“Our
issues are becoming more political,” Brian H. Graff, Esq., executive director
and CEO of the American Retirement Association, told attendees of the 2015
ASPPA annual conference.
Retirement
is front and center, and there is a lot of concern that many people do not have
access to retirement plans at work, he explained. “The government finally gets
it that retirement plans are important, but now it’s not sure we are the best
to deliver those plans,” Graff told retirement plan advisers and service
providers.
A
movement has started to expand access to retirement plans. Graff noted that it
is focused on the same issues as health care reform—lack of coverage, access
and costs.
However,
while state governments have started the movement, they are not just mandating
that employers provide retirement plans; they are creating state products. “It’s
as if states are getting into the retirement business,” Graff stated.
Now,
the federal government is getting involved. In Interpretive Bulletin 99-1, the
Department of Labor (DOL) established a framework for non-Employee Retirement
Income Security Act (ERISA) payroll deduction individual retirement accounts
(IRAs). According to Graff, as California, Illinois and Oregon worked on their
state products, they asked the DOL for clarification that automatic-enrollment
does not make payroll deduction IRAs ERISA plans, Graff explained. The DOL was
reluctant to respond, but earlier this year, President Obama told the DOL to
develop guidance facilitating state programs.
NEXT: Giving states a competitive advantage
The
guidance from the DOL has not been proposed yet, but it is awaiting approval
from the Office of Management and Budget (OMB), so it is expected to be
published soon. Officials at the American Retirement Association have not seen
the guidance, but Graff shared what they’ve gleaned from discussions with the
DOL.
It
seems the guidance will have two components: a proposal that auto-enrollment IRAs would not be ERISA plans if employers are
required to participate—avoiding pre-emption by ERISA, and a rule allowing
states to offer open multiple-employer retirement plans (MEPs) that would be
treated as an MEP for affiliated employers—meaning, there would only need to be
one plan document, one summary plan description and one Form 5500 per year
filed. Graff says the first component would be delayed by the proposal, comment
period and hearing process, while the second component would be effective
immediately.
“This
gives a competitive advantage to state products; it’s not a level playing
field,” Graff said. In a 2012 advisory opinion, the DOL said an MEP open to unrelated employers does not constitute a single
employee pension benefit plan. Graff contended that if the DOL gives states a
competitive advantage over private providers, the uneven playing field will
lead to less competition, less innovation and worse outcomes for savers.
Judy
A. Miller, executive director of the ASPPA college of pension actuaries and
director of retirement policy at the American Retirement Association, noted
that the DOL is probably wanting to allow states to offer MEPs, because they
want something with ERISA protections.
NEXT: Problems with state plans
But,
Miller notes that there are many problems or unanswered questions about state plans. How will they define participants; what if employees live in
different states? How would states be held accountable for and correct errors?
Who will run and control investments?
While
the DOL guidance may address how these plans should be structured or run, right
now it depends on rules set by each state, Miller noted. For example, Illinois
issued a request for proposals (RFP) for an investment provider and it has a
board that acts as an investment committee. The American Retirement Association
is asking that the DOL require a designated service provider, registered with
the DOL, to make sure rules are being followed, she said.
Miller
also contended that the MEP concept will not work unless there’s an employer
mandate to participate. Graff agreed, noting that this movement by states is
based on the notion that the retirement industry is not offering a
cost-effective solution for small businesses. “There are many cost-effective solutions
available. The problem is distribution. It takes time and effort to set up
plans for businesses,” he says.
Why
would employers jump on board just because a state is providing the product,
Miller added.
Miller also noted
that the federal government’s Thrift Savings Plan (TSP) has usually followed
the trends of the private sector. “States will be laggards; they won’t be ahead
of the curve,” she contended.
Last
week, I asked NewsDash readers, “Which candidates in the running for the
Republican and Democratic nominations are you familiar with, and if you could
ask the candidates one question, what would it be?”
Democratic
candidate Hilary Clinton is the candidate most familiar to responding readers
(95.5%), followed by Republican candidates Jeb Bush, Chris Christie and Donald
Trump (each selected by 93.3% of respondents). Eighty percent to 90% of
respondents were familiar with Republicans Carly Fiorina, Marco Rubio, Ben
Carson, Mike Huckabee and Ted Cruz, and Democrat Bernie Sanders.
