Keep 'em Dependent

AARP is out with a new poll this week that shows 60% of Wisconsin workers over the age of 45 fear they won't have enough saved for retirement.  It paints an ominous picture doesn't it?  Factories, offices and malls someday filled with elderly men and women--some with walkers and canes--trying to eke out a living instead of spending the day watching Judge Judy and Wheel of Fortune while talking to their small dogs.

But, as usual, AARP doesn't delve into why those workers haven't saved enough for retirement.  The poll doesn't ask if those folks have borrowed to purchase every car they have ever owned.  What their balances are on their credit cards--and how much interest they have paid on the three or four gaming systems they have bought the kids for Christmas every couple of years.  There is no indication as to how many of those 60% did no-money-down mortgages--or opened home equity lines of credit.  How many have still found money to smoke, to buy a case of beer every week or are on a first-name basis with the cashiers at McDonalds and Starbucks?  Wouldn't AARP want to know WHY just as much as HOW MANY haven't saved for retirement?

Well I can tell you why AARP doesn't care about the cause of retirement insecurity--because it relies on retirement insecurity for its very existence.  If we had a nation of financially secure seniors, AARP would lose all of its power.  This is no longer the organization that gets you a ten percent discount on your Early Bird Special at Denny's or five dollars off your subscription to Readers Digest.  AARP is a powerful lobbying group and political action committee whose main business is Government dependence.

What is AARP's recommended solution to the "problem" that it sees with the results of its incomplete survey?  Wisconsin setting up Government-run private investment accounts--where people who don't have retirement plans offered through work can save for their golden years.  These retirement accounts sound a lot like Standard and Roth IRA's--which are offered at thousands of financial services offices in almost every town in Wisconsin don't they?  They are more portable than 401(k)s and offer tax advantages either on the front end with Standard IRA's or on the back-end with a Roth.  A system is already in place--in the private sector--to provide the very services that AARP (and Legislative Democrats) want to duplicate in State Government with twice the employees, twice the expense and lower returns on investment.

Now if AARP offered investment services--like they offer Medicare Supplement Insurance plans and Medicare Part D prescription drug plans (both programs they lobbied heavily in favor of in Washington) they would probably be more on-board with encouraging people to invest with someone other than Uncle Sam.  Of course, if people started doing too well in their retirement savings, they wouldn't be so scared about reductions in Social Security or Medicare benefits--and then what would AARP use to boost it's membership?  You gotta keep the cash flowing in to battle against mandatory drivers license testing for Seniors too.