EDITORIAL: Don’t throttle retirement plans
Exposing more income to taxation would generate more dollars for
Doing so, however, would make it much harder for Americans to save for their retirement. Indeed, it would be a gut punch to workers who have suffered years of stagnant wages and struggled to balance paying their current bills with setting aside enough for their futures.
It also would violate an implicit deal between employers, employees and the government. Since the 1980s, defined-contribution 401(k)s have largely replaced traditional defined-benefit pensions in the private sector. Businesses increasingly preferred to avoid the long-term financial liability of a pension by matching their employees' regular contributions to a 401(k) -- in effect, "free money" for their retirement. In exchange, the government refrained from taxing those savings until they were withdrawn years later at retirement.
That arrangement largely has been beneficial to companies, which aren't saddled by legacy costs of pensions far into the future; to workers, who own their retirement accounts and can control how much they put it in, and how to grow it; and to the economy, which grows from having all those tax-deferred dollars in managed plans invested into markets. That in itself creates taxable wealth.
If
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If the
President
Hopefully that's one principle that is non-negotiable. If public opinion doesn't dissuade
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