Yesterday, in San Francisco, there was a second hearing of the House Education and Labor Committee entitled “The Impact of the Financial Crisis on Workers’ Retirement Security.” You can access the testimony here. As there was in the first hearing (discussed in a previous post here), there was testimony advocating a government take-over of the 401(k) system as well as a promise from Chairman Miller that the “Democratic Congress will continue to conduct this much-needed oversight on behalf of the American people.”
A more rational approach was advocated by Tif Joyce:
First, after they calm down, people view the recent financial turmoil as the latest in an ongoing string of challenges that must be overcome. We need to fix our problems because we have no choice.At times like this, both investors and government alike need to be concerned about overreaction and trying to create permanent solutions for temporary problems.
If you ask most voters what they think of “a new national defined benefit plan” I strongly believe they would say, “Please fix Social Security first.”
On October 7th, a witness testified before this committee stating that our nation’s pain and chronic financial anxiety is caused by the corrosive effects of 401k plans…
People understand that life is not always fair and they don’t expect government to legislate certainty. Let’s also keep in mind that huge numbers of people have successfully used retirement plans exactly as they were intended to be used.