Nearly 60 percent of workers in the city do not have access to a pension or a 401(k), said
''It isn't just a matter of people not being able to keep up their standard of living,'' Ms. Ghilarducci said. ''We're talking about people who will be old and in a chronic state of deprivation.''
Ms. Ghilarducci and two others —
The proposed solution seems somewhat counterintuitive at a time when areas around the country are struggling under their pension obligations. But
The city comptroller,
According to Ms. Ghilarducci's research, 59 percent of workers in the city do not have either a pension or a 401(k), up from 51 percent a decade ago. Many small businesses do not have the human resources capacity to manage a 401(k). Moreover, Ms. Ghilarducci says, 401(k)'s are less than ideal for workers themselves, since they charge higher fees and have lower rates of return than pension funds, in part because people can withdraw their money at any time.
In her and
Ms. Ghilarducci compares the proposal to the ''public option'' proposed by liberals during the health care reform debate, because private individuals would be able to take advantage of the negotiating leverage and oversight of the government.
The fund would cost taxpayers nothing, Ms. Ghilarducci says, because workers' contributions would pay the full administrative costs. Also, unlike the defined benefit plans offered to many public workers, the fund's guaranteed rate of return would vary each year based on market conditions.
|Copyright:||(c) 2014 The New York Times Company|
|Source:||New York Times Digital|