Getting both parties
to work together, the economy and trust were common themes in the questions
readers would pose to the candidates. “Do you really believe everything coming
out of your mouth?” and “Are you able to answer a question with a single
sentence?” are examples of some of the less agenda- and character-related
questions. And, in reading the questions, I learned what the Kobayashi Maru is.
Questions readers
would ask candidates
How
would you enhance medical and social security benefits to ensure a secure
retirement for all Americans?
It
seems to me, so many serious social issues the U.S. has, relates to drug abuse.
Why is no one addressing this issue and how to resolve it?
Ben
Carson: Where have you been all this time?
What
special powers do you have that would allow you to successfully contend with D.C.
gridlock, and major parties that are hijacked by their fringe members?
How
do you define democracy, and how does your definition relate to the tenets and
vision of the founding Fathers?
Do
you really believe everything coming out of your mouth.....
What
makes you so sure you can make a difference/
You
do realize that there are 535 other people (Congress and the Senate) that will
need to vote your agenda items and campaign promises into law and that each and
every one of those 535 people have their own political and personal agendas and
campaign promises to fulfill?
What
is your plan to bring down the cost of health care and prescription drugs in
this country? Prices are outrageous and getting worse, not better. Don't say
"undo Obama care" because that's a cop out for addressing the real
issue and going after the real offenders who are profiting at the expense of
the middle class.
I would ask Hillary
Clinton why she thinks she is above the law and why she is such a liar and a
phony.
Questions to
candidates (cont.)
Why
should I trust you?
How
will you get the federal government out of citizens' lives so that the country
can generate true economic growth?
How
do you intend to bridge the divisions in Washington and in our country
(political, cultural, socioeconomic, race, etc.)?
What
protection does an unborn baby deserve while it resides in the mother's womb?
What
is the definition of social democracy and how does it fit with capitalism?
How
are you going to work together with both parties to get things done? Also, will
you be a president for all of us, republican and democrat as our current
president has continually been demonizing everyone who is republican.
How
will you stop the gun violence in this country?
How,
and over what time frame, will you bring balance back to the federal budget?
Exactly
what is your plan to get the American economy back on its feet? Please provide
details.
Why can't we live
within our means? Why can't we spend only what we make?
Questions to
candidates (cont.)
Why
our representatives are letting government take over the people
Will
you support repeal of the Cadillac Tax provision of the Affordable Care Act?
What
are you going to do to get more bipartisan cooperation so that things can
actually get done without all the finger pointing, slander and lying?
What
would you say to prove to me that you truly love this country and have the
highest level of ethics to lead it?
Hillary
Clinton, "Why did you say for over two weeks (and to the families of the
four assassinated Americans), that the Benghazi attack was the result of a
video when you knew that it was a terrorist attack?"
What
three things regarding your party's platform do you disagree with, but keep to
yourself so you can win the party's nomination?
"Why
shouldn't you be president?"
What
would you do to end the deadlock in Congress and bring civility back to
governing?
I'd
like to ask the candidates "How have your actions in the past shown the
American People you can be trusted to be our leader?"
Will you work to
balance the budget?
Questions to
candidates (cont.)
Are
you able to answer a question with a single sentence?
Why
do you want to be President of the U.S.?
Do
you think it is right that Obama continues to use his executive power so much
in his term as President over riding the Congress and Senate? Would you?
We
agree this is the greatest nation ever but we are a divided nation now.
Considering the saying "United we stand as one nation"; what is the
first thing would you do bring this nation together as one?
Without
increasing taxes/fees, how are you going to pay for everything you promised?
Someday the rich won't be there to tax.
How
would you solve the Kobayashi Maru?
What
is the real reason (a specific answer without generalizing the response to
provide absolutely no actual thoughts) that you are interested in becoming
president, which means having your entire life and the lives of those around
you scrutinized to the smallest tidbit of information.
Will
make sure the Cadillac tax is repealed?
If you become
president will you, CAN you, move beyond mandated party line dogma and your big
money donors selfish interests and do what is right for ALL Americans? (I think
I already know the answer.....unfortunately.)
There
was much concern expressed in comments left by responding readers about the
quality of candidates who are running—“If Donald Trump wins, I will move to
Canada,” one reader said—and the “mess” our government is in. One reader called
the race so far a “circus.” However, some readers expressed pleasure with
having candidates with non-political histories. Some say it is just too soon to
pay much attention to what is happening, and others had suggestions about presidential
campaigns and terms. Editor’s Choice
goes to the reader who said, “This has been the most entertaining race I can
remember. Can't wait for the next debate!”
