Posted on 11/06/2015 7:11:59 AM PST by Academiadotorg
When academics are ready to fix a problem, hold onto your wallets.
“America’s middle class faces a growing retirement crisis,†Christian Weller and Teresa Ghilarducci write in an issue brief for the Center for American Progress (CAP). “More than half of all working-age households are expected to be at risk of having to cut back their standard of living—often making painful adjustments—when they retire. “
“There are several reasons for the ever-larger looming crisis, but people’s inability to save enough money is a key obstacle to achieving more retirement security. On average, Americans need to save between 10 percent and 20 percent of their salaries each year outside of Social Security to ensure a secure retirement. Yet nearly one-third of working-age Americans have no retirement savings or pension, and less than half of all private-sector workers participated in a retirement plan at work in 2013, the last year for which data are available.â€
Weller is a senior fellow at CAP and a professor at the University of Massachusetts. Ghilarducci is director of the Schwartz Center for Economic Policy Analysis at The New School for Social Research.
The problem as they see it is threefold:
“First, existing savings incentives can be overwhelming and incredibly complex.†“Second, savings incentives often benefit higher-income earners more than middle- and lower-income earners.†“Third, even as the savings incentives fail to prepare households adequately for retirement, the public loses out on increasingly large amounts of tax revenue that otherwise would have been collected without these tax breaks.“ In remarks at CAP, Ghilarducci repeatedly referred to the contributions Americans make to plans such as IRAs as “subsidies,†“tax expenditures,†and “money on the table.â€
In a panel discussion at CAP on the day before Halloween, Ghilarducci’s characterization of individual savings plans was echoed by New York University Law professor Lily Batchelder who characterized employee retirement accounts as “sort of like the government dumps the subsidy into your 401K.â€
That academics view individual earnings as government subsides is problematic enough, especially for the individuals. Even eerier, that notion has taken hold in the U. S. government, particularly during the current presidential administration, where Batchelder served as deputy assistant to the president and deputy director of the National Economic Council.
Ghilarducci is an economic advisor to Hillary Clinton.
Yep.../cashing out
It’s actually higher than that if you add the health insurance ‘tax’ into it.
Come January we will be paying almost $1700 per month for private health insurance for me and hubby. Add our taxes into that and that’s a heckuva lot of money that could be going elsewhere.
This Ghilarducci bitch is baaaaack! Crazy stupid woman. Please, someone find Mark Levin’s interview with her in which he caught her saying.... exactly THIS. That it should lead to management of private savings for a guaranteed return of f’n 3%.... and now with this little twist that “tax revenues are being missed because of the system now in place”. !!!
That’s right— tax revenue is money down a rat hole, and money OUT of the investment economy. Gone, pissed away on national debt interest, maybe, but definitely on overspending.
Hitler is being advised by a Ceauceseau-it socialist theft “economist”. The interview with Levin is priceless, and prescient.
They are coming for our private protected and investment contributing wealth. Can you say.... Greece and the German neo socialists running the EU?
The Federal Reserve cuts interests rates so people will spend money instead of saving money.
Then liberals wonder why half of American adults have no savings and no net worth.
Start with redistribution of the TIAA-CREF and government pension accounts.
Teresa Ghilarducci is widely referred to as “the most dangerous woman in America”. She has been pushing this meme for at least a decade.
Looks like they are getting ready to pull the trigger on it. The Center for American Progress came out with a similar white paper outlining how Obama could rule by decree with a phone and pen, about 90 days before he actually started doing it. When you see it on their letterhead you know the sh** is about to hit the fan.
They are also starting to drop the phrase “failed 401K scheme” in the places on the web where Lefty wackos hang out. Will be making it’s way into the MSM shortly.
This is how they are going to bail out public and union pension funds.
Government has been funding irresponsibility with our money for at least 3 generations.
Sooner or later the money train will run out and all those prepper threads may come in handy.
Good job, ALL!
You’ve said all that I wanted to say.
LOL I stand corrected!
And all of that debt is nearly at 0. Any small increase in the rate will send that debt even higher.
I blame the ‘never pay off your mortgage’ crowd in some part. That idea was pushed so much during the good times and many thought they could make more money than what they saved by paying off their mortgage. While true in some cases, you can control your expenses, but cannot always do the same with income, especially investment returns.
bkmk
Try to seize? SEIZE? it is not physical monies. A simple matter of FedGov overriding computers and all that stuff magically disappears. They do not have to TRY.
Cashing out a 401k early results in losing 40-45%. But 60% is still more than 0%.
Myself, I cashed out a portion last year and paid off my home, am now essentially debt free. Just waiting for this house of cards to fall.
that’s why we’ve been covering CAP since it opened
Same here. Squeezed out life hard to pay off our house and outstanding car debt. Small amount of debt now. Have a good amount in an 401K, but keeping a sharp eye on these people. Like you said 60% of something is better than 100% of nothing.
I had a great IRA, and a super 401(k), but I took them with me on a canoe trip, and you’ll never believe what happened...
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