed and make sure that our ideas and concerns are conveyed to our elected officials but to believe that with the election of a single man, our country will convert from embracing capitalism to communism is ludicrous (as well as the political suicide that Dave refers to). I agree with Dave that Obama will NOT fix us of this economic disaster (neither would McCain have) - that fix will have to come from US, the people so, if we're to make this happen, lets all get to focusing on what we need to do to get our own financial (and therefore economic) houses in order rather than feed off of a bunch of paranoia.

Respectfully submitted

It was a balloon floated on the fears the stock market would never function again. But I agree that the average Joe out there doesn't know enough and about themselves to invest their money wisely.

I have alot of clients and my investments in IRAs, mostly Roth IRAs. You can pull your Roth IRA contributions out at anytime for any reason. The growth is the only thing you have to pay taxes and a penalty on if pulled out early.

There would be a mad rush on investments and that is just not going to happen. People in the know would pull their money out before hand. If they make it retro, there also could be millions of lawsuits, which is not a solution. The solution is Financial Education and Action. Not the formal education the real life education.

I think this needs to be taken seriously. This is NOT a "far right-wing" scare tactic. Biden said he wasnted to take the pensions's of corporations... why stop there. Read this article http://ap.google.com/article/ALeqM5i7K20RiBJeMQhhT.... Also, this has been discussed in Congress, if this is not something they are considering then why would they have congressional hearings on it? George Miller, who heads the House committee that deals with 401(k)s, about a month ago said, we have to eliminate this tax subsidy. The government is losing $80 billion a year. They can't afford to lose this kind of money with all the "big government" they want. This is not something to be taken lightly!

I think this needs to be taken seriously. This is NOT a "far right-wing" scare tactic. Biden said he wanted to take the pensions’ of corporations... why stop there. Read this article http://ap.google.com/article/ALeqM5i7K20RiBJeMQhhT... . In addition, this has been discussed in Congress, if this is not something they are considering then why would they have congressional hearings on it? George Miller, who heads the House committee that deals with 401(k)’s, about a month ago said, “we have to eliminate this tax subsidy. The government is losing $80 billion a year.” Dem’s can't afford to lose this kind of money with all the "big government" they want. This is not something to be taken lightly!

I think this needs to be taken seriously. This is NOT a "far right-wing" scare tactic. Biden said he wanted to take the pensions’ of corporations... why stop there. Read this article http://ap.google.com/article/ALeqM5i7K20RiBJeMQhhT... . In addition, this has been discussed in Congress, if this is not something they are considering then why would they have congressional hearings on it? George Miller, who heads the House committee that deals with 401(k)’s, about a month ago said, “we have to eliminate this tax subsidy. The government is losing $80 billion a year.” Dem’s can't afford to lose this kind of money with all the "big government" they want. This is not something to be taken lightly!

Dave, you are wrong on this one. George Miller and Jim mcDermott are currenly working on this in the houlse

Remember, these are the same types that leagallized, in 2000, the "gambling" on Wall St., which led to the increase in toxic securities.
Those same type of things that were made illegal in 1907 after that market crash. It's their own fault, and they want to
take it away under the premonitoin of "fear" that the market/401(k) is unstable, blah blah blah.
I've got some advice, make it illegal again to contract those "doings". Now, because of this and the crash, there is a substantial
amount of "foreign" influence into the banking industry, that same influence that we are combating half way around the world, that they
are going to try and change laws based on ways of beliefs.

Dave: Thank you for this. I am a Christian, a Democrat, and soon to pay off the first of my credit cards thanks to FPU. I don't understand where this sort of thing comes from. Sure, there will always be a few fringe people who want to nationalize 401(k)'s the same way there are a few fringe people who want to abolish Social Security. That doesn't make either likely.

What's being talked about is the problem that freedom brings the ability to make poor choices. The Guaranteed Retirement Account plan says nothing about nationalizing current savings, but rather instituting a new Social Security-like plan that unlike Social Security would have guaranteed returns. This would include the *option* for people to transfer their current 401(k) amounts into the new plan with guaranteed returns.

