Former New York Congressman and gubernatorial candidate Lee Zeldin pulled no punches in his condemnation of the Retirement Savings for Americans Act, which would establish a federal program to oversee private retirement plan saving and investing.
In an op-ed for Newsweek published Thursday, Zeldin wrote that under the bipartisan, bicameral bill, “employers would be mandated to enroll their employees in a new federal program if the business does not offer a retirement plan. That’s right, mandated.”
Claiming that private industry is successfully handling the retirement planning needs of millions of Americans, he argued the federal government should continue to support and encourage, rather than supplant, the private sector.
Referencing recent solvency concerns, he said Social Security continues its “death spiral without any real action to preserve and protect it,” and that benefits will either see dramatic cuts in the next decade or taxes will be raised by an “obscene amount.”
“And yet here we are, with the federal government looking to get its hands on more of your hard-earned money so it can set up another massive government retirement program. Isn’t one looming disaster enough?”
READ THE FULL NEWSWEEK OP-ED HERE
Zeldin’s comments mirrored concerns expressed by American Retirement CEO Brian Graff. Graff said the program, controlled by Treasury Department political appointees and backed by an influential Washington think tank, would foster unfair competition and crowd out the private sector. It would be exempt from ERISA and nondiscrimination requirements, and the federal government, rather than employers, would match contributions. He believes the bill is the beginning of a years-long battle over the future of America’s retirement.
“I’m not panicking that this will become law this year or next, but what we should be worried about is that there’s actually bipartisan support for a federally run retirement system subsidized by the federal government,” Graff said at the 2023 NAPA 401(k) Summit in San Diego in April. “We need to make clear that a federally run retirement system will never be acceptable.”
Zeldin added that because the program would be exempt from ERISA and Internal Revenue Codes that apply to private sector 401(k)s, “protections consumers currently enjoy with their retirement savings would disappear were they to place their funds into this new system.”
“Retirement savings are important, and I applaud Congress for working to make it easier for people to save,” Zeldin concluded, referencing SECURE 2.0. “But there are already myriad ways for consumers to meet their retirement needs and to do so with robust protections that carry no concerns about how political instability might impact their savings. Not to mention the fact that Congress has already made saving even easier with recent legislation. Maybe we should give all that a chance before creating Social Security 2.0.”