Why Is Teresa Ghilarducci Considered "The Most Dangerous Woman in America"
Teresa Ghilarducci is a 51 year old economist who directs the Schwartz Center for Economic Policy Analysis at the New School in New York.
Why was Ghilarducci--who sure looks like a nice person in her picture--labeled the most dangerous woman in America in a recent US News & World Report column?
The short answer is that she thinks 401k plans stink and she is not afraid to let the world know.
Ghilarducci is the author of a recent book titled: When I'm 64: The Plot Against Pensions and the Plan to Save Them. Ghilarducci uses the book to lay-out the case against the 401k plan and to advocate an alternative which would involve a retirement system run by the government rather than the private sector.
Among her criticisms are the following:
- 401ks are voluntary and not enough people actually participate.
- Levels of savings for those who do participate are completely inadequate.
- Mutual fund management fees are excessive and eat away at the savings of 401k participants.
- Not enough employers make matching contributions to 401ks.
- 401k plans are highly regressive. In other words, those who benefit most from the system and the tax advantages are higher income earners. Those at the lower end of the income spectrum benefit least.
These criticism are well founded and are not entirely novel. What has the industry and certain parts of the media up in arms is Ghilarducci's proposed alternative to the status quo.
Ghilarducci advocates mandatory contributions from employers and employees that would total 5% of income. The retirement program would be administered by the government, but the plan assets would remain private property of each employee. The program also calls for the government to guarantee a return of at least 3% over the rate of inflation.
Pretty interesting and provocative ideas that we'll continue to follow--Ghilarducci must be on to something to have received the strong reactions that have surfaced thus far.
Anonymous (not verified) wrote on Sat, 05/29/2010 - 07:12:
IT'S ABOUT TIME SOMEONE STARTS LOOKING OUT FOR THE WORKING MEN & WOMEN OF AMERICA, ALOT OF US ARE TRYING TO DO THE RIGHT THING WITH OUR SAVINGS, BUT IT SEEMS THAT WE JUST AREN'T GETTING ANYWHERE, TERESA GHILARDUCCI KEEP UP THE GOOD WORK, I WILL BE FOLLOWING YOU..THANKS.
William (not verified) wrote on Mon, 09/27/2010 - 17:37:
Please please please. Do you know what that would do to the very large Insurance Industry? And why does the government want to create all these insurance pools including Healthcare and retirment? So they can use the funds to furhter entitlement programs like this one and more. Stop the Spending!
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:10:
What part of "the plan assets would remain private property of each employee" was too hard for you to understand?
Like most mindless "conservatives" (as distinct from the thoughtful kind) your knee-jerk reaction to every proposal for a government program is to scream "Socialism!", and then turn off your brain.
Are the Police, Fire and Sanitation departments Socialism? Are our courts, public prosecutors, interstate highways?
Socialism rejects the notion of private property. This proposal would make each account private property. Therefore, this is not "Socialism!".
Whether it's a good idea is a different question; one that can't be answered by knee-jerk responses, and mindless repetition of empty rhetoric!
Charles (not verified) wrote on Mon, 08/27/2012 - 15:21:
The fact is this... It is a socialist program. It will be enforced as another social security tax that is already taken out of every worker's paycheck. It is forcing the worker into another 3rd party program which the government has control over - forcing us to directly fund another program that the American people wouldn't want anyway.
For you to bring police, fire, and sanitation into it is just plain stupid. Everyone knows that they're run by states and municipalities.
This program is completely different. It will be run by the federal government. They will take your money and put it into government owned companies like Amtrak and GM. Since the federal government also runs the federal reserve, they will simply print the money to cover the losses. (There WILL be losses) - This will only increase inflation and diminish the value of the dollar - driving this country deeper and deeper into the red.
Jere F. Moore (not verified) wrote on Thu, 11/29/2012 - 19:31:
"Are the Police, Fire and Sanitation departments Socialism? Are our courts, public prosecutors, interstate highways?"
