Barack Obama and the Democrats' Plans for Nationalized Healthcare and Ending 401(k)'s Will Bring Back the GOP

Are Democrats really thinking of ditching 401(k)'s? Are they that dumb? Yes.

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If Sen. John McCain or some of his high-level campaign staffers knew how to run a presidential campaign, they would have turned information such as this, presented by my U.S. News colleague James Pethokoukis, to voters, combined with Senator Obama's "spread the wealth around" comment. If they had, McCain's poll numbers would look a lot better than they do at this late date.

Yes, too many Americans (unfortunately, in my view) want nationalized healthcare. Yes, they want Social Security to be made fiscally sound. But do they want Daddy Government to reach this far into their beloved 401(k) retirement plans and wreak fiscal havoc? Methinks not. Jimmy P. reports:

House Democrats recently invited Teresa Ghilarducci, a professor at the New School of Social Research, to testify before a subcommittee on her idea to eliminate the preferential tax treatment of the popular (401 (k)) retirement plans. In place of 401(k) plans, she would have workers transfer their dough into government-created "guaranteed retirement accounts" for every worker. The government would deposit $600 (inflation indexed) every year into the GRAs. Each worker would also have to save 5 percent of pay into the accounts, to which the government would pay a measly 3 percent return. Rep. Jim McDermott, a Democrat from Washington and chairman of the House Ways and Means Committee's Subcommittee on Income Security and Family Support, said that since "the savings rate isn't going up for the investment of $80 billion [in 401(k) tax breaks], we have to start to think about whether or not we want to continue to invest that $80 billion for a policy that's not generating what we now say it should.

Puh-leeze, just how stupid do Democrats think each one of us is? I can see it now, President Obama and the "tax and spenders" in Congress will seize victory and turn it immediately into disaster by raising taxes, reinstating the inheritance tax, and nationalizing healthcare. (OK, I won't call it "socialized" healthcare.) Thereby they will catapult middle-income Americans and independent voters into a speed run back into the GOP camp—a re-creation of the so-called Reagan Democrats of the 1980s. Didn't they learn from their congressional losses in 1994? Didn't they learn from having to swallow eight years of the most incompetent White House governance we've ever seen (George W., that is.) Apparently not. In fact, apparently not at all.

  • Click here to read more by Bonnie Erbe.
  • Click here to read more by James Pethokoukis.
  • Click here to read more about 401(k)'s.