Ghilarducci 401k Taxing Scheme Exposed

A couple of weeks ago it came to light that House Democrats were looking at taking away the tax breaks for 401(k) retirement accounts and implementing another socialist ponzi scheme--via a new 5% tax hike.

Democrats are capitalizing on the recent economic downturn (which was of their own making) for this new opportunity to push more big-government solutions on the American people...and to tax you for the privilege.

Incidentally, these are the same Democrats who, while oblivious to the fact that their first socialist retirement system Social Security is fundamentally broken and about to fall, are oh-so-concerned about the 401k private retirement system which has helped expose their Social Security ponzi scheme for the sick horse it is.

Enter economist Teresa Ghilarducci from the New School for Social Research in New York. She rolled out the proposal socialist Democrats are salivating over at an October 7 hearing of the House Education and Labor Committee run by Rep. George Miller (D-CA).

CNBC describes the plan:

Under her plan, workers would receive a annual $600 tax refund if they set aside 5 percent of their pay into a retirement account run by the Social Security Administration, which would then invest globally in risky assets to seek high returns.

From that pool, workers would be paid a guaranteed 3 percent a year indexed to inflation.

The change would encourage workers not to hang on to jobs longer than planned.

Because their returns would be guaranteed, workers would be able to retire on schedule, she said.

"We need people to retire when the economy tanks in order to keep up aggregate demand and to reduce pressure on the labor market. And the only way to do that is to unhook the finance markets from retirement income," she told Reuters.

Wow! A whole $600 tax refund? Can you spend that any way you'd like...or does it require government approval first?

Ghilarducci's plan was first published on Nov. 20, 2007 in the Economic Policy Institute's Agenda for Shared Prosperity. You can read the 20-page paper here.

The Carolina Journal Online also has a report on the plan.

In her plan, Ghilarducci sounds like a good Marxist who would fit right in with Barack Obama's "spread the wealth" mentality. She uses good prol-friendly language about how private retirement accounts are "skewed to the wealthy" and “exacerbates income and wealth inequalities.”

Oh my! That one person might actually have more than another! Such a terrifying thought in the socialist Utopia Ghilarducci and fellow Marxists have in mind for the land of the free and the home of the brave.

The "mainstream" media is of course pooh-poohing this news, with some using creative wording to portray that the talk of this isn't really happening, and others simply patting Americans on the head and assuring them the eventuality just won't be realized.

Does anyone seriously think that the Democrat Party, with control of both Congress and the White House, won't move forward aggressively on such an idea? This is, after all, the party that gave America the bloated, inefficient and terminal Social Security system. This is, after all, the party that is on record time after time after time disparaging the private sector which brought our nation unparalleled prosperity while promoting the idea that government bureaucrats are smarter than you and the free market.

Does anyone seriously think big-government politicians wouldn't also rob these new retirement funds (which comes from the 5% they taxed from you) and spend this money on every new socialist program with which they become enamoured? As they have already done with Social Security?

This is simply another socialist scheme to separate you from more of your own money and make you more dependent on the government for everything.

This is the wrong direction for America.

America was founded as a free nation with a free economy. The United States was founded on the idea of personal responsibility and limited government--elements essential to keep a free people free.

The U.S. Constitution limits the scope and authority of our government to the enumerated powers found in Article 1 Section 8 of the Constitution. Note that you do not find authority there for government charity or government-administered retirement systems.

If we want to remain a free people, we must turn this ship around, folks. We have sailed too far in the direction of socialist mediocrity and bondage. We must turn back before we dock with a permanent prison of our own making.