Of course not, but what has that to do with picking the pocket of one person for the benefit of another, which is, most certainly, socialism? Also, the author specifically states that the goal is to "spread the wealth," and the only way to do that is to take from one and give to another, as in "from him according to his means to him according to his need." Sound familiar? I suppose you do not see that as socialism, either, but then I suspect that you would not consider anything as socialism that puts your neighbor's money into your pocket.
Anonymous (not verified) wrote on Wed, 12/12/2012 - 10:40:
When the goverment is REQUIRED to see that the fund maintains a growth rate of at least 3% over the inflation rate, it becomes a social program. Why? Because then tax dollars are the only way to insure those kind of earnings, particulary in recessionary cycles. While her heart is in the right place, it's a bad idea.
Anonymous (not verified) wrote on Mon, 02/25/2013 - 13:21:
Would you give me your 401(k) to "administer" it i promise it's still your personal asset. If you will, I give yo a PO Box where you can send the check, but you're a fool.
Where do these "guaranteed" returns come from anyway. Are you and others on this site completely incapable of doing ANY critical thinking?
Live like a sheep and eventually you'll get shaved (or worse).
What part of that can't you understand?
Any Nanny Mouse (not verified) wrote on Thu, 01/06/2011 - 13:51:
I can't stand people who don't know how to set a budget for their lives. Hey, socialist pigs: keep your hands off my money. You need to spend less and save more. Americans need to learn the hard way that socialism will not save the country when the sense of entitlement is so high.
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:11:
What part of "the plan assets would remain private property of each employee" was too hard for you to understand?
Like most mindless "conservatives" (as distinct from the thoughtful kind) your knee-jerk reaction to every proposal for a government program is to scream "Socialism!", and then turn off your brain.
Are the Police, Fire and Sanitation departments Socialism? Are our courts, public prosecutors, interstate highways?
Socialism rejects the notion of private property. This proposal would make each account private property. Therefore, this is not "Socialism!".
Whether it's a good idea is a different question; one that can't be answered by knee-jerk responses, and mindless repetition of empty rhetoric!
satan2liberals (not verified) wrote on Sat, 03/02/2013 - 12:21:
Etaoin Shrdlu "What part of "the plan assets would remain private property of each employee" was too hard for you to understand?
Like most mindless "conservatives"
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You're an idiot. Just because that claim is mentioned above doesn't mean it's true.
If one actually reads and understands the proposal only a stupid person would consider that as having the characteristics of "personal property".
here educate yourself
http://www.sharedprosperity.org/bp204/bp204.pdf
Anonymous (not verified) wrote on Mon, 08/06/2012 - 16:53:
That is insanity. Giving the government any control over people's retirement would wind up in as big a mess as Social Security. We all know how well that's worked out. If they want to be pro-active, let them set regulation on the fees paid to administrate the 401K with a minimum return percentage. That should be the extent of their interference.
keith (not verified) wrote on Sat, 05/29/2010 - 07:15:
i submitted the last page
William (not verified) wrote on Mon, 09/27/2010 - 17:35:
I appreciate your candor and excitement over the possibility of getting a retirement plan from the government. After seizing all retirement assets privately worked for and earned. So, what if you make 50K for 20yrs you pay-in $2,500/yr or $50K. And I make $150K for 10yrs, I pay in $7,500/yr or $75K and $200K for 10 yrs anothee $10,000/yr or $100K, I would pay-in $300,000 in 20 yrs. Let me ask you, do you think we will get paid the same amount from the government if we are the same age and have the same life expectancies? Hmmmmmmmm. you'd outlive yours and I wouldnt, thereby taking rather than giving. Nice Ponzi Scheme dont you think? You see, we ran from tyranny and oppression to fen for ourselves, you and me included. The less they take from us, the better prepared you are to take care of yourself. THink first !!!
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:14:
Where did you get the idea that Ghilarducci is planning on seizing any retirement assets (let alone all of them)?
What part of "the plan assets would remain private property of each employee" was too hard for you to understand?
