Government still contemplating 401K takeover.

There was a story I covered one year ago ago where several lawmakers met to hear a proposal of an outright 401K takeover modeled after the Argentine policy.  At the time it seemed like a far fetched notion, but BusinessWeek ran a story hinting that the threat still exists. 

Now the story itself does not outright suggest a takeover, but the following should give you pause.

The U.S. Treasury and Labor Departments will ask for public comment as soon as next week on ways to promote the conversion of 401(k) savings and Individual Retirement Accounts into annuities or other steady payment streams, according to Assistant Labor Secretary Phyllis C. Borzi and Deputy Assistant Treasury Secretary Mark Iwry, who are spearheading the effort.

So as of now the idea is to gently inquire as to whether people would be interested in converting their existing accounts into steady revenue streams.  For laymen this simply means investing into the treasury market and this should not be surprising given what is in store for America in 2010.  You see, we have several trillion dollars worth of debt we need to roll over not to mention several trillion more to keep up with newly implemented spending programs.  Because as of later 2009 the primary foreign buyers of our debt (China, Japan, UK) have all turned off their spigots we are facing a dilemma.  Apparently this dilemma is directing someone at the federal level to go after a gigantic pool of money - our retirement accounts. 

Once again, as of now, this appears to be an option and according to the same BusinessWeek article not a very popular one.  If our Treasury cannot convince people to buy our debt then it will do what government does best, use force.  After all, Social Security could have easily been a voluntary program - same as Medicare, for all the cheap lip service liberals pay to "competition" they seldom follow their own advice.  In fact even the income tax is "voluntary"!  It would not be completely out of the question for mandates to start appearing that a portion or the full entirety of one's 401K retirement account goes strictly to buying US Government debt!

Now beyond being immoral and reprehensible from a purely monetary standpoint it's just flat out theft.  America cannot guarantee it's ability to pay just like it cannot guarantee that Social Security and Medicare will be solvent in the future.  Social Security is a massive ponzi scheme that is destined to screw over several generations in the foreseeable future and a possible 401K takeover will be an extension of this theft on a grand scale. 

Instead of drastically cutting spending and making Social Security voluntary while raising proceeds to take over those currently RELIANT on Social Security our ruling class is desperately seeking ways to stem the bleeding, bleeding they themselves caused.  So in the best case I am just paranoid although our Treasury is indeed in big trouble OR we are staring at a most daunting prospect of having our nest eggs confiscated and the first legitimate reason for a large scale revolt.