Because he has done so little, or, more accurately, so little that has gone right, Joe Biden is still spending time talking about the American Rescue Plan. This legislation from March 2021 keeps making it into Biden’s speeches and his Twitter account more than a year and a quarter after its passage.
No, he hasn’t been talking about how the ARP’s $1.9 trillion in spending helped stoke the historic inflation we are seeing (he still seems to be surprised that something called “stimulus” checks stimulated the economy).
He also isn’t mentioning how the American Rescue Plan lowered the 1099-K reporting requirements that went into effect January 1, targeting not mega-corporations but hobbyists, side-giggers, and small online sellers. It reduced IRS reporting triggers from sites like eBay, Etsy, and Venmo from a threshold of more than $20,000 in gross payments in a given year to a mere $600. Of course, he and his administration will tell you it was to go after all the billionaires … with $600 worth of income activity.
No, here is what Biden has been saying, per a recent tweet:
“Imagine working 40 or 50 years. Working hard. Doing everything right to provide for your family. And your pension goes insolvent through no fault of your own. I did something about it. The Butch Lewis Act will keep multiemployer plans solvent for decades to come – until 2051.”
Now, imagine working 40 or 50 years and having inflation and gas prices go through the roof through no fault of your own. And imagine the value of your 401(k) holdings going down double digits — again, not your fault. But I digress.
According to the Biden administration, that Butch Lewis Act legislation as part of the ARP will protect the retirement funds of 2 to 3 million union workers and restore benefits to more than 80,000 workers who already saw cuts.
First, the Act doesn’t actually solve the issue for these funds; it just kicks the can down the road (shocking, I know).
PLANSPONSOR, an information and solutions resource for the retirement benefits industry, puts the change as impacting “hundreds of thousands of union pensioners and their families, who stood to lose as much as 40% of their promised pension payments.”
Littler, an employment and labor law firm, said, “Notably, the bill does not include structural reforms to the multi-employer program, which many feel are necessary to ensure the long-term viability of these types of plans.”
Moreover, while Biden was worried about the union members’ pensions taking a dive because of their structuring, he seemed to have missed the large number of Americans who cared about the nosedives their 401(k)s have been taking. In response to his above tweet, words related to “401k” began to trend on Twitter.
Per the Census Bureau’s most recent Wealth Report, 57.3% of American households have retirement plans like IRAs, 401(k)s, etc. and 22% have non-plan investments in the stock market.
Yahoo! reported in June 2022 that according to the Center for Retirement Research at Boston College, “Americans lost $1.4 trillion in their 401(k) accounts and another $2 trillion in IRAs” from the beginning of the year.
So, instead of finding ways to stem inflation, thwart a recessionary environment, stop the debasement of the dollar, and secure Americans’ economic future, Biden is out touting kicking the can down the road for a select group of union members.
We should ensure that all Americans who have worked, done the right things, saved, and invested don’t find their economic reality whipsawed through no fault of their own. They deserve their retirements to be safe and stable, not at the whim of capricious politicians and Federal Reserve officials.
But if Biden is going to pick winners and losers instead, maybe he shouldn’t brag about it.