As if you needed another reason to vote out the Democrats. The unions, and some of their Democrat allies in Congress are still pushing to do away with 401k accounts, to be replaced by Guaranteed Retirement Accounts (GRAs). Last month Senator Bernie Sanders (I-Socialist-Vermont) and Tom Harkin (D-Iowa) held a hearing to explore the possibility. Both Senators are members of the HELP Committee (Health, Education, Labor and Pensions – or as I like to call it – the union HELP themselves to our retirement savings.)
House Minority Leader John Boehner and 12 other Republicans signed a letter urging opposition to GRAs to Treasury Secretary Timothy Geithner and Labor Secretary Hilda Solis. According to the letter, establishment of GRAs would end the tax breaks given to 401k accounts.
If you think GRAs are a good idea, think again. Oh, unless you’re in a union with an underfunded pension plan.
But why are unions pushing this? The average union pension plan is only 62 percent funded, far below the point at which the government considers a pension plan “endangered.” Estimates suggest unions’ multi-employer pension plans are underfunded by $165 billion and could be on the verge of collapse.
Union leaders see these “retirement security” ideas like GRAs as vehicles to a back-door pension bailout, where union leaders will no longer have to worry about the fact they’ve underfunded their rank and file members’ pension plans. Just let Uncle Sucker take care of it.
Labor is the biggest source of campaign cash for Democrats (Retirement USA backers AFL-CIO and SEIU are spending $88 million this election), and Harkin also wants to pass “card check” — the proposal to do away with secret ballots in workplace representation elections — during post-election lame duck session.
Regardless, forcing everybody into a government retirement system that pays out equally to Americans who have scrimped and saved and to those in organized labor who have grossly mismanaged their pension plans seems almost too crazy to contemplate.
Why do you think unions are spending so much on these mid term elections? They’d get a bailout that won’t be called a bailout. The Democrats will tell you they will be saving your retirement, when in fact they’ll be bailing out their union allies.