Like most mindless "conservatives" (as distinct from the thoughtful kind) your knee-jerk reaction to every proposal for a government program is to scream "Socialism!", and then turn off your brain.
Are the Police, Fire and Sanitation departments Socialism? Are our courts, public prosecutors, interstate highways?
Socialism rejects the notion of private property. This proposal would make each account private property. Therefore, this is not "Socialism!".
Whether it's a good idea is a different question; one that can't be answered by knee-jerk responses, and mindless repetition of empty rhetoric!
So, when will you start "thinking for yourself", and stop being just another Republi-Con parrot?
Anonymous (not verified) wrote on Fri, 04/05/2013 - 14:15:
Hey idiot, what do you think will happen to the money once someone dies who contributed....you think it will go to the family? Think again (or in your case you don't think). All will be a ward of the State. You Libtard Dope!
Anonymous (not verified) wrote on Tue, 10/05/2010 - 12:59:
Wow! The Govt. will force us to contribute to a "retirement plan" and the benevolently "redistribute" it to us as they see fit when we retire. Despite what her bogus claims are, the 401k is one of the most successful and important plans to help individuals save for retirement that we have ever had...far better the Govt. ponzi scheme, social security, which is going broke. The 401k is avaiable to all who work for a cmployee who provids one (and most do) regardless of income level. It is completely voluntary and individuals can contribute as they want or can afford. And, most can chose the type of investment. It's freedom of choice. What is most frightening is how many Americans are willing to give up even more of their economic freedom to government in the false name of security.
Anonymous (not verified) wrote on Sun, 05/13/2012 - 13:57:
She's right - the 401(k) system as advertised is one big scam. It won't adequately prepare the average worker for retirement. In fact, it benefits the financial services industry much more than investors. Do your banking with a credit union. Invest directly with a company that operates on a not-for-profit basis, like Vanguard or TIAA-CREF (cut out the middle man, like a stockbroker). And when you hear the bloodsuckers in the for-profit segment of the financial services industry howl, tell them exactly where to go.
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:17:
She has facts to back up her claim that the 401(k) system has failed. What do you have? Just right-wing "talking points" and ideology.
What part of "the plan assets would remain private property of each employee" was too hard for you to understand?
Like most mindless "conservatives" (as distinct from the thoughtful kind) your knee-jerk reaction to every proposal for a government program is to scream "Socialism!", and then turn off your brain.
Are the Police, Fire and Sanitation departments Socialism? Are our courts, public prosecutors, interstate highways?
Socialism rejects the notion of private property. This proposal would make each account private property. Therefore, this is not "Socialism!".
Whether it's a good idea is a different question; one that can't be answered by knee-jerk responses, and mindless repetition of empty rhetoric!
What's frightening is how many people (like you) believe ideology is a substitute for reality!
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:19:
Sorry, that Comment was misplaced. It's supposed to be in reply to the Comment of Tue, 10/05/2010 - 12:59.
Anonymous (not verified) wrote on Sun, 10/17/2010 - 10:02:
While high income people may benefit the most from the tax advantages of 401ks I think we should remember that there are great benefits for lower income people as well under our current plan such as the Roth 401k and Roth IRA. For people in lower tax brackets they have the huge advantage of being able to save in account that will allow both their contributions and earnings to be withdrawn completely tax free.
cmm912 (not verified) wrote on Mon, 10/18/2010 - 10:33:
I am very sorry people, but America IS NOT A SOCIALIST COUNTRY!!! I WORK HARD FOR MY MONEY, AND UNLESS I CHOOSE TO GIVE IT AWAY, OBAMA WILL HAVE TO PRY IT FROM MY COLD, DEAD HANDS!!!! THIS IS WHAT DICTATORS DO - THEY DECIDE WHAT, AND HOW MUCH, YOU CAN HAVE, EVEN THOUGH YOU PAID FOR IT!!!! For all of you people who want to live under Socialism, there are plenty of countries you can MOVE TO (I will even buy your one-way ticket!), so STOP TRYING TO CHANGE AMERICA!!! I am a 53 year old woman, and I NEVER thought that I would some day, perhaps literally, be fighting against a tyrannical government in my own country!! But you can bet that I WILL, if necessary! And with each passing day, it looks more and more necessary.
