It's basically an analogous scheme to the 'health care reform'. I would look for the Obama regime to invest social security funds with Wall Street--it has already done that actually, in the sense of taking equity interests in manufacturers and financial firms using social security's surpluses.
Real social security isn't the thing we call 'social security'. Real social security is freedom from want and deprivation--it's guaranteed incomes, access to health care and education, from birth to death. I don't think an automatic IRA plan is going to bring about real social security. But Barry and his Wall Street friends do. -------------- http://motherjones.com/mojo/2010/01/sotu-obamas-automatic-ira-plan-could-make-bushs-wildest-dreams-come-true >>Nonetheless, the automatic IRA plan seems destined to forge ahead, >>steamrolling over other, more secure options. One such proposal was made by >>pension expert Teresa Ghilarducci, who suggested setting up accounts that >>would have a guaranteed government return and be run by the Social Security >>administration. (I outline her plan in my recent Mother Jones article on >>401Ks.) But once again, the American government prefers to skirt direct >>responsibility for looking after its elders, and instead pass us off into the >>greedy, grasping hands of Wall Street–which will no doubt be laughing all the >>way to the bank.<< http://mlyon01.wordpress.com/2009/11/15/how-the-democrats-might-privatize-and-cut-social-security/ Conclusions Obama has already adopted aspects of the Brookings plan for privatizing Social Security for campaign purposes, but he may not adapt them all during the presidential campaign. Nevertheless, the Democrats’ close association with Rubin, Furman, Goolsbee, the Brookings Institute, and the Democratic Leadership Council makes it likely that the Democrats will adopt the Brookings plan once he is elected. As Robert Pollin writes, “But keep in mind that Bill Clinton advanced similar goals in 1992, under his economic program of “Putting People First.” Yet Clinton’s economic program changed drastically even during the two-month interregnum between the November election and his inauguration in January 1993. During this time, Clinton decided that the first priority of his administration would be to serve the interests of Wall Street. The Clinton years were defined by across-the-board reductions in government spending as a share of the economy’s total spending, virtually unqualified enthusiasm for free trade, tepid and inconsistent efforts to assist working people in labor markets, and the deregulation of financial markets.” Clinton made his “decision” based on the same advisors as Obama’s. http://www.brookings.edu/~/media/Files/rc/papers/2009/07_automatic_ira_iwry/07_automatic_ira_iwry.pdf The automatic IRA approach, which was touted by President Barack Obama in his first address to a joint session of Congress, has been included in the president’s proposed budget and has been endorsed by such diverse publications as the New York Times and the National Review.1 It offers most employees not covered by an employer-sponsored retirement plan the opportunity to save through the powerful mechanism of regular payroll deposits that continue automatically. This is an opportunity now limited mainly to 401(k)- eligible workers. Under this approach: —Employers above a certain size (at least ten employees, for example) that had been in business for at least two years and did not sponsor any plan for their employees would allow employees to use their payroll system to channel their own money to an IRA. —Employers would retain the option at all times of setting up a 401(k), a SIMPLE IRA, or other retirement plan instead of a payroll-deposit IRA. Those retirement plans offer employer contributions, much higher employee contributions, and larger tax credits for employers. —These employers, as well as smaller or newer firms that voluntarily offered payroll deposit as a conduit for employee contributions, would receive a small, temporary tax credit based on the number of employees who participated. —For most employees, payroll deductions would be made by direct deposit, similar to the common practice of depositing paychecks directly into employees’ bank accounts. —The arrangement would be marketoriented, with IRAs provided by the same private financial institutions that currently provide them. —Each employer would send all deposits to a single IRA provider of its choice. —As a fallback, individuals and employers that could not find an acceptable IRA on the market could use ready-made, lowcost, automatic IRA accounts through an online clearinghouse that connected employers with financial providers serving as IRA trustees or custodians. If that did not work, an IRA of last resort would be made available by a financial services industry consortium or nonprofit risk pooling arrangement, with investment management contracted out to the financial services industry. —Enrollment would be automatic; employees would save a proportion of their pay in an IRA unless they affirmatively chose to opt out. Employers not wishing to use this method with their employees could likewise opt out and instead have every employee make an explicit choice. In all events, while no employee would be required to participate, no employee could be left out simply because of inattention. Automatic enrollment would thus harness the power of inertia to increase saving in sensible default investments _______________________________________________ Marxism-Thaxis mailing list Marxism-Thaxis@lists.econ.utah.edu To change your options or unsubscribe go to: http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis
