patrick.net

"Automatic enrollment and payroll deduction are powerful tools that help people save, she says, because people don't tend to miss money they don't see."

The confiscation of wealth begins in California

LMFAO!!!

"she says, because people don't tend to miss money they don't see."

Bitch when you live check to check and inflation out strips wage increases for 22 years straight WTF are you supposed to SAVE !

Now you have NO CHOICE!

California STATES THIEVES

Don;t worry Californian TAX Slaves "Enrollment won't begin until 2015, at the earliest"

LEAVE NOW!

"The California Chamber of Commerce argued that the plan was unnecessary"

Tnew law authored by de Léon attempts to address what he calls the coming "retirement tsunami." Signed by Gov. Jerry Brown in September 2012, the California Secure Choice Retirement Savings Program would establish automatic payroll contributions into retirement accounts for 6.3 million Californians whose employers don't sponsor a pension plan or a 401(k). Legislators in left-leaning states such as Connecticut and Illinois have put forward similar proposals, as has U.S. Sen. Tom Harkin (D-Iowa).

They are confiscating your money, you will NEVER EVER SEE IT!

Well if the state didn't take it your landlord would.

A fool and their money are soon parted. If they let the state take their money so be it. They don't deserve to have it or ever see it again no ways!

I like the idea of encouraging or forcing people to save for their retirement. But having the gov't (especially California state gov't) implement this will already add yet more layers of gov't workers/waste, and highly doubt they could bang out a reasonable/feasible solution.

No matter how poor people are, you can always save SOMETHING. I don't buy the excuse that people are too poor to save for retirement.... Between section-8, EBT cards, food stamps, welfare, fuel assistance, obama-phones, etc, there is zero excuse nowadays NOT to save for retirement. I see folks driving cars worth 3x-4x than my car, on welfare or some assistance, and they claim they can't save for retirement. Bullshit.

I just think California would fuck it up, like it has w/ most decisions....

puhim says

Law to be passed to force Califronian's to be enroll in pension plans that deduct 3%.

puhim says

"The new system would deduct an automatic 3 percent contribution from the paychecks of eligible employees, unless they chose to opt out.

So opt out - problem solved.

New Renter says

puhim says

Law to be passed to force Califronian's to be enroll in pension plans that deduct 3%.

puhim says

"The new system would deduct an automatic 3 percent contribution from the paychecks of eligible employees, unless they chose to opt out.

So opt out - problem solved.

When the NJ teacher's union was getting the crap beat outa them by Chris Christie, they could have fought any number of new policies the governor was instituting on teachers (increased medical contribution, wage freezes, reducing state aid). They fought none of it. The only thing they fought that year was an opt out option from the pension system. Nearly all pension systems would go insolvent without forcing people to participate. Outside of the people milking the system, they are poorly managed and most of the managers specialize in making bad decisions.

Nearly half of Californians are on track to retire in or near poverty.

If California had the stones like Wisconsin's Guv did last summer in defeating the democrat-Unions, California can avoid the same fate as Detroit... Luckily, California has a lot more going for it than Detroit.

However, Democrats in California have declared open-season on its law-abiding tax payers. Sucks to be them....

The main problem with pension funds in general, whether state-based or private, is the propensity for the funds to "invest" the fund holdings with hedge funds and private equity funds (a.k.a leveraged buyout firms) who are actively seeking to profit from destroying the very corporations that the pensioned workers are employed by.

THAT is the real problem.

justme says

The main problem with pension funds in general, whether state-based or private, is the propensity for the funds to "invest" the fund holdings with hedge funds and private equity funds (a.k.a leveraged buyout firms) who are actively seeking to profit from destroying the very corporations that the pensioned workers are employed by.

THAT is the real problem.

That's one part of it. The other part is that if they invest in safest vehicles only and adjust the payouts for shortfalls, and inflation pretty much eats up a good chunk of the yield, then the old mob will riot for their "guaranteed" yields and gladly take it from the kids. But hey, inflation is good says the Fed and the NAR ;)

"And businesses with more than five employees that fail to allow payroll deduction would pay a penalty of $500 per eligible employee"

And California's assault on small business continues...

