Feds Eye 401k’s in Debt Balancing Discussions

Feds eye retirement-fund tax to cut $16 trillion-plus deficit New York Post ^ | 8:25 AM, April 22, 2012 | By GREGORY BRESIGER

Posted on Sunday, April 22, 2012 7:46:02 PM by DeaconBenjamin

Uncle Sam, in a desperate attempt to fix its $16 trillion-plus deficit, is leering over Americans’ retirement nest egg as its new bailout fund.

Capitol Hill politicians are assessing tax changes that could let the Internal Revenue Service lay claim to a portion of the $18 trillion sitting in 401(k) accounts and other tax breaks used by middle-class workers, including cutting the mortgage tax deduction.

A commission looking for ways to close the deficit, and, noting the extent of 401(k) tax breaks, recommends an examination of the system as one way to prevent government bankruptcy.

Besides 401(k)s, other possibilities include the mortgage-interest deduction on second homes, as well as benefits from employer-provided health insurance, which are untaxed now.

Under current 401(k) rules, total employee/employer contributions can’t exceed $50,000. In the proposed rule change, employer/employee contributions would be limited to 20 percent of the employee’s compensation, with a maximum of $20,000, the so-called 20/20 proposal.

Another proposal being discussed in Congress says all tax deductions on 401(k)s and IRAs to be replaced with an 18 percent credit. The credit, according to a proposal that has been endorsed by economist William Gale, would be placed directly in a person’s retirement account.

“Unlike the current system,” Gale told Congress, “workers’ and firms’ contributions to employer-based 401(k) accounts would no longer be excluded from income and would be subject to taxation, contributions to IRAs would no longer be tax-deductible and any contributions to a 401(k) plan would be treated as taxable income.”

In other words, the employee and employer would no longer get a deduction under the Gale plan, they would qualify for a credit. And the credit would “increase [government] revenues by about $458 billion,” Gale says.

(Excerpt) Read more at nypost.com …

NC Gov. Perdue Suggests “Suspending” Congressional Elections until Debt Crisis is Over

This is the beginning of the groundwork for a “national leader” to declare a “national emergency”:

As a way to solve the national debt crisis, North Carolina Democratic Gov. Beverly Perdue recommends suspending congressional elections for the next couple of years.

“I think we ought to suspend, perhaps, elections for Congress for two years and just tell them we won’t hold it against them, whatever decisions they make, to just let them help this country recover,” Perdue said at a rotary club event in Cary, N.C., according to the Raleigh News & Observer. “I really hope that someone can agree with me on that.”

Perdue said she thinks that temporarily halting elections would allow members of Congress to focus on the economy. “You have to have more ability from Congress, I think, to work together and to get over the partisan bickering and focus on fixing things,” Perdue said.

Read more: http://dailycaller.com/2011/09/27/nc-governor-recommends-suspending-democracy-to-focus-on-jobs/#ixzz1ZCLiJncI

CBS NEWS Poll: 63% of Americans Oppose Raising the Debt Ceiling

http://www.hapblog.com/2011/04/poll-63-of-americans-oppose-raising.html

Sen. Rubio: Lack of Leadership, a President who has been Absent, and the Lead Negotiator on a 5-Day Foreign Trip—- We are Headed for a Debt Disaster

U.S. Senator Marco Rubio has expressed his concerns over this very issue in a tersely worded statement stating that, “The absurdity of what we have witnessed on the Senate floor is only eclipsed by the lack of leadership demonstrated by the White House, and a President who has been absent from this debate and even sent his lead negotiator on a five-day foreign trip.”

Rubio has been pushing for a long term budget instead of continuing to push for 2-3 week budget extensions- Rubio believes this needs to be addressed once and for all rather than with these stopgap measures whose primary purpose is to win the ongoing PR battle in the the news cycle.  Rubio also supports a balanced budget amendment- where is the progress in Congress on this bright idea?

“I will no longer support short-term budget plans. While attempts at new spending reductions are commendable, we simply can no longer afford to nickel-and-dime our way out of the dangerous debt America has amassed. It is time our leaders in Washington wake up and realize that we are headed for a debt disaster.”- Senator Marco Rubio

http://shark-tank.net/2011/03/14/senator-rubio-does-not-speak-chinese-calls-out-congress/

To read the rest of Senator Rubio’s remarks, visit our friends at Redstate.com

Today’s Billboard

http://biggovernment.com/publius/2010/10/29/friday-free-for-all-billboard-edition/

(Future Speaker) John Boehner Blasts Congress over America’s Finances

     The National Debt is not a partisan problem nor a partisan creation. It is the product of the abuse of power that has gone in Washington during BOTH parties terms in the Majority. Sen. Boehner, as the Minority Leader, blasts Congress, because America is BROKE:

Treasury asks for “Donations” to pay down the National Debt: Can’t Wait for the PayPal Button!

THIS IS NOT A JOKE:

The U.S. Treasury Department accepts gifts, payable to the Bureau of the Public Debt. Just mail them to the attention of Department G, Post Office Box 2188, Parkersburg, West Virginia, 26106-2188. Make a note in the memo section that it is a gift to reduce the debt held by the public.

For the story: http://news.yahoo.com/s/nm/20091112/us_nm/us_usa_economy_budget_gifts
 

Bernanke to Stay; WH Revises its Numbers

     Taking a few moments from his vacation on Martha’s Vineyard, President Barack Obama has announced that he has tapped Bem=n Bernanke to the next term as the Chariman of the Federal Reserve. He is pinning much of his economic hopes on the Republican Bernanke, not just on economics, but as a “bipartisan” peace offering. Many had speculated that Obama would turn to his close ally and advisor Larry Summers as Bernanke’s term neared its end this January. Instead, the Obama team thinks that the continuity of Bernanke remaining will ease some of the market trepidations on Wall Street.

See the story at: http://news.yahoo.com/s/ap/20090825/ap_on_go_pr_wh/us_bernanke;_ylt=AmWDU4erllWuFte0xlrou32s0NUE;_ylu=X3oDMTJwYzJhdm0wBGFzc2V0A2FwLzIwMDkwODI1L3VzX2Jlcm5hbmtlBGNwb3MDMQRwb3MDMgRwdANob21lX2Nva2UEc2VjA3luX3RvcF9zdG9yeQRzbGsDb2JhbWFicmVha3N2

Meanwhile, back in Washington, the WH Budget Director has revised the WH numbers, on GDP, unemployment, the deficit, reflecting that the Obama administration had issued statements that were not fully researched, and giving pause to the ObamaCare figures that have been touted thus far.

For story: http://news.yahoo.com/s/ap/20090825/ap_on_go_pr_wh/us_obama_economy;_ylt=ArfthSAGe7LwlScciSL1QpSs0NUE;_ylu=X3oDMTMydGtiNnQ3BGFzc2V0A2FwLzIwMDkwODI1L3VzX29iYW1hX2Vjb25vbXkEY3BvcwM0BHBvcwMxBHB0A2hvbWVfY29rZQRzZWMDeW5faGVhZGxpbmVfbGlzdARzbGsDd2hpdGVob3VzZXBy

Warning: Link Contains Disturbing Images; May Invoke Deep Anger

Open and weep!

http://www.usdebtclock.org/