Sunday, September 20, 2009

Golden Public Pensions

"Golden Public Pensions need dose of Private Reality" says the JSEB on September 19. Actually, parents should no longer send their kids to college to compete in the private sector. Get enough education to secure and hold a government job. Government bureaucracies are still hiring and expanding and the pensions of government employees expand.

As to the private sector, half of which can't afford pension plans and when they do they are subject to large IRS fines. Read the article in the WSJ on September 19 and you see what problems the private sector encounters when seeking advice on setting up a small business pension plan. Congress changed the law in 2004 believing that many pensions were tax shelters costing the Treasury billions of dollars. The law was enacted to catch the biggies but guess who got caught in the middle of advise from advisers, certified tax accountants and attorneys. The little guy now faced with hundreds of thousands of dollars in fines.

Finally, Chuck Grassley and Max Baucus issued statements that they hope to change the law that mandated the fines.

Hope to change a bad law that probably few small business owners had the money to hire New York and Chicago tax accountants for advice in drawing up the pension plans for themselves and their employees.

Another example of how changes have possible unforeseen consequences. A thousand page health bill is tailor made for tort attorneys. Who doesn't want the "tort" taken out of attorneys?


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