I see a bunch of fat bureaucrats smoking cigars in Texas reading this and joking to themselves, "here comes another wave of businesses headed our way from Cali haha"

bgamall4 says

puhim says

The confiscation of wealth begins in California

Well, I don't know. Giving your employee a pension is not confiscating wealth, it is doing the right thing.

Why do you enjoy lying?

bgamall4 says

puhim says

The confiscation of wealth begins in California

Well, I don't know. Giving your employee a pension is not confiscating wealth, it is doing the right thing.

BG,

I agree. As far as symantics go, the workers aren't 'given' anything. They are forced to use 3% of their own earnings to go into the retirement plan. However, JustMe and Mell bring up other great points. It's how Cali would come up w/ the solution. ....Being the 'Even-Steven, Steady-as-she-goes Dividend Growth Investor that I am, I'd like to see a simple fund of 20 dividend paying stocks used for this fund. This is how a portion of the "1%-ers" Trust Funds are funded; why not set up something similar for the average/poor person?..... And finally, the person does have the option to 'opt-out'. To me the default would be to 'opt-out'.. ie, doing something to get INTO the plan, if one chooses...

The problem is not the plan, it's that California government would be controlling it. Contributors would have no rights to their own money, and what isn't stolen or lost in stock market crashes would be eventually legislated to go solely to illegal immigrants. Having witnessed ten years of California politics, I have zero faith in the system, especially now that democrats control everything in government. I'll probably get the hell out in five years or so.

bgamall4 says

dodgerfanjohn says

Why do you enjoy lying?

I am not lying. Confiscating wealth would mean that the government gets the money. I don't see that happening.

Eeesh....the one American who trusts politicians.....

bgamall4 says

I am not lying. Confiscating wealth would mean that the government gets the money. I don't see that happening.

Dumbass

Quigley says

The problem is not the plan, it's that California government would be controlling it. Contributors would have no rights to their own money, and what isn't stolen or lost in stock market crashes would be eventually legislated to go solely to illegal immigrants. Having witnessed ten years of California politics, I have zero faith in the system, especially now that democrats control everything in government. I'll probably get the hell out in five years or so.

Exactly. Thanks for spelling it out for the dumbasses here.

bgamall4 says

I am not lying. Confiscating wealth would mean that the government gets the money. I don't see that happening.

You you fool, don't you realize these people will never ever see that money EVER!

you're 401k/Govt pensions are all BULLSHIT , you will never see them

All pensions will be confiscated or CONVENIENTLY LOST!

puhim says

Quigley says

The problem is not the plan, it's that California government would be controlling it. Contributors would have no rights to their own money, and what isn't stolen or lost in stock market crashes would be eventually legislated to go solely to illegal immigrants. Having witnessed ten years of California politics, I have zero faith in the system, especially now that democrats control everything in government. I'll probably get the hell out in five years or so.

Exactly. Thanks for spelling it out for the dumbasses here.

Agreed - that's the big red flag here. To be fair it works well enough in some other countries, but then again, those don't allow robbing the fund money and taking high risk gambles, neither do they bail out crony capitalists on such an unprecedented level or let everyone walk free if they just plead "da fif" when they have lost billions in what was supposed to be untouchable client account money. At this point almost all trust is gone, and rightfully so, at least until we see handcuffs (for bankstas, RE agents and politicians) for all the fraud committed.

I don't see why everybody is up in arms about this after seeing what a huge success social security has been.

The government is going to make us all millionaires!!

Also Chuck Reed is a shit eating crony that doesn't understand economics one bit.

epitaph says

I don't see why everybody is up in arms about this after seeing what a huge success social security has been.

The government is going to make us all millionaires!!

