Walberg Takes Aim at Small Business Retirement Savings Plans

Congressman Tim Walberg (R-MI7) has his, so the rest of us can apparently go eat worms.

While Congressmen like Walberg become eligible for a Congressional pension after just five years of service, the rest of us have to scrimp and save to maybe be able to afford any kind of retirement. Thanks to relentless Republican policy making, pensions for the rest of us are all but gone, replaced with vehicles like 401(k)s that are OK if you can afford to put

anything into them, or IRAs that are equally hard to participate in.

Around the country, though, forward-thinking states and cities are trying to help. They understand that it’s in no one’s interest for seniors to be impoverished. According to Time magazine:

More than 30 states are in various stages of developing these savings plans, according to the Georgetown Center for Retirement Initiatives. The basic approach is to require any business that doesn’t offer retirement plans to auto-enroll workers in an IRA account, with contributions funneled from their paychecks into the investment vehicle. An IRA is a tax-advantaged retirement account. The worker may also choose to opt out.

These programs have been hailed by retirement experts as a great way to get more Americans to save. Only about half of U.S. private sector workers are covered by a 401(k) or similar retirement plan, leaving the rest, some 55 million Americans, without access to a workplace program. And without the nudge from an employer plan, most people fail to save—some 90% of those with a workplace plan save, vs. just 20% without one. Those who are left out tend to be lower-income and minority workers.

So, to recap. States and some cities are starting to require employers to auto-enroll employees into retirement savings plan, though employees do have the ability to opt-out. It’s not requiring employers to put a damned cent into them. The funds would come from the employee’s payroll.

Sounds great, right?

Not to Republicans, who seem to want us all sick and poor.

Republicans are seeking derail these initiatives through a rarely-used legislative maneuver called a Congressional Review Act (CRA) joint resolution of disapproval. This strategy can be used to undo regulations before 60 legislative days have gone by since they were published in the Federal Register. The two Republican-sponsored House resolutions take aim at U.S. Department of Labor rules designed to speed the adoption of state- and city-sponsored retirement savings plans.

“A CRA resolution can be a very effective tactic, since it can be passed by Congress with a simple majority and cannot be filibustered,” says Amit Narang, a regulatory policy advocate at Public Citizen’s Congress Watch. Once a CRA is passed, the agency that issued the blocked ruling cannot pass a substantially similar rule in the future unless it is reauthorized by Congress. In the case of auto-IRA plans, Congress has until mid-May to mid-June to act.

Why would they want to do this? Ask Michigan’s own Walberg, one of two Republicans leading the effort to make seniors poor again.

One resolution, sponsored by Rep. Tim Walberg (R.-Mich.), would block the Labor Department rule for state saving plans. Another, which would block it for cities, is sponsored by Rep. Francis Rooney, R.-Fla. In their statement, the Congressmen argue that, among other things, cutting the automatic savings programs would “reduce costly red tape.”

“This last-minute regulatory loophole created by the previous administration will lead to harmful consequences for both workers and employers,” Rep. Rooney said. “Hardworking Americans could be forced into government-run plans with fewer protections and less control over their hard-earned savings. Employers will face a confusing patchwork of rules, and many small businesses may forgo offering retirement plans altogether. Congress must act to protect workers and small businesses from these misguided regulations.”

“Our nation faces difficult retirement challenges, but more government isn’t the solution,” Rep. Walberg said.

Yeah, thanks. Jerk.

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