Anonymous (not verified) wrote on Thu, 02/10/2011 - 16:46:
You probably work for one of the big corporations or banks that are stealing us blind. Corporate Welfare is the problem. Not socialism. Take a graduate economics course!
Anonymous (not verified) wrote on Sat, 03/19/2011 - 14:34:
You don't have to "take a graduate economics course" course to see that govt intervention "on our behalf" is a poison pill. You take graduate economics courses to brainwash yourself into thinking personal accountability is an obsolete notion and that corporations and banks are all evil, you elitist jackass.
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:26:
So, all government intervention is a "poison pill"? I take it, then, you'd rather we never passed the Clean Air and Clean Water Acts. That way the "pure, perfect, sacred, and holy" free market could continue to poison us without that nasty "tyrannical" government acting to protect us!
cmm912 (not verified) wrote on Mon, 10/18/2010 - 10:36:
P.S., for those who pooh-pooh accusations of Socialism, Teresa Ghilarducci is an "on again-off again" member of the Democrat Socialist Party. Verifiable online.
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:31:
To cmm912 , writing on Mon, 10/18/2010 - 10:36:
Since there's no such thing as the "Democrat Socialist Party" (anymore than there's a "Republi-Con Fascist Party"), you've just demonstrated more brain dead right-wing rhetoric, instead of rationality!
Again, please explain how a plan that creates private assets that will remain the private property of the employees constitutes "Socialism!"?
Anonymous (not verified) wrote on Tue, 11/02/2010 - 05:38:
Another example of the slow erosion of our freedoms!
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:35:
"The slow erosion of our freedoms." How so? If we, the voters of this country, choose to elect a government that creates such a system, isn't that an exercise of our freedoms?
Anonymous (not verified) wrote on Tue, 11/02/2010 - 09:30:
I CAN NOT believe what I am reading in this article. I feel like I've just woken up to a communist country or a George Orwell novel. Why is it that every liberal's answer to any issue is a government take-over of the private system? The Feds can't even figure out how to deliver the mail without losing millions upon millions of dollars (or social security for that matter), yet I am to believe that government can do a better job with my 401(k) that I can??!! What a joke!!
Anonymous (not verified) wrote on Fri, 03/18/2011 - 08:09:
The very people who time and again prove beyond a doubt that they cannot manage money competently want to take over my retirement funds to "protect" me. How else can we attempt to wreck this wonderful country?
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:38:
Actually, it's people like you who make me think I'm living in Orwell's 1984. For you any government program is a "take over" (even when it's not)!
Bill (not verified) wrote on Thu, 05/10/2012 - 12:44:
Why do you say, "Ghilarducci must be on to something" because she has provoked some strong reactions? Is that the litmus test for good ideas? Was Hitler "on to something" because he provoked strong reactions? I know that is an extreme example, but I think you present a logical fallacy to infer her ideas are sound because she has provoked a lot of reaction.
tom wrote on Thu, 05/10/2012 - 14:38:
On to something in the sense that the basis for the case she is making is credible and factual.
Fact of the matter is that the defined contribution system is regressive and--in the current form--does not serve as an adequate pillar of retirement funding for the vast majority of Americans: http://www.annuitydigest.com/news/some-sobering-401k-statistics
Etaoin Shrdlu (not verified) wrote on Mon, 08/06/2012 - 12:44:
Dear Bill:
At last! An intelligent Comment, that doesn't consist solely of empty rhetoric and brain dead ideology.
Yes, the fact that something provokes controversy is no measure of its validity. (Though I agree the comparison to Hitler is a poor one. There's nothing dictatorial about Ghilarducci's ideas.)
But the "conservatives" should also remember that popularity is no measure of validity either. However rich the Limbaugh's and Beck's of this world become by spewing their bile, it remains just bile.
(After all, going by popularity, both the ideas of FDR and Reagan are "valid"!)