It's not going to happen; it's one instructor's idealistic idea of what would work in a perfect world and that means it wouldn't work at all in the real world, and by the time it made it into law, the whole thing would have been gutted to the point of being barely recognizable. But even if it happened exactly as written, nobody would be doing anything with your retirement savings.

I think the really important thing here is that if you hear something like this, ask the person who told you where they heard about it. Get to the source. It's amazing right now what people on both sides of the aisle have been willing to repeat without adequate research.

It seems like just a month ago the vast majority of Americans who were paying attention, including Dave, were vehemently opposed to the "bailout". Congress went and instituted it anyway. If Congress wants to confiscate pensions and 401k's they will market it to ignorant person as "something great". The minority who is paying attention will scream bloody murder but Congress will do what it wants because they know that enough of America is pretty much clueless. Why else did they vote to give more strength to a Congress that they have given a 9% approval rating to?

Wait a minute...isn't the government ALREADY trying to manage our retirement plan?
Isn't that what Social Security is?....and look what they're doing with it!
Just my $.02
Rex

Base your opinions on what this person has
said, not what others say she said.

http://teresaghilarducci.org/research/published/

Total educate yourselves :-)

Preserving and Strengthening 401(k)s and Retirement Plans
http://edlabor.house.gov/issues/strengthening401ks...

401(k) Fair Disclosure for Retirement
Security Act (H.R. 3185)
http://edlabor.house.gov/issues/401kfees.shtml

I don't this administration is thinking that far enough ahead to consider the ramifications of ransacking oour our 401K's I think this new government sees it as "Free Money" and they will take it. If they do, will they be
obligated to give us some kind of warning or notice. If this plan comes to fruition I am going to take my
401K and use it to MY betterment, not the government's. Let them take me to jail, I don't give a flying
fig.

I really thought with Dave having such a biblical view on personal financial matters that he would be politically supporting people who share those views. I have a great deal of respect for most of what I have heard Dave say about personal finance, but I think he needs to study this issue further and stop thinking like a democrat. Obama and his fellow liberal democrats are just scary, and it's time for America to wake up and realize.

Dave,
This is untrue and I am astounded in your response to the caller. This was not a "hpye created by the extreme far right." This was actually brought to the table int the House in the beginning of October. He is an acutal qoute while in the House...."This was suggested by the chairman of the House Committee on Education and Labor.
“With respect to the 401(k), it appears to be a plan that is not really well-devised for the changes in the market,” Rep. George Miller, D-Calif., said.
“We’ve invested $80 billion into subsidizing this activity,” he said, referring to tax breaks allowed for 401(k) contributions and savings. With savings rates going down, “what do we have to start to think about in Congress of whether or not we want to continue and invest that $80 billion for a policy that is not generating what we … say it should?” Mr. Miller said."
I do agree with you that if a Filabuster happens, many democrats will want to enforce this, And if Obama approves it, IT WILL BE POLITICAL SUICIDE for him.

Debbie,

This is elementary my dear! I guess you are not smarter than a 5th grader. You learn how bills become laws in elementary school.
It IS political!!!! Who do you think makes laws???? Oh that's right....the government!
Hence it being about politics!

Dave, I am a former Capitol Hill staffer. This professor's invitation testimony were vetted by the Democratic committee staffers-- you'd better believe they support the idea. It is not an endorsement per se, but it means the proposal is being taken seriously.

Oops!!! See previous comment.. I got the wrong country...it was Argentina not Australia where the government toks over the 401K. I have a friend who lives in Argentina and he is moving back to the states because it has become extremely dangerous there!!!

I have noticed that a lot of big banks are laying off people.
Could this be from Dave's work??? A lot of people are cutting up credit cards, is this finally having an effect on the banks??? I could only hope so.

Vic