Tuesday, July 27, 2010

another panic

If there wasn't enough to panic about in the United States, give this a try:


To start with, this is not new even though it's being pushed as Obama's plot. The biggest push for it being a possibility was in 2008, before he got in power, as a way to scare Americans into not voting for him even though the idea has been pushed as much by Republicans as Democrats.

The fear talk goes along with the threat that Democrats want to socialize the entire country (Senator George Miller, the proposed bad guy said there is no such idea rolling around).

The Republicans claim that their idea of privatizing Social Security was really about just saving it... supposedly-- by turning its management all over to the corporations or government which we all trust so much.

What do you think? What are the odds this could be done and if you think it could, how would we stop it if it became popular with both parties? Would it require doing this: Dumping 401Ks, paying the taxes now to protect funds. Does somebody want us to think we have to do this to get the market to tank where they can scoop up huge profits?

Then there is this opinion with several links: Government and your IRA and 401K

For those who think this is about Obama, it's from further back as you can find information on it from 2005 or before. It became a huge push in 2008 when Obama was coming in. Some believe this rumor might explain the crash of the stock market.

To be honest, a person's first thought (right or left) is to cash it all in and pay the taxes if one seriously thought the government would take over its management.

The question is would the government (from either party) do such a thing? Would it be the end of all incumbents  if they did and then if a new group took over, how exactly would we trust them?

Anyway, what have you heard and what do you think about this possibility-- or not?

10 comments:

wally said...

According to PolitiFact.com that idea came from a speech given to the House Education and Labor committee on Oct. 7, 2008 by Teresa Ghilarducci, a professor of economic policy at New York's New School for Social Research. In the speech the professor said that the nation's 40lk program will leave more than half of it's participants without the necessary funds to retire. She recommended that the government end the tax breaks for the program and to establish new retirement accounts that would guarantee income for retirees. Although George Miller, the chairman of the committee, acknowledged the need for reform he in no way supported the call to eliminate the 401k program. Just another example to political distortion of the facts. http://www.politifact.com/truth-o-meter/statements/2009/apr/13/john-boehner/boehner-says-some-want-scrap-401ks/

Dion said...

I doubt the government will do anything with our 401(k) money. But there is worry if you are the worrying kind. Once the second wave of economic collapse hits and is coupled with increasing ecological disasters (2012?)... there will be diddly squat left in the 'Wall St Market'. Not sure anything we today call money will be worth anything. The survivors may be in such a pitiful state that even tried and true gold will hold little value.

Rain said...

Thanks for the link, Wally. Those are always helpful to expand the conversation.

And it definitely is a time with many 'ifs' ahead, Dion. Who knows what will happen. maybe it will all go on as it has been but that's generally not how it works in history.

Dion said...

'If' is the middle word in life.

Dion said...

Rain, When you look closely at the plants and trees with both eyes and heart, do you see their imminent demise? I see it and if the plants aren't surviving neither will my 401(k).

Rain said...

Nothing lasts forever. That's for sure; but I understand my 401k collapsing due to markets failing. The idea of the government taking it over, that I don't accept placidly. And my trust in gov't... left or right... is very limited...

Dion said...

Our government has morphed into an extension of the corporation. A symbiont Gov-Corp is America's master. Any trust of government I once held has been plucked from my lose grasp.

Kay Dennison said...

Frankly, I truly believe that if the gov't can find a way to rob us, it will.

Call me old and jaded but I gave up being Pollyanna a longggggg time ago.

Ingineer66 said...

You are correct Kay. A politician cannot stand to see a pot of money and not figure out a way to get their hands on it or at least get some control over it.
The California State retirement system is the largest in the nation and used to be managed primarily by non-political money managers. But it is so large the politicians have slowly attained more control over it. They invested in a bunch of questionable real estate transactions during the boom which now are costing the plan hundreds of millions of dollars. In the good old days they did not invest at all in real estate. Now Arnold his yelling as loud as he can that the system cannot stay solvent. If the politicians would not have put the golden goose on life support it would have been just fine.

Rain said...

One problem with state government pension systems, if they are like Oregon's, is that they promised a lot based on a very lush investment time. Everybody was making a lot in the stock market and they thought it would keep on laying golden eggs instead of eggs. The mistakes are easy to look back at now with assuming the housing market was not a bubble for instance, but they didn't see it and the promises are too much to live up to without either big tax increases, big cuts in everything else, or reneging on the promises. In some cases, those promises are legally locked in with promising pensions equal to what someone earned while actually working. I am not sure what the solution is although I do think they stopped promising so much for those who came later. That doesn't get them off the hook for those already getting that much and what do you do about it?