Obama Budget Would Cap Retirement Savings

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Congress is very unlikely to approve President Barack Obama’s recommended budget, submitted Wednesday after much delay.

But if the President got his way, Congress would cap the amount of money people could save in tax-preferred retirement accounts so that no account could earn an annual return of more than $205,000. As U.S. News reports, that means accounts that today hold about $3 million would have reached their savings limit under Obama’s plan.

While $3 million is a lot of money, it’s not as much as it used to be — and that trend is certain to continue. And, whether it’s an extravagant amount, for those who’ve managed to save the money or simply a cushion intended to last a retired family 20 or 30 years, it’s not the dollar figure that should raise eyebrows.

What’s sinister about the scheme is the way in which it reveals Obama’s liberal, regressive attitude toward capitalism and wealth. It stems from the punitive idea that those who earn a lot of money no longer need money as much as others do, and that it’s government’s job to redistribute it.

Obama said as much, telling a POLITICO reporter that “some wealthy individuals are able to accumulate many millions of dollars in these accounts, substantially more than is needed to fund reasonable levels of retirement saving.”

Where’s the incentive to enter the free market when the government is standing in line to confiscate the wealth you’ve worked for?

Personal Liberty

Ben Bullard

Reconciling the concept of individual sovereignty with conscientious participation in the modern American political process is a continuing preoccupation for staff writer Ben Bullard. A former community newspaper writer, Bullard has closely observed the manner in which well-meaning small-town politicians and policy makers often accept, unthinkingly, their increasingly marginal role in shaping the quality of their own lives, as well as those of the people whom they serve. He argues that American public policy is plagued by inscrutable and corrupt motives on a national scale, a fundamental problem which individuals, families and communities must strive to solve. This, he argues, can be achieved only as Americans rediscover the principal role each citizen plays in enriching the welfare of our Republic.

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  • Smilee

    Tax deferred is a joke, for some it is welfare and for others in ends up being a big tax burden. This is a very unfair method. Tax it in the year it was earned and then no tax when it is withdrawn would be the fair way. This bill only takes away welfare paid to the rich giving them another tax break at the rest of the taxpayers expense