May 11, 2017
By Steven Wishnia and Neal Tepel
Washington, DC – The Senate voted May 3 to repeal an Obama-era rule that lets states sponsor their own retirement-savings programs for low-income workers.
The vote was 50-49, largely along party lines. The state-run plans “might not seem too bad on the surface,” said Majority Leader Mitch McConnell (R-Ky.), but “what they really add up to is more government at the expense of the private sector and American workers.” The state plans have a competitive advantage over private plans, he added, and Republicans also object that they are exempt from some federal investment regulations. Several states, including Illinois, California, Connecticut, New Jersey, Maryland, Oregon and Washington, have begun offering such plans—individual retirement accounts managed by investment professionals—since the rule went into effect last year. “Instead of encouraging greater competition that will help 55 million Americans save money for retirement, some of my colleagues appear to be listening to Wall Street lobbyists who want less competition and who want to take away a retirement savings option from people,” said Sen. Tammy Duckworth (D-Ill.) Read more