A pre-emptive strike at the AmeriSave plan

Word on the street is that the Democrats’ long-awaited agenda will include their “plan” for retirement “security” dubbed AmeriSave. Only it’s not really a plan. Instead, it’s main purpose is to suggest a patina of responsibility while providing a token counterpoint for real Social Security reform.

As the Heritage Foundation notes, the program has some good points, mostly the provisions that helps workers to set up their own IRAs and 401(k) accounts. But the heart of the AmeriSave scheme is that the government would match $1000 for workers who invest in these plans. No details are given as to how the government would pay for this matching, but I think Bastiat’s Window sees through the Democrats’ plan:

Begin at the beginning: If the government is going to give Worker A an extra $1,000 entitlement, then that $1,000 has to come from somewhere else. Some possibilities: It can raise Worker A's taxes by $1,000 to fund his own $1,000 government match. That may sound perverse, but that never stopped the government before. And of course it would do nothing to increase Worker A's savings.

The other scenarios include taking a grand from Worker B and giving it to A and hoping that Worker A will vote Democratic.

The most outrageous aspect of AmeriSwindle is that it offers nothing – absolutely nothing – to address the Social Security crisis looming over this country.

Even if Democrats were serious about this AmeriSave business, Social Security's current trust fund surplus would still become a deficit in 2017, Social Security would still be unable to pay its promised benefits beginning in 2041, we'd still see the same miserable rate of return on the 1 out of every 8 or so dollars we earn that goes toward Social Security, and Social Security would still have an unfunded long-term liability of 11 trillion dollars.

AmeriSave is just a cynical and irresponsible ploy to give the appearance of action without actually having to address the real crisis. You’d think the Democrats would be ashamed to dangle another “free money” scheme in front of Americans, but it’s the only tool in their box.