The United States isÂ heading for a major retirement crisis, with the shift from pensions to 401(k)s leaving at least half of households in danger of running short of money in retirement. There are a lot of possible solutions to that, andÂ one of them doesnâ€™t even involve employers paying their workers more:
What if people who wait tables, wash cars, take care of children, or perform other low-wage jobs for small businessesâ€”which often donâ€™t offer 401(k) savings plansâ€”could have money taken out of every paycheck and deposited into a low-cost retirement savings account operated through the state government? Five states have enacted plans that are making this possible, and 28 states are at various stages of considering such plans. If all of these states did enact these laws,Â 63 million people could have access to retirement savings options.
This was the goal of the Obama administration, whichÂ put in place regulationsÂ to help states that wanted to provide retirement savings options. Though some states had set out on this path before, this new policy that made it easier and safer for states to offer these plans, paved the way for this positive development in the states. This was great news for millions of workers! Make it easy for people whose employers donâ€™t offer retirement savings option to do the responsible thing: put away money every month toward their retirement in a way that limits the amount of their savings that is lost to fees and commissions. It helps people prepare for their old age. It chips away at a looming retirement crisis. Whatâ€™s not to like?
You know where this is going, right? Of course you do. Republicans donâ€™t like it because of this part: â€śin a way that limits the amount of their savings that is lost to fees and commissions.â€ť Those fees and commissions donâ€™t vanish into thin air, they go into the bank accounts of rich people. Plus, letting workers save their own money toward retirement creates a little extra work for employers, and there are a lot of crappy bosses out there whoâ€™d rather not bother, even if it means their workers will suffer in retirement. So the regulation helping states offer this retirement option is one more regulation being slashed by congressional Republicans.
This article originally appeared at DailyKOS.com on February 25, 2017. Reprinted with permission.
Laura Clawson is aÂ Daily Kos contributing editor since December 2006. Labor editor since 2011.