Income and Wealth Redistribution
Democrats in the U.S. House have been conducting hearings onproposals to confiscate workers’ personal retirement accounts —including 401(k)s and IRAs — and convert them to accounts managed bythe Social Security Administration
Triggered by the financial crisis the past two months, the hearingsreportedly were meant to stem losses incurred by many workers andretirees whose 401(k) and IRA balances have been shrinking rapidly.
The testimony of Teresa Ghilarducci, professor of economic policyanalysis at the New School for Social Research in New York, in hearingsOct. 7 drew the most attention and criticism. Testifying for the HouseCommittee on Education and Labor, Ghilarducci proposed that thegovernment eliminate tax breaks for 401(k) and similar retirementaccounts, such as IRAs, and confiscate workers’ retirement planaccounts and convert them to universal Guaranteed Retirement Accounts(GRAs) managed by the Social Security Administration.**In a radio interview with Kirby Wilbur in Seattle on Oct. 27, 2008,Ghilarducci explained that her proposal doesn’t eliminate the taxbreaks, rather, “I’m just rearranging the tax breaks that are availablenow for 401(k)s and spreading — spreading the wealth.”
Income and Wealth Redistribution
The majority of witness testimony during recent hearings before theHouse Committee on Education and Labor showed that congressionalDemocrats intend to address income and wealth inequality throughredistribution.
On July 31, 2008, Robert Greenstein, executive director of the Centeron Budget and Policy Priorities, testified before the subcommittee onworkforce protections that “from the standpoint of equal treatment ofpeople with different incomes, there is a fundamental flaw” in tax codeincentives because they are “provided in the form of deductions,exemptions, and exclusions rather than in the form of refundable taxcredits.”
Even people who don’t pay taxes should get money from the government,paid for by higher-income Americans, he said. “There is no obviousreason why lower-income taxpayers or people who do not file incometaxes should get smaller incentives (or no tax incentives at all),”Greenstein said.
**This plan makes sense: the majority of retirement accounts are held by European American baby boomers and those who came after the boomers. Blacks, Hispanics and some lazy white Americans will benefit profusely…all in the name of votes and “equality.”