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Bipartisan Initiative Seeks to Boost Savings, Retirement Readiness

Many sobering reports have been issued regarding the degree to which U.S. workers are preparing — or not — for retirement. The Bipartisan Policy Center’s (BPC) Personal Savings Initiative (PSI) may not be the first effort that seeks to help turn the tide of poor savings rates, but it has heft and features a far-reaching and ongoing discussion of the problem and ways to address it. Former Senate Budget Committee Chairman Kent Conrad and Jim Lockhart, who served as Social Security Administration Deputy Commissioner and PBGC Executive Director under President George W. Bush, are leading the initiative. 

In making the case for launching the initiative, Shai Akabas, Brian Collins and Alex Gold argued in BPC’s blog that increased savings will help address poor retirement preparedness. They observe that the despite federal tax code’s “substantial advantages for retirement savings, just over half of working-age households participate in workplace retirement plans, and many still do not have access to a retirement savings account at work.”

Said Conrad in announcing the initiative, “Fundamental changes to federal and private retirement plans have made saving for retirement more complicated and less certain. Changes in private companies’ retirement plans, complex federal laws and lack of retirement education mean that only 46% of all workers reported having access to a workplace retirement savings plan, and only 38% were currently contributing, according to a study by the Employee Benefit Research Institute.” Lockhart added, “Researchers across the political spectrum have come to the same conclusions — a significant portion of Americans are on track to have a lower standard of living than they do now and many of these households risk running short of money for basic necessities, like health care and housing.”

The initiative “will devise specific recommendations to begin to remedy these shortcomings,” said Conrad. The initiative will look at: 

  • the impact of federal policies that encourage and discourage savings, including the tax code; 
  • the finances and operation of Social Security Disability Insurance (SSDI) and its interaction with private disability insurance;
  • the interaction between Social Security and private savings, including DB and DC  plans; 
  • the impact of long-term care needs on retirement security; and 
  • the role of homeownership and student debt. 
Over the next year, the BPC plans to: 

  • hold roundtables and issue white papers highlighting challenges related to retirement savings, DC accounts, annuities, SSDI, and how housing, student loan debt and savings intersect;
  • develop policy recommendations to address Americans’ future savings needs; and
  • model the recommendations’ impact on retirement security and the federal budget. 
BPC will release the initiative’s final recommendations early in 2015. In addition to Conrad and Lockhart, the BPC commission conducting the initiative includes: 

  • Todd F. Barth — President, Bowers Properties Inc.; Texas Teacher Retirement System Board member 
  • Jeff Bingaman — former Democratic U.S. senator from New Mexico; former Senate Committee on Energy and Natural Resources Chairman; former member, Senate Committee on Finance and Senate Committee on Health, Education, Labor, and Pensions 
  • Charles P. Blahous III, Ph.D. — Public Trustee of Social Security/Medicare; Research Fellow, Mercatus Center and Hoover Institution
  • James H. Douglas — former Republican governor of Vermont; Executive in Residence, Middlebury College; BPC Governors' Council member
  • David Dreier — former Republican U.S. House member from California; former House Rules Committee Chairman; Annenberg-Dreier Commission Chairman
  • Gail D. Fosler — President, GailFosler Group LLC; former Conference Board President and Chief Economist
  • William G. Gale, Ph.D. — Urban-Brookings Tax Policy Center Co-Director; Retirement Security Project Director; Senior Fellow, Economic Studies
  • Teresa Ghilarducci — Professor, Bernard L. and Irene Schwartz Chair in Economic Policy Analysis, The New School; Director, Schwartz Center for Economic Policy Analysis, The New School
  • C. Robert Henrikson — former MetLife, Inc. Chairman of the Board, President and CEO
  • Brigitte C. Madrian, Ph.D. — Aetna Professor of Public Policy and Corporate Management, Harvard University
  • Lisa Mensah — Executive Director, Initiative on Financial Security, The Aspen Institute
  • Robert D. Reischauer, Ph.D. — Former Director, Congressional Budget Office; Public Trustee of Social Security/Medicare; Distinguished Institute Fellow and President Emeritus, The Urban Institute
  • Alan Reuther — former Legislative Director, United Auto Workers
  • Dallas Salisbury — Employee Benefit Research Institute President and CEO
  • Sylvester J. Schieber, Ph.D. — former Chairman, Social Security Advisory Board; Independent Pensions Consultant
  • Antonio R. Villaraigosa — former mayor of Los Angeles; Senior Fellow, BPC

BPC is a bipartisan non-profit organization that promotes solutions, through former elected and appointed officials, business and labor leaders, academics and advocates, to challenges facing the United States through analysis, negotiation and dialogue. Former Senate Majority Leaders Howard Baker (R-Tenn.), Tom Daschle (D-S.D.), Bob Dole (R-Kan.) and George Mitchell (D-Maine) founded BPC in 2007.

John Iekel is Senior Writer and Editor for the ASPPA Net and NTSA Net portals.