Oh you mean like this!

http://www.fedsmith.com/2012/12/30/using-the-g-fund-to-help-fund-federal-expenses/

Using the G Fund to Help Fund Federal Expenses

During the Christmas holidays, everyone gets preoccupied with the events surrounding friends and family and the spirit of the season.

While New Year’s day isn’t until next week, those that invest in the G fund for their current or future retirement always find it of interest when there is a debate about raising the debt ceiling. The reason: The federal government has to come up with money until the debt ceiling is approved. Your G fund investments will help fund the government while our elected representatives haggle and debate over what to do about the ever increasing debt and the need to, yet again, increase the amount of debt that can legally be incurred by the government.

The Treasury recently announced a series of measures that will delay the day the government will exceed its legal borrowing authority as imposed by Congress. These steps could delay the inevitable for up to two months depending on how much the government spends each day beyond what it takes in during that time.

One of these first measures to be taken by the Treasury Department is to suspend investment in the G fund and, presumably, the Civil Service Retirement and Disability Fund. According to Treasury Secretary Timothy Geithner, these steps, including suspending investments in the G fund, “can create approximately $200 billion in headroom under the debt limit.”

How Much Are We Borrowing?

On December 12, 2012, the US Treasury Department reported that the federal Government had a budget deficit of $172 billion for the month of November, an increase of 74.8% over the monthly budget deficit for the prior year. With total outlays of $334 billion for the month, this means the government borrowed 51.6 cents for every dollar it spent.

The federal government is currently allowed to borrow up to $16.4 trillion dollars and we will reach that number in the next few days. The Constitution provides that borrowing money requires congressional action. In Article I, Section 8, Congress is granted the power “to borrow money on the credit of the United States.”

The Obama administration has proposed to give the power to the president to borrow the amount of money he considers necessary. No doubt, any attempt to eliminate Congress from this process, as has been suggested by some who would prefer that the president incur additional debt without Congressional approval, will trigger a new political debate and eventually end up in court if there is no political solution reached.

To put the current level of government spending into perspective, the Office of Management and Budget (OMB) figures show that in 2007 , the year before the last recession took hold, federal receipts were $2.568 trillion. Expenses totaled $2.728 trillion. The estimated receipts for 2012 are $2.468 trillion or about $100 billion less than in 2007. The real problem is how much we spent. The government will spend about $3.795 trillion in 2012 or more than $1 trillion than we spent in 2007.

The 2012 $1.1 trillion deficit was $953 billion (in inflation-adjusted dollars), or 547 percent greater than the pre-recession deficit in 2007.

The deficit spending has been as much as $1.4 trillion in 2009 and has exceeded $1.2 trillion each year from 2009 – 2012. That rate of spending is obviously the reason we keep hitting the debt ceiling every couple of years.

For those with an interest, here are the figures from the Office of Management and Budget:

Year Receipts Outlay Deficit
2007 2,567,985 2,728,686 -160,701
2008 2,523,991 2,982,544 -458,553
2009 2,104,989 3,517,677 -1,412,688
2010 2,162,724 3,456,213 -1,293,489
2011 2,303,466 3,603,061 -1,299,595
2012 estimate 2,468,599 3,795,547 -1,326,948
2013 estimate 2,901,956 3,803,364 -901,408
We know from past experience that the Treasury Department can use some retirement funds of federal employees to avoid increasing the debt limit which is capped by law. That is likely to happen again if the debt limit is not raised by Congress.

Your G Fund and Previous Debt Ceiling Limits

When this is done, here is what happens to some of your retirement funds:

“In these circumstances, the Secretary of the Treasury is authorized to

suspend the investment of amounts in the Civil Service Retirement and Disability Fund that normally would be invested in interest-bearing Treasury securities;
sell or redeem Treasury securities held by the CSRDF prior to maturity; and
suspend the issuance of interest-bearing Treasury securities to the “G” fund of the Thrift Savings Plan.”
Why is the G Fund Different Than Other TSP Funds?

