Some Democrats want to dismantle IRAs as we know them
The Individual Retirement Account, or IRA, has been one of the great policy successes of the past half-century. Introduced in 1974 as a backstop for workers whose employer-based retirement plans were vaporizing in a terrible economy, IRAs are now held by more than one-fourth of U.S. households. Assets total $12 trillion, more than half the nation’s GDP.
IRAs offer a tax break to encourage savings, which in turn provide capital for businesses to start and grow, adding to employment and prosperity. The IRA is a bipartisan program that’s worked.
But now, in a short-sighted and dangerous attempt to find revenues to help finance a multi-trillion dollar social welfare and climate mitigation package, some Democrats want to dismantle IRAs as we know them. Their plans to slap severe restrictions on retirement plans were passed by the House Ways and Means Committee in September and became part of Build Back Better legislation. As Congress continues debating whether these provisions will remain in the final bill or be stripped – it is important to consider negotiations are ongoing and nothing is locked in stone, yet.
