One month in, 2017 looks like a quiet year for pension issues in Congress.
On Monday, the chief tax policy mover in the House, Ways and Means Chair Kevin Brady, said Social Security revamping is not on the near horizon while his counterpart in the Senate, Finance Committee Chair Orrin Hatch, put pension reform in the “would like to do” instead of the “probably will do” bucket.
With Republicans controlling both houses of Congress and the White House, bigger issues like health care and tax overhauls are taking center stage since there are a limited number of days before the next election cycle heats up in January 2018.
In the much slower paced Senate, floor time is considered the most precious commodity in Washington.
But while direct action on post-working life nest eggs is unlikely (such as starter IRAs and changing the rules to spur the growth of joint pension plans among small companies), legislation aimed elsewhere could have a decided impact on retirement wealth and spending for individuals, said Dallas Salisbury, the dean of Washington wonks on this issue.
“Health savings account expansion, lower individual and corporate tax rates, exclusion from tax of interest or dividends, limitation of itemized deductions, etc., all have a substantial impact on sponsor and participation/contribution decisions that end up having a major impact on defined benefit, defined contribution, IRA, etc., design and savings and funding and investment decisions,” said Salisbury, longtime president, now emeritus, of the Employee Benefits Research Institute.
While Washington usually acts only on crises, Social Security isn’t due to run out of money until 2034.
The crisis exists today only in the Cassandra letters of political action committees who realize that scares aren’t as sure of a way to separate people from their money as taxes, but pretty close to it.