Goldman Sachs and AIG Team Up on the US Taxpayer
Goldman Sachs, AIG, and other large Wall Street firms have been contributing massive amounts of money to the Democratic Party, including President Obama and most of the senior leaders in the Senate and the House. Until recently, it was believed that the purpose of these contributions was to prevent the government from passing regulations which would damage the American financial services industry.
It turns out that the sharks of Wall Street have larger goals, and those goals are finally coming to light. Goldman Sachs, AIG, and a loose consortium of other large finance firms are putting pressure on the Obama Administration and Congressional Democrats to force Americans to invest in retirement annuities — financial packages which are offered by very very firms. In effect, they are paying the politicians to create customers for their services.
The 401k and IRA plans allow Americans to choose how their retirement savings are invested. This allows the owners to determine the level of risk (and possible reward) which they wish to pursue. Annuities, in contrast, offer a fixed return on investment — as long as the company offering the annuity remains solvent.
The Obama Administration has directed the the U.S. Treasury and Labor Departments to develop plans to promote the conversion of 401k and IRA accounts into the annuities offered by the large campaign donors. The Treasury Department effort is being led by Assistant Labor Secretary Phyllis C. Borzi and the Labor Department effort is being led by Deputy Assistant Treasury Secretary Mark Iwry. Borzi openly admits that her efforts are the result of political direction from the Obama Administration, saying that there is “a tremendous amount of interest in the White House” in retirement-security initiatives.
In addition to pressure from the executive branch, the Senate’s Special Committee on Aging is scheduled to hold hearings on this issue on 16 June. The Senators on this special committee are:
Democrats
- Herb Kohl, Chairman (Wisconsin)
- Ron Wyden (Oregon)
- Blanche Lincoln (Arkansas)
- Evan Bayh (Indiana)
- Bill Nelson (Florida)
- Bob Casey (Pennsylvania)
- Claire McCaskill (Missouri)
- Sheldon Whitehouse (Rhode Island)
- Mark Udall (Colorado)
- Michael Bennet (Colorado)
- Kirsten Gillibrand (New York)
- Arlen Specter (Pennsylvania)
- Al Franken (Minnesota)
Republicans
- Bob Corker, Ranking Member (Tennessee)
- Richard Shelby (Alabama)
- Susan Collins (Maine)
- Orrin Hatch (Utah)
- George LeMieux (Florida)
- Sam Brownback (Kansas)
- Lindsey Graham (South Carolina)
- Saxby Chambliss (Georgia)
Having the government promote or mandate the purchase of annuities will represent an enormous windfall for these companies — probably much larger than all of the taxpayer money they have received in the last few years. Americans currently hold approximately $3.6 trillion dollars in retirement funds and those numbers represent huge potential profits for a very limited number of firms.
More insidiously, each of those firms would then automatically become “too big to fail.” In an annuity arrangement, payments are fixed. This means that all risk is absorbed by the company offering the annuity — except that we all now know that the U.S. government would never allow a company to fail when that failure would risk the retirement incomes of ordinary Americans. In effect, these companies are not only buying themselves guaranteed business, they are also buying themselves guaranteed protection against business failure. In light of these benefits, their recent campaign contributions appear to be very smart business decisions.
P.J. O’Rourke once quipped “When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.” It seemed funny then; it doesn’t seem so funny now.
I am keeping a close eye on this to protect MY private savings from being seized in the Obama plan to use US citizens’ personal savings and investments to bail out our country. This whole idea is nothing more than a money grab for our greedy, money-hungry government who doesn’t know how to save and balance budgets.
Why should I save all my life for my own retirement to let them yank it out and force us to put it in worthless investments that have NO guarantee of being there when I need it? This is ridiculous and I am contacting each person listed in the article to tell them so.
Americans who have invested in IRAs and 401(k)s are smarter than our government gives them credit. They won’t pull the wool over our eyes by sensationalizing the poor market and offering a so-called guaranteed annuity.
Did you know Swiss annuities are the only annuities in the world to never have failed? They govt. makes the annuity holders have the funds in escrow to guarantee them. The US Govt. doesn’t do that. So, where’s the guarantee?????? This is nothing more than another social security plan doomed to fail from the get-go—and at the expense of hardworking, life time saving Americans who chose to invest for their own retirements and futures. NO TO THIS B.S.
Here is a link to the Senate Special Meeting video online for anyone interested. My general summary of it is that our govt. is trying to promote and get people to voluntarily start buying annuity or “guaranteed lifetime income” type products. This video states outright they are not seeking or trying to “mandate” anything in this direction, but quite frankly, I don’t believe it for a minute.
Does anyone else wonder WHY our government is suddenly so concerned about promoting annuity type products to American investors? We can buy annuities NOW if we want them–so why all the meetings and talks to figure out the best way to sell the idea and “educate” us about them. In fact, Borzi states in this video that they want to start educating in the schools at the elementary age. Here is the link to the video.
http://aging.senate.gov/hearing_detail.cfm?id=325713&
After much digging I also found links to S2832 “Restoring American Financial Stability Act”, S1661 “Senior Investor Protection Act” and HR 4173 “Wall Street Reform & Consumer Protection Act 2009″ that have references to this very subject. Go to this link and then be sure to follow the 3 links within this article to view A LOT MORE INFO about all of this and where it is headed. These will lead you to the different legislation regarding our IRA and 401k retirement savings and how the govt. is trying to slowly weedle its foot in the door.
http://aging.senate.gov/hearing_detail.cfm?id=325721&
Statements like this CAN BE FOUND AT ONE OF THESE LINKS:
Said David John, Senior Research Fellow at the Heritage Foundation and Principal of the Retirement Security Project: “Sometimes a simple common sense change has the biggest effect. Including a disclosure of how much monthly income a worker can expect from 401(k) savings will encourage younger workers to save more for retirement, and older ones to convert their savings into annuity-like products so that they won’t outlive their savings. The Act will build greater retirement security for everyone at virtually no cost to the taxpayers, employers, or workers.”
Hmmmm….Create the fear and people will voluntarily do whatever they want! Who needs who here? I’d say the govt. needs the nearly 15 trillion dollars that our age 65 and over population has in assets.