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State-Run Retirement Plans for Private Sector Workers?

There’s no doubt that the federal and state governments have far exceeded their core, constitutionally-established functions.

HB 899, North Carolina Work and Save, would unfortunately continue that trend, and should be stopped.

The bill would establish a retirement fund to be managed and administered by the state government, to be offered to private sector employees working for companies that don’t offer retirement funds.

The reasoning behind the bill, as laid out in the bill’s language, is that “too many North Carolina citizens have no or inadequate savings for retirement.”

I thought Social Security, you know the federal government’s ponzi scheme with more than $21 trillion in unfunded liabilities, was supposed to provide economic security for retirees.

At any rate, not every real or perceived problem requires a government program.

Running a retirement fund for private sector employees simply falls outside the proper core functions of state government.

The bill calls for $1 million in taxpayer dollars over the biennium to establish and manage the fund. This amount is supposed to be enough to manage the fund until it becomes self-sufficient through the collection of fees. However, no other state has established such a fund that has become self-sufficient.

Moreover, the lack of retirement savings by workers is not a byproduct of a lack of options. There are countless brokerage firms people can use to easily set up a retirement account online.

Instead of expanding the scope of state government to establish another alternative for a retirement fund, something for which countless options already exist, legislators should focus on continuing to let workers keep more of what they earn.

 

Brian Balfour / Senior Vice President of Research

Brian is Senior Vice President of Research at the John Locke Foundation