Post by Darth Stateworker on Feb 23, 2012 1:00:30 GMT -5
In a word: money.
Many have seen my arguments. The largest is that the current Tier V plan over the long term has a lower projected employer contribution rate than either His Royal Highnesses Tier VI DC plan or the alternative presented by the Empire Center following a TIAA-CREF like model.
So if Tier V as it stands today is cheaper, WHY is the right (and lets face it, His Royal Highness IS on the right) arguing so vehemently by lying and stating that these DC plans will somehow SAVE money?
Answer: Because that’s what the Wall Street gods want.
The pension plan is pushing $150 billion in value currently. Currently, Wall Street gets basically nothing from it since it is for the most part managed in-house. Maybe they get a few million here or there, but nothing significant based on it’s size.
However, what happens if we move to a DC plan? Well, let’s look at your average, run of the mill 401k. Low fees to run a 401k plan for an individual generally cost them about 1% of the plan balance a year. Those with mid range fees might be 2% – 3%, and those REALLY getting robbed might be even 5%.
Now let’s think about that in terms of the pension plan for a moment. Wall Streeters currently get next to nothing from it. However, let’s say for arguments sake, the current plan was nothing but a DC plan now. At a current value of $150 billion, Wall Streeters would collectively stand to make $1.5 BILLION in fees this year at the low end of the scale and $7.5 BILLION at the high end.
Is it becoming clear here what’s going on and why a DC plan that long term will be more costly than the current DB plan we have under Tier V is so important? Is it becoming clear why they are willing to lie to change the narrative and claim at current rates, pension plans will “bankrupt” the taxpayers, even though the DC plan will in all probability cost the taxpayers more long term?
Ladies and gentleman, there’s your answer. Pure, unabashed greed a la Gordon Gekko is what’s driving this debate from those on the right. Well, at least it's what's driving the debate by the spin doctors on the right. For the rank and file right wing sheeple, they honestly believe that a DC plan will save money and that the current DB plan is one of the key factors affecting their taxes, misguided as they are - and no amount of facts or data will change that opinion. That's why they're sheeple.
If you read between the lines and use just a small amount of critical thinking about the narrative, you can see that the real reasons for this is that PENSIONS MUST DIE because for Wall Streeters, 401ks and other DC plans represent megabucks because of the fees they charge to manage them, unlike pensions, which are generally managed by the plan administrator and represent practically no profit for them.
THINK.
Many have seen my arguments. The largest is that the current Tier V plan over the long term has a lower projected employer contribution rate than either His Royal Highnesses Tier VI DC plan or the alternative presented by the Empire Center following a TIAA-CREF like model.
So if Tier V as it stands today is cheaper, WHY is the right (and lets face it, His Royal Highness IS on the right) arguing so vehemently by lying and stating that these DC plans will somehow SAVE money?
Answer: Because that’s what the Wall Street gods want.
The pension plan is pushing $150 billion in value currently. Currently, Wall Street gets basically nothing from it since it is for the most part managed in-house. Maybe they get a few million here or there, but nothing significant based on it’s size.
However, what happens if we move to a DC plan? Well, let’s look at your average, run of the mill 401k. Low fees to run a 401k plan for an individual generally cost them about 1% of the plan balance a year. Those with mid range fees might be 2% – 3%, and those REALLY getting robbed might be even 5%.
Now let’s think about that in terms of the pension plan for a moment. Wall Streeters currently get next to nothing from it. However, let’s say for arguments sake, the current plan was nothing but a DC plan now. At a current value of $150 billion, Wall Streeters would collectively stand to make $1.5 BILLION in fees this year at the low end of the scale and $7.5 BILLION at the high end.
Is it becoming clear here what’s going on and why a DC plan that long term will be more costly than the current DB plan we have under Tier V is so important? Is it becoming clear why they are willing to lie to change the narrative and claim at current rates, pension plans will “bankrupt” the taxpayers, even though the DC plan will in all probability cost the taxpayers more long term?
Ladies and gentleman, there’s your answer. Pure, unabashed greed a la Gordon Gekko is what’s driving this debate from those on the right. Well, at least it's what's driving the debate by the spin doctors on the right. For the rank and file right wing sheeple, they honestly believe that a DC plan will save money and that the current DB plan is one of the key factors affecting their taxes, misguided as they are - and no amount of facts or data will change that opinion. That's why they're sheeple.
If you read between the lines and use just a small amount of critical thinking about the narrative, you can see that the real reasons for this is that PENSIONS MUST DIE because for Wall Streeters, 401ks and other DC plans represent megabucks because of the fees they charge to manage them, unlike pensions, which are generally managed by the plan administrator and represent practically no profit for them.
THINK.