Thank you to all who participated in our survey!
Verbatim
Heaven
help us if any of the unqualified misfits running in the Republican primary are
elected president. The middle class is in enough trouble already and the poor
would be totally devastated with a Republican in the White House. My fervent
hope is for President Sanders or President Clinton.
I
know for sure, that anyone with previous political experience has little chance
of getting my vote.
It's
time to elect someone who isn't a professional at politicking.
The
process is fascinating every four years. So much power lies with the far right
and far left elements of the major parties, that what it takes to gain the
nomination may also doom their chances in the general election.
Throw
them all out and start over. We need common sense, plain speaking, and an
honest ability to work without the restraints of special interests.
none
Seems
likes the race starts the day after inauguration. The race is so long and
convoluted that unless you love American politics and posturing, who cares
until the conventions?
This
has been the most entertaining race I can remember. Can't wait for the next
debate!
It's
a joke on the Democratic side because all the men are afraid to attack Hillary
Clinton. The Republican side has some good moderates like John Kasich who can appeal
to reasonable moderate Democrats like myself.
If we end up with
Bush vs. Clinton, do we need any other proof that the game is rigged?
Verbatim (cont.)
So
depressing -- all these choices and none of them inspire confidence or
excitement for the future of our country. Perhaps I am just getting too old and
cynical and have lost the idealism of youth.
I
watched the democratic and republican debates and was shocked at the lack of
highly qualified candidates on the democratic side relative to the caliber of
republican candidates.
Our
country is in a lot of trouble if at this point in the race The Donald is still
on top of the Republican nomination.
Stop
the taxpayer subsidies of the 2 major parties!
Why
must the choice always be the lesser of two evils? Why can't we have strong,
ethical, trustworthy candidates who, when their two terms are up return to
their usual employment that is NOT being a politician or lobbyist?
While
it's still early in the race, I would not vote for any Democratic candidates as
I can't vote for a liar and law breaker and I can't vote for a socialist. And I
don't want a TV personality in the office. At this point the only one making
sense is Carson. I'm not convinced anyone but God himself can get us out of the
mess we find ourselves in that Washington has created.
No
one is capable of telling the truth, all are beholding to someone and will have
to "pay the piper" if they win. Ross Perot for President!
Hilary
for prison in 2016!
I
wish all had a set dollar amount to spend on their campaign and that was it and
that their commercials only could do with themselves and not what others
allegedly do or have done. I am so sick of seeing the negative ads. Glad I
don't watch TV much.
I
keep thinking of the movie Brewster's Millions -- maybe None of the Above will
win. (yes, showing my age in referencing this move!)
There is no such
thing as 'free stuff.' Somebody pays.
Verbatim (cont.)
I'd
like to see two changes. First, a strong three-party system. Second, the
President is allowed to serve one six-year term. That way he/she doesn't waste
time with re-election efforts and has enough time to accomplish their agenda.
If
Donald Trump wins I will move to Canada, I've thought that before, but never
ever really felt it.
When
did the Republican Party become a personality contest?
WAYYYY
too early to get behind a candidate. Many of them will be dropping out, so I am
not paying attention until I know who's left!
As
candidates drop out, especially republicans, I would like to see them throw
their support behind another, preferably Marco Rubio. It strengthens that
candidate's position and shapes the race for a Republican victory. God help us
otherwise.
Cut
out the blame game "right wing conspiracy" and personal attacks
"look at that face". Some of these candidates resemble petulant
children.
Probably
the most interesting in many years. Not sure where it is going to end up, but I
think more people are listening this time.
There
is no one on either side who you would say is really presidential.
I
now understand why there's global warming, at least with regards to the effect
of hot air on North America. Stand by for an empty breeze followed by the smell
of the dump as the winds shift.
Overall,
I wish we as a people would select real people, those that have lived real
lives, have made mistakes and have learned from them. Scandal is one thing,
real life is another and provides a background to make decisions.
Sick
of it already. It's a circus with Donald Trump as the ringmaster.
Can't
wait to see the anti-Obama screeds you're going to get from the right wingers.
Here's one opinion that even with his flaws Obama is more on the side of, and
wants to do the right thing for most Americans than any of those regressive,
obstructionist, tea party puppet conservatives running on the republican side.
NOTE: Responses reflect the opinions of
individual readers and not necessarily the stance of Asset International or its
affiliates.