The Julian News 11
California Commentary
Why Does California’s Secure
Choice Program Still Exist?
by Jon Coupal
February 28, 2018
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Jon Coupal is the president
of the Howard Jarvis Taxpayers
Association.
® 2018 King Features Syndicate, Inc.
® 2018 King Features Syndicate, Inc.
California’s planned “Secure
Choice” program, if implemented,
would violate federal law. So
why are we needlessly spending
public tax dollars on its startup
costs?
The concept of the program
seems harmless enough: A
voluntary program — at least for
now — that would enroll private-
sector employees who currently
don’t have a retirement plan into
a state-run retirement savings
account.
But as with any government
program, the first question is why
is this program even needed?
Private-sector employees pay
into the Social Security system
and, upon reaching retirement
age, draw benefits from it.
While some have argued that
Social Security benefits are
inadequate, the program is
nonetheless backed by the full
faith and credit of the federal
government. Moreover, under
federal law, there are many
programs to assist private-sector
workers whose employers don’t
offer 401(k) or other employer-
based plans. These include
individual retirement accounts,
both traditional and Roth IRAs.
For workers without an employer
retirement plan, there are
generous limits on how much
can be saved tax-deferred.
Secure Choice is a solution in
search of a problem. Given all
the existing retirement programs
authorized under federal law and
managed by private investment
firms, the only reason to adopt
a massive new government
program is so that government
can control yet another part of
the economy currently being
serviced by the private sector.
Progressives truly believe that
government can do it better.
But better than what? The
California Public Employees’
Retirement System and other
public employee retirement funds
are carrying unfunded liabilities
in the hundreds of billions of
dollars.
Then there is the cost to
taxpayers. While the program is
ostensibly voluntary, the startup
costs of the program are huge.
For fiscal 2017-18, the Secure
Choice program has requested
a $170 million general fund loan
for staff, external consultants,
overhead costs and related
expenses. Speaking of “choice,”
it’s too bad taxpayers didn’t have
a choice in seeing their dollars
spent on this questionable
program.
Finally, there is the risk
to taxpayers in the event
Secure Choice goes bankrupt.
Defenders claim that this can’t
happen, but remember that
officials in Stockton, Vallejo and
San Bernardino once said the
same thing.
From the beginning, the legality
of Secure Choice, and similar
programs in mostly liberal states,
has been questioned because
it is inconsistent with a federal
law known as the Employee
Retirement Income Security
Act of 1974. ERISA imposes
requirements for retirement plans
in the private sector. Because
the Secure Choice programs
appeared to be in clear violation of
ERISA, those states that sought
to adopt those programs received
a regulatory interpretation from
the Obama administration which,
the states argued, granted them
an exception. Forgetting for the
moment the issue of whether that
federal regulation was even legal
(a recurring problem for much of
President Obama’s regulatory
efforts), it was rescinded shortly
after President Trump took office.
The upshot is that the weight of
legal authority is that California’s
Secure Choice program, if
implemented, would violate
federal law. Until California
and other left-leaning states
convince Congress to grant them
an exception — something very
unlikely for the foreseeable future
— spending further taxpayer
dollars on planning and set-up
costs is a waste.
California law allows taxpayers
to commence legal actions,
including injunctions, against
government entities for waste of
public funds. See, e.g. Code of
Civil Procedure Section 526a.
As long as California continues
to spend taxpayer dollars on a
program that, on its face, violates
federal statute, it is vulnerable
to legal challenge. In any event,
don’t we have better things to
spend our money on? • It was the multitalented Pierre Beaumarchais -- born in the 18th
century, he was a revolutionary in both France and America as well
as a watchmaker, diplomat, musician, spy, inventor, publisher and
arms dealer -- who made the following sage observation: "It is not
necessary to understand things in order to argue about them."
• Sharks burp. Yep, even underwater. Evidently, it's how they
regulate the depth at which they swim.
• You've almost certainly heard people refer to the school they
attended as their alma mater, but do you know where the term comes
from? In Latin, "alma mater" means "bounteous mother." It was in
the early 1800s that people began applying the term their beloved
schools.
• The skin of the African
elephant, the largest land animal
alive in the world today, weighs
2,000 pounds by itself.
• You might be surprised to
learn that the bagpipe did not
originate in Scotland. This ancient
instrument existed in Asia in the
pre-Christian era. Those who
study such things say that the
Emperor Nero was a bagpiper,
even performing publicly at
Roman athletic events.
• Those who keep track of such
things say that, across the globe,
there are more people who have
cellphones than have toilets.
• If you're like most Americans,
you've probably played with
a NERF ball at some point in
your life. You might not realize,
though, that NERF stands for
Non-Expanding Recreational
Foam.
• Actor Tom Cruise attended
15 different schools when he was
growing up.
* * *
Thought for the Day:
"A society that presumes a
norm of violence and celebrates
aggression, whether in the
subway, on the football field or
in the conduct of its business,
cannot help making celebrities of
the people who would destroy it."
-- Lewis H. Lapham
* * *
We live in a society in which spurious realities are manufactured by the
media, by governments, by big corporations, by religious groups, political
groups. I ask, in my writing, 'What is real?' Because unceasingly we are
bombarded with pseudo realities manufactured by very sophisticated people
using very sophisticated electronic mechanisms.
— Philip K. Dick
* * *
* * *
There are better ways we can
transform this virulent hatred - by
living our ideals, the Peace Corps,
exchange students, teachers,
exporting our music, poetry, blue
jeans.
— Helen Thomas
* * *
* * *
The central dilemma in journalism
is that you don't know what you
don't know.
— Bob Woodward
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