Anonymous (not verified) wrote on Tue, 08/07/2012 - 12:37:
"There's nothing dictatorial about Ghilarducci's ideas."
Did you miss the mandatory 5% part?
Anonymous (not verified) wrote on Fri, 10/05/2012 - 11:13:
Etaoin,
Are you an American?
CHK
Anonymous (not verified) wrote on Thu, 11/29/2012 - 17:00:
"Ghilarducci advocates mandatory contributions from employers and employees that would total 5% of income."
Mandatory contributions. Nope, nothing wrong here, just the government forcing us to pay for retirement twice. During the fight to enact SS, the government swore it wasn't a tax, and yet when it went before the SCotUS, it suddenly became a tax (because that is something the government is actually allowed to do). Now, we'll have another mandatory tax to fund our retirement...oh hey, did anyone else notice that they didn't get their own private lockbox with their SS contributions in it? Wow, I wonder what happened with that whole notion...
"The retirement program would be administered by the government..."
And we believe that the government is going to be able to do this properly because....(crickets). The federal government is *always* more inefficient and less effective in these matters. Hence their need to mandate contributions. If the federal government had a better plan, they wouldn't need to mandate it, everyone would be lining up to take advantage of it!
"The program also calls for the government to guarantee a return of at least 3% over the rate of inflation."
Ahhh, and there's the kicker...how do you suppose that the government will *guarantee* a return of at least 3% plus inflation on a free market based economy, eh? Let me think...how does the government guarantee anything it does, hmmmm?!??!
Get your head out of your ass and realize that the only thing that the crooks up in the beltway care about is how to separate more money from your pockets to line their's. Control over funds of this nature ("administer") means power, and that's all they care about. Wasn't it the liberals from the 60s that were always warning us about "the man"...well, the federal government is "the man" and its grown huge (bloated beyond belief) and over powered.
Funding the federal government shouldn't be our primary goal in life. So, honestly, when will it be enough? When will the government be big enough for you beta-male sycophants slavering at the government trough? Maybe we'll get lucky and all of the evil rich people (read, productive people) finally leave this country and let the system collapse under its own (dead) weight....and good riddance!
Anonymous (not verified) wrote on Tue, 08/07/2012 - 12:35:
Let's take a mandatory 8.5% of our paycheck and put it into these private accounts. Then, take a matching 8.5% from our employer, and put it into a public pool as a safety net. We could call the public part "Social Security." Oops, sorry, this skips the part where government expands, never mind.
Dale Faulkner (not verified) wrote on Tue, 08/14/2012 - 10:16:
Ms. Ghilarducci,
You need to keep your hands off my money! I will invest it, I will spend it how I see fit and I don't want nor will I accept you telling me I have to give the gov. 3% so you can invest it. Man up, take care of your life, your money and your family and keep gov. out of my wallet and my bedroom!
Anonymous (not verified) wrote on Fri, 10/05/2012 - 11:05:
Isn't the Social Security Trust Fund full of IOU'S? - and the Country is broke! It doesn't take a rocket scientist to figure out how the Government would handle this idea of yours. No thanks Teresa. I'll (have) prepare for my own retirement. Your time would be better spent influencing people to understand the benefits of individual responsibility.
CHK
Mike (not verified) wrote on Thu, 11/29/2012 - 18:05:
As someone in their late 30's who has been contributing to a 401k since I started working out of college and investing it wisely, why would I want to settle for a return of inflation + 3%? The time value of money (compounding, etc.) is what makes my 401k grow. The further away from retirement I am, the more risk and return I accept yielding greater growth of my 401k in my earlier years. Closer to retirement, I'm basically maintaining the balance and trying to keep up with inflation. Why would I want to do that from the beginning?
Also, considering rates are so low now, wouldn't it cost the Federal Government a ton of money to make up the difference? Wouldn't the fact that everyone was investing in the same vehicle drive down the yield and prices of government bonds, thereby costing the Fed even more money?
And how am I supposed to trust that the money will be there when I retire?
