Despite a series of crises dominating the attentions of the White House and the news cycle, President Donald Trump managed to find time to kill an innovative new program designed to help workers where they need it most — their retirement.
On Wednesday night, the White House announced Trump had signed House Joint Resolution 66, a measure that effectively kills the ability of states to create programs addressing the coming retirement crisis.
Over the last 30 years, income inequality in the U.S. ballooned as more and more Americans were shuffled into low wage work. As a result, fewer and fewer Americans are able to save for retirement. Currently, nearly half the U.S. workforce does not have a retirement plan through their employer and nearly 40 million households have absolutely no retirement savings.
But the state of California sought to change that with the development of a landmark new experiment in nest-egg building called California Secure Choice. Under the law Californians who didn't receive retirement plans through their employer would be automatically enrolled in a state-run program. Gov. Jerry Brown signed the bill last September, and it was slated to go into effect in 2019.
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That was, until Trump and congressional Republicans stepped in. Using the Congressional Review Act, a law that allows Congress to get around the Senate filibuster to pass certain resolutions, the GOP nullified an Obama-era regulation that allowed states to experiment with the kinds of programs that California had proposed.
The U.S. Chamber of commerce and the mutual funds industry both supported the Republican measure, presumably because they feared competition from a state-run retirement system — though the California plan was designed to simply fill in the gaps where plans weren't already offered.
"There's absolutely no justification for any effort to reinvent the retirement savings system in order to give primacy to government-run plans," Sen. Orrin Hatch (R-Utah) said.
Throughout the Obama administration, Republicans' frequently touted the principles of "states' rights" and claimed that the states should be allowed to experiment with their own solutions to societies problems as "laboratories of democracy."
But as soon as they took power their agenda changed. "At the behest of the financial services industry, Republicans just overturned a rule that helps American workers save for retirement." Sen. Kamala Harris (D-Calif.) tweeted after the resolution passed the Senate.
At the behest of the financial services industry, Republicans just overturned a rule that helps American workers save for retirement.
— Kamala Harris (@SenKamalaHarris) May 3, 2017
It's not clear whether California has any recourse to try and revive their plan.