Tuesday, David Asman of Fox Business Network talked about the diversion of our 401Ks and IRAs by the government. I heard rumors of this before but did not think it would actually happen. We are a nation of savers and our elected representatives, while not always truthful, would not so blatantly steal our money. I thought about the possibility that our government might confiscate our retirement assets after Argentina nationalized private pension plans in 2008. Now Senators Jeff Benjamin and John Kerry have introduced a bill called the Automatic IRA Act of 2010. Under this act, employers that do not offer a 401(k) or Simple Employee Pension would be forced into this plan or face fines. The default investment vehicle for employees would be the principal preservation fund, which will invest in the R-bond. These new bonds would be issued by the Treasury to fund government debt and spending excesses.
This is another attempt by the government to confiscate assets from the general public. We are already required to contribute to Social Security and our employers are required to contribute an equal amount or higher on our behalf. For decades, Congress has raided the Social Security Trust Fund to pork barrel their way to reelection. You, me and our employers paid into Social Security for our entire working lives. This year, for the first time, Social Security will pay out more to recipients than it will receive in contributions. The declining economy hit Americans approaching their golden years hard as they lost their jobs. Many opted to take Social Security early rather than searching for non-existent jobs in a bad economy. After all, they might was well get some of their money back before the government declares bankruptcy!
Despite all of the comments you may have read about Social Security being solvent until 2037, I believe that the cash in the Social Security Trust Fund has been spent by Congress and replaced with government IOUs. Our elected representatives have raided the Trust Fund, diverting over $2 trillion to fund an ever-growing budget deficit. Bernie Madoff went to jail because he diverted funds from his investors. His $50 billion Ponzi scheme is called the largest scam in history. Obviously the authorities overlooked the $2 trillion our elected representatives diverted from Social Security. (http://www.bloomberg.com/news/2010-08-25/retiree-ponzi-scheme-is-16-tril... ). While their actions may have been legal, misappropriating over $2 trillion from the general public is despicable.
There is compelling evidence that the government wants to hijack our retirement plans (http://moneymorning.com/2010/01/27/retirement-plans/ ). We have trillions of dollars sitting in personal retirement accounts that the government believes should be invested in low interest government bonds. Instead, the politicians need to stop spending, get their fiscal house in order, and start serving the people. They cannot use our retirement plans as their personal piggy banks.
We must stop congress before they pass further legislation to steal our nest eggs. We did not invest for decades so that the government could walk off with our savings as we enter our golden years. We invested in our IRAs because we knew Social Security would not be there for us. Now that we have accumulated trillions of dollars in our plans the government wants it and is ready to seize it. It is time for each of us to contact our representatives to ensure they vote against the Automatic IRA Act and any other legislation that pilfers our savings.
Paul Cwik takes a different angle from me regarding Social Security. He uses present value of money calculations to show that Social Security is a bad investment (http://mises.org/daily/4595 ). Even George W. Bush (do you miss him yet?) knew that the answer to saving Social Security was permitting individuals to invest part of their Social Security accounts themselves. This was brilliant. So why did his idea not stand a snowball's chance in Hades? Simply because it would deny the members of Congress, Republicans and Democrats, the opportunity to spend all of our retirement savings on their bridges to nowhere or an airport no one needs (John Murtha Airport).
Many of us are going to Washington today to ensure that government hears our voice. Hundreds of thousands of people like you and I will stand with Glenn Beck as we attempt to restore our country on 8/28. I find it amazing that so many of us are prepared to travel from all parts of this country to stand and be counted, to preserve our Constitution, and to ensure our people remain free. If you are not going to DC today, please think of us at 10 a.m. as we assemble in front of the Lincoln Memorial. We know what is right and we want our elected officials to understand that we are watching their actions. Our representatives will know that the people have had enough. We are willing to travel hundreds or thousands of miles to ensure that they know exactly how we feel. In the coming election, they will not be able to buy us off with pork. Instead, they will have to offer us an honest, decent government that lives within its means.
If you are interested, you can view David Asman's video comments at http://video.foxbusiness.com/v/4320117/government-looking-to-take-over-y... .
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