I take a bit of pride in being, largely, level-headed as a blogger. I don’t get truly worked up and outraged and furious around here, preferring calm reason (or, far too infrequently, sarcasm or other forms of humor). It takes a lot to get me spitting mad.
Senator Tom Harkin has once again floated his trial balloon — to get rid of individual 401K retirement plans, and replace them with a new government program, the Guaranteed Retirement Account.
Harkin’s pet Communist (speaking purely economically) says that the 401K system is too risky, and too many people are depending too much on their plans to cover their retirement. She is pushing (and keeps pushing it, thanks to Senator Harkin) a plan where… well, let me just quote Human Events here:
In a nutshell, under the GRA system government would seize private 401(k) accounts, setting up an additional 5% mandatory payroll tax to dole out a “fair” pension to everyone using that confiscated money coupled with the mandated contributions.
What’s wrong with that, you say?
This would, of course, be a sister government ponzi scheme working in tandem with Social Security, the primary purpose being to give big government politicians additional taxpayer funds to raid to pay for their out-of-control spending.
What this would boil down to is first to get the government’s hands on a hefty hunk of money to bail out pension funds, primarily union pension funds, that have been very poorly (if not criminally) mismanaged and are in serious financial trouble. Then, once that’s done, it guarantees the government a fresh, healthy revenue stream that it can treat just like it treats Social Security — a handy, sizable hunk of cash it can loot at will and leave IOUs behind.
When I heard about this, I immediately logged into my 401K plan and checked how it was doing. I took a hell of a hit, but didn’t recall the details.
Between April 2008 and February 2009, I lost about 20% of my plan’s value. But since then, it’s gained that back and then some — it’s gone up 63% since then.
(Note to self: send thank-you gift to ex-girlfriend who
helped me choose chose the funds my plan is invested in back in 2006.)
OK, enough calm reason. Time to get pissed.
That money is MINE. Every penny in that account came from my paycheck, either directly out of my pocket or matched by my employer as part of my benefits package. I own it, I am responsible for it, and I will be damned if I’m going to sit idly by while Harkin and his pet Communists take it “for the common good.”
Over at Ace Of Spades, the usual gang of hotheads are talking about buying rope and measuring DC-area lampposts.
For once, I’m right there with them. Should this start to come to pass, I’ll find some way to close my account or pull as much out as I can before it can take effect. And I’ll contribute it all to the rope funds.
Because this just isn’t about the confiscation of billions and billions in private wealth. It would also deal a crippling blow to the private sector.
I’ve got my 401K split into three funds (thanks again, Chiq!):
Fund 1 (25%):
- Seeks to provide long-term capital appreciation.
- Invests primarily in large and midsize U.S. companies the fund’s advisor believes have above-average earnings growth potential not reflected in their current market prices.
- Advisor seeks out leading firms with excellent long-term growth prospects, many of which have increasing sales, improving profitability, and strong management teams.
Fund 2 (25%):
- Most conservative type of mutual fund; goal is to maintain the $1 value of its shares while providing income.
- Invests in high-quality, short-term securities.
- Appropriate place for savings that you want to preserve, but also want to earn income on.
- Has typically offered higher yields than bank accounts.
- Provides convenient access to your savings; transfer money electronically to and from your bank account.
Fund 3: (50%)
- Founded in 1929, XXX is XXX’s oldest mutual fund and the nation’s oldest balanced fund. It offers exposure to stocks (about two-thirds of the portfolio) and bonds (one-third). Another key attribute is broad diversification–the fund invests in over 100 stocks and 400 bonds across all economic sectors. This is important because one or two holdings should not have a sizeable impact on the fund. Investors with a long-term time horizon who want growth and are willing to accept stock market volatility may wish to consider this as a core holding in their portfolio.
My money isn’t sitting in a vault somewhere. It’s part of the economy, with most of it being constantly invested and re-invested by some fairly competent brokers. It’s circulating among businesses, working hard and advancing the economy.
Our stock market — hell, most of our economy — has grown dependent on the huge amounts of capitol provided by private retirement plans. And it has been a mutually beneficial relationship — the investments from the plans have been, on the whole, quite profitable for the plans.
And the most beautiful part, the best part, is that it is entirely voluntary. Everyone who participates does so of their own free will. I chose, years ago, to ask my employer to take part of my paycheck (before I got my hands on it) and set it aside for my retirement. And they agreed (except for one period when things got rocky) to match, within limits, to match it, dollar for dollar, as part of my benefits package to keep me as a profitable employee.
Let me spell that out: I chose to participate in my plan. I chose how much money (well, what percentage) I would contribute to my plan. And I chose how that money would be invested, generally. And I can choose at any time to take loans from the plan or close it out at any time.
Because, Senator Harkin, it’s MINE. It’s not yours. It’s not anyone else’s.
From a recent pay stub, I see that in that pay period I paid about 9.4% in income tax, 5.9% in Social Security, and about 1.4% in Medicare. On the other hand, my own private insurance ran 4.6% and my 401K contribution was a nice, round 5%.
I don’t expect to ever see any of my Social Security money. First, I have no faith that it will actually survive until I reach retirement age. Second, I have no faith that I will survive to retirement age. (Thanks SO much, genetics.) But right now, Washington’s taking one dollar in six I earn.
That’s enough. That’s more than enough.
Keep your goddamned hands of my retirement fund, Harkin. You and your pet Communist economists can find some other way to bail out your crooked union thugs and pay for your socialist fantasies.
I’m a New Hampshirite, Harkin. And our state Constitution has one part I cherish — Section I, Article 10:
Government being instituted for the common benefit, protection, and security, of the whole community, and not for the private interest or emolument of any one man, family, or class of men; therefore, whenever the ends of government are perverted, and public liberty manifestly endangered, and all other means of redress are ineffectual, the people may, and of right ought to reform the old, or establish a new government. The doctrine of nonresistance against arbitrary power, and oppression, is absurd, slavish, and destructive of the good and happiness of mankind.
I’m a lifelong Granite Stater, and those words are engraved on my heart — along with “Live free or die; Death is not the worst of all evils.”
You want MY retirement money, Harkin?