[Paleo Conservative]

Wonder how it got that way. Many of those underfunded plans were underfunded at the behest of the unions.

I'd much rather have a defined contribution plan than a defined benefit plan. There's no such thing as an underfunded defined contribution plan. Not only that, but I wouldn't want my employer owning and running my pension fund.

This is an artifact of the graduated income tax. Pensions as employee benefits are not taxable to the employer. A flat tax would eliminate the incentive for employees to want compensation in kind rather than as cash.

[sitetest]

Dear Paleo Conservative,

"This is an artifact of the graduated income tax."

There are many tax-advantaged defined contribution plans, too, and have been for 30 years.

Defined benefit plans are actually artifacts of two things: corporate paternalism; and unrealistic fear of the stock market, probably a hangover from the Crash of 1929.

It is rooted in the belief that the average person can't handle his own long-term investments, nor bear the risk thereof.

That's what's currently driving the debate against Social Security reform.

I've even seen people here on FreeRepublic expressing ideas with that underlying assumption.


sitetest