True Free Market Proponents Should Support Private-Public Competition

[xchrom]

http://www.commondreams.org/view/2014/02/19-0


Barack Obama announced "MyRA" at his recent state of the union address. (Photograph: Rex Features)

One of the initiatives President Obama announced in his State of the Union Address was the "MyRA," an IRA that workers could sign up for at their workplace. The MyRA would be invested in government bonds and provide a modest guaranteed rate of return.

The MyRA has several useful features. It's simple, it has low administrative costs, workers can have money deducted directly from their paychecks, and it has no risk. It also has the great advantage that President Obama can make MyRAs available to workers without seeking congressional approval.

However there was one very notable downside to the MyRA. Workers could not accumulate more than $15,000 in these accounts, at which point they would be required to fold their MyRA into an IRA run by the financial industry. People who commented on this requirement all assumed that this was a sop to the industry.

When the accounts are small, the industry wouldn't make any money on them anyhow. Once they get to be a decent size the government will require savers to park their money with a bank or brokerage house. This is nothing but good news for the industry.

[Trekologer]

1. But but but the government can do with less overhead so private business couldn't compete

The same folks simultaneously argue that the government can't do anything efficiently so we must hand over to private business.

[joshcryer]

2. That was Wyden's point with the single payer poison pill.

He basically said "we need something to waive this, and if states can show their 'alternate' methods can work, then they can be adopted." I know the OP is about MyRA but I think it applies to the ACA too.