401 Ks helping create inequality

Liberty said:
I don't look at it from the eyes of a marxist. I look at it through the eyes of liberty, and the creation of opportunity.
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Yea, well I suggest you look at it through the eyes of what has actually happened in the past instead of through the paradigm of empty catch phrases.
 
Mott the Hoople said:
I agree, times have changed. Companies though have to offer comprehensive benefits if they are going to find and retain talent. For example, since I've been with my current employer I have been offered positions that would have paid a higher salary than what I currently earn but when total compensation is calculated, that is my current benefit package compared to what the other companies were offering, my total compensation with my current employer was higher. So I didn't accept those offers.

Education will be the key to most Americans retaining a viable middle class life style. However, the current gross inequalities that we are seeing in our nation cannot continue to grow. The people who are producing that wealth are going to expect the top 1% to share more of that increased wealth from increased productivity instead of taking virtually all of it. The current inequities just simply aren't tenable. One only has to study history to see what will happen.

Having said that, it won't be people like ILM and Piss who affect that change. Mouth breathing redneck trailer trash aren't the people doing the producing. It's the skilled trades and professional classes that will force those changes cause thier the ones responsible for most of the increased productivity and they're the ones being screwed the most.
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What? You want higher compensation? Isn't that greedy?

Funny when a business wants higher profits they are greedy in your eyes. But when you want more money you are just "getting yours"
 
Mott the Hoople said:
But that's just a straw on the back of what the real cause of inequity in our nation is. Labor has lost huge amounts of power since Reagan. Since the 70's we've seen huge increases in worker productivity. GNP had nearly quadrupled since then. Virtually none of that increased wealth from increased productivity has gone to workers who do the lion share of creating that productivity and wealth. Virtually all of it has gone to the top 1%. In fact wages have been stagnant and when adjusted for inflation median household incomes have not risent since the 70's. Actually they've gone down by about 40% because many women have been forced to enter the work force in households that have traditionally been single earner households. They've had to to make up for the loss of income over time.

This sort of inequality gaps don't bode well for the future of our nation. The top 1% cannot continue to take the vast majority of the nations productivity and not expect political instabiity to occur.
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YES!!! WAGE STAGNATION!! thanks for bringing that up. There's only so much one can contribute to a 401K - when your salary isn't going up, you can't contribute more to it. Especially when expenses are going up at the same time wages/salaries are staying flat.
 
tekkychick said:
YES!!! WAGE STAGNATION!! thanks for bringing that up. There's only so much one can contribute to a 401K - when your salary isn't going up, you can't contribute more to it. Especially when expenses are going up at the same time wages/salaries are staying flat.
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If your wages are stagnating and prices are rising then it essentially comes down to having to consume less if you still want to save. Part of the beauty of America is we don't like to hear or be told that but it's reality.
 
evince said:
that is another thing about 401ks.

You have to manage them.

I did mine and lost very little because I adjusted mine when I saw the crash coming.


Its doing pretty damned well.


I know many many people who were FORCED to use their 401 k money up in the crash.
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really? who was FORCED to take money out of their 401k?
 
Mott the Hoople said:
401K's were never intended to replace traditional pensions when they were originally created. They were intended to supplement them and to incentivize working class people to invest in their own retirements.
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Yes, they were intended to replace the pension. Because a pension puts all the market risk on the company and none on the employee. Just look at what happens to city and state pension funding when the market takes a hit.
 
Superfreak said:
Yes, they were intended to replace the pension. Because a pension puts all the market risk on the company and none on the employee. Just look at what happens to city and state pension funding when the market takes a hit.
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401ks have come to replace the traditional defined-benefit pension, but that was not the original intent of that provision of the tax code.
 
cawacko said:
If your wages are stagnating and prices are rising then it essentially comes down to having to consume less if you still want to save. Part of the beauty of America is we don't like to hear or be told that but it's reality.
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I agree. Which of course isn't helping the economy because we cut back on spending.

But when my company's top officers keep getting more money and I don't - that's an issue for employee retention.
 
I forget who said it, but this sums up my feelings on 401ks: They are a way for both the government and your employer to disown you.
 
Superfreak said:
Yes, they were intended to replace the pension. Because a pension puts all the market risk on the company and none on the employee. Just look at what happens to city and state pension funding when the market takes a hit.
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which is why the people who like a boom and bust economy came up with the ideas of trying to make this how retirements were funded.

they have no risk but do have control of the markets much more than the little guy huh.


that is what they wanted.


why cant you grok that?
 
cawacko said:
If your wages are stagnating and prices are rising then it essentially comes down to having to consume less if you still want to save. Part of the beauty of America is we don't like to hear or be told that but it's reality.
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You can also demand a greater part of the wealth that you have produced. It won't be unskilled laborers that drive the change. It will be the skilled tradesmen and professional classes who do that.
 
Dungheap said:
No, it wasn't.

http://www.marketplace.org/topics/s...ther-modern-401k-says-it-fails-many-americans
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LMAO... in your own article it states the companies did just that as soon as they found out about it.

Tell us... what other incentive was there for the company to offer the plans? What was the intent that you think originally existed? The intent was to get people to save on their own in a tax deferred manner and allowing the shift of market risk from the companies to the individuals where it belongs.
 
If employees get pensions, chances are they are paying for them in some form or another.

It's really not that different from having a 401K. With 401K's, the company match is a big deal - companies that don't match will lose a competitive advantage in the marketplace for good employees.

And if you're worried about retirement, you should support privatizing social security.
 
Superfreak said:
LMAO... in your own article it states the companies did just that as soon as they found out about it.

Tell us... what other incentive was there for the company to offer the plans? What was the intent that you think originally existed? The intent was to get people to save on their own in a tax deferred manner and allowing the shift of market risk from the companies to the individuals where it belongs.
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The intent was to allow highly compensated employees save money on a tax free basis as deferred compensation. It was not designed to replace the defined benefit pension. A few years after the provision passed, companies figured out that they could use it as a means to make defined contributions (matching funds) in lieu of having defined benefit pensions, but that's not why section 401k was originally passed into law.

Also, too, why should individuals shoulder market risk? I don't understand that at all. It's, like, completely ass backwards.
 
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