The Thrift Savings Plan (TSP) is similar to employer-sponsored “401(k)” plans in the private sector. The Thrift TSP consists of individual accounts owned by employees and former federal employees who participate in the plan. Your contributions to the TSP and contributions made by your employing agencies are credited to a deposit fund in the Treasury Department.

Here is where the G fund is different from the other TSP funds. The “G” fund – is invested in interest-bearing Treasury securities that comprise part of the public debt. In fact, this is the reason that the G fund is often described as an extremely safe, conservative investment for federal employees. The securities that are in the G fund are issued to that fund–the Treasury securities in the G fund are short-term securities that are not available to the general public.

On the other hand, since the G fund becomes part of the trillions of dollars in debt held by the federal government, a portion of the G fund becomes part of the accounting procedures used to avoid increasing the debt limit.

The Long Term Impact on Your G Fund

Previously, G fund investors have not been harmed by actions taken by the Treasury. We do not anticipate there will be any long term harm to G fund investors in this round of negotiations either. No doubt, despite the history of everything coming out well in the end, the fact that federal employee retirement investments are used as part of the process makes many current and retired federal employees uncomfortable.

Moreover, with each new round of negotiations, the problem is much worse than it was previously.

When the debt ceiling limit was last raised in 2011 the debt ceiling went from $14.29 trillion to more than $16.39 trillion. We don’t know what the next debt ceiling will be, perhaps as much as $20 trillion or so. Of course, the federal government pays interest on the money that it borrows. While interest rates are currently at historically low levels, largely as a result of the Federal Reserve printing money and buying much of the debt, in 2011, these interest payments claimed $230 billion, or about 6 percent of the budget. Since the government is printing a large amount of money each month which is then used to purchase the government debt, there are inflationary pressures building in the economy. When or how large the ultimate inflation will be remains to be seen. But, when interest rates do finally go up, the amount of money spent by the government to finance the debt will go up rapidly.

In short, the current debt ceiling debate is only part of the problem. And, in addition to the pay freeze that has been in effect, federal employees are also helping with the problem through the involuntary use of G fund as explained above.

puhim says

We know from past experience that the Treasury Department can use some retirement funds of federal employees to avoid increasing the debt limit which is capped by law.

Oh and by the way the next round of borrowing by the government is going to cost an extra $1 Trillion for every 0.25% above the rate from 2011.

Government debt payments might exceed 10% of the budget

This will create a whole new round of AUSTERITY!

puhim says

While interest rates are currently at historically low levels, largely as a result of the Federal Reserve printing money and buying much of the debt, in 2011, these interest payments claimed $230 billion, or about 6 percent of the budget.

bgamall4 says

No problem with that. You saw, however, the fellow that is predicting dow 5000. Burnham is his name I think.

Meh... For every prediction for Dow hitting 5000, there's another one for 20000. The companies I invest in, are free cash flow machines. They generate revenue during recessions, depressions, world wars, oil embargoes and crisis', flash crashes, and the occasional impeachment. Stock prices will rise and fall, but my dividend checks will get bigger, and still get delivered to my mailbox like clockwork...

...and if you don't live long enough to collect benefits who gets the money ?

Yeah and they will end up doing it on a national scale when they realize social security is broke, the treasury is broke and no one will buy US treasuries unless its mandatory

http://smaulgld.com/mandatory-retirement-accounts/

"Confiscating wealth would mean that the government gets the money. I don't see that happening"

If a thief steals money and gives it to his friends and doesn't keep any of it, is it still theft?

"...and if you don't live long enough to collect benefits who gets the money ?"
back to Ceasar I would guess

Bubbabear says

.and if you don't live long enough to collect benefits who gets the money ?

Your designated beneficiary, just like on a 401K, I would think.

zzyzzx says

Bubbabear says

.and if you don't live long enough to collect benefits who gets the money ?

Your designated beneficiary, just like on a 401K, I would think.

Same with army veteran benefits. Spouse gets them.