What happens to the other social security taxes I already pay? Am I supposed to pay that plus this new thing? Do I no longer get credit for all the money I've paid into the system that is not supposed to be there when I retire, anyway?
I'd have to sit down and run the numbers and see if it made sense to liquidate my 401k and pay the early withdrawal penalty plus income taxes to see if it would make out better than what I'd be "promised".
Can you imagine all the plan custodians and investment houses out there would lose all that fee revenue? I can't see how this could possibly happen.
Last point, I don't even come close to making $250k a year, but I'm tired of the "higher income earner" labels and such. If the government is really going to pursue such projects, then they should seriously consider making adjustments for cost of living across the country. $250k a year in the midwest is good living. $250k a year in Silicon Valley...well it means you can barely afford a basic home that costs $800k in an ok neighborhood with a crappy school system.
Thanks for listening.
satan2liberals (not verified) wrote on Sat, 03/02/2013 - 12:56:
mike"I'd have to sit down and run the numbers and see if it made sense to liquidate my 401k and pay the early withdrawal penalty plus income taxes to see if it would make out better than what I'd be "promised"."
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One would be a complete fool not to liquidate every asset you held in a retirement account once this atrocity of legislation passes either house or congress.
I'd rather take the one time 40+% hit than lose virtually everything.
Remember once they steal your account you have also lost forever the "opportunity cost" compounded 20 -40-60 yrs.
satan2liberals (not verified) wrote on Sat, 03/02/2013 - 12:42:
1) The retirement program would be administered by the government, but the plan assets would remain private property of each employee. 2) The program also calls for the government to guarantee a return of at least 3% over the rate of inflation. 3) Pretty interesting and provocative ideas that we'll continue to follow Annuity Digest 1) That's a lie , assets do not remain private property. 2) 3% over the inflation rate, you mean 3% over the inflation rate that the govt admits to. Nothing prevents the govt from lying on this figure as a matter of fact it gives them every incentive to lie about the inflation rate. They can always just print the money to give to each retired employee. 3)It's certainly provocative and stupid. Argentina did this in 2008-9 and it crashed their market. There's roughly 17 trillion dollars in these account the govt wants to steal. If we let the govt do this it's oct 1917 all over again because then they will control virtually every company & asset in the US. The US market capitalization is roughly 60 trillion., 22trillion in stock , 38 trillion in bonds. How could uncle sam liquidate these assets without crashing the market ? ans he can't. oh btw since US retirement accounts are not just US assets what is thatin world terms ? Well think about it if you nationalize 17.4 trillion that's 8% of the worlds total stock &bond capitalization of 212 trillion dollars.
satan2liberals (not verified) wrote on Sat, 03/02/2013 - 13:15:
Annuities are a terrible idea for a purchaser today, considering the inflation risks we face today. I would suggest a good dividend paying portfolio instead. Annuities are only for people who want to waste money eschewing financial competence and those diagnosed with dementia. 401k's well at least they help you save but admin expenses often make them inferior to DIY
jdust1948 (not verified) wrote on Tue, 03/26/2013 - 10:41:
One has only to look at how well the federal government has handled the Social Security Trust Fund to run from Ms. Ghilarducci's proposal like one would run from the devil. Tehre is no money in the trust fund. Congress and presidents have spent it all. Now it's a huge and growing contributor to the deficit as Congress has to pay back those funds. To do that, they are using devalued and borrowed dollars.
You want to give them another "lockbox" fund? Better you should throw your money into the river just for the joy of denying the government more reasons to waste our money.
Anonymous (not verified) wrote on Mon, 04/29/2013 - 12:51:
Talk about the fox guarding the henhouse! Does anyone trust politicians to do the right thing or to tell the truth? In the face of real unemployment of ~21%, real inflation of ~10% and the reduction of purchasing power of the US dollar by ~27% since obama took office (due to debasement of the currency), I certainly don't. The plan is to require people to place their funds in Tbills and the like - thereby offering less choice and a greater money pool for the hacks in DC to spend wrongly!