Another last-minute regulatory initiative by the Obama Administration has made its way into the dustbin. Investment News reports:
President Donald J. Trump on Thursday signed into law a resolution that nullifies Obama-era retirement rules meant to encourage cities and other municipalities to develop auto-IRA programs for private-sector workers.
The regulation, issued by the Department of Labor a month before Mr. Trump took office in January, was meant to ease liability concerns among cities when creating automatic-enrollment, payroll-deduction individual retirement account programs to be offered through the workplace.
The Obama Labor Department rules were aimed at addressing a real crisis—chronic under-saving for retirement. But granting cities the authority to create new publicly administered plans with reduced regulatory oversight creates its own set of problems. State and local pension funds for public employees have been managed utterly incompetently, and there are legitimate worries that newly created plans for private sector workers would be vulnerable to similar mismanagement, leaving workers unprotected.
Now that the GOP has successfully overturned an attempted Democratic fix for the retirement system, it has a special responsibility to address this increasingly pressing problem in a comprehensive way—ideally through bipartisan legislation, rather than regulatory directives. The good news is that there are many good ideas out there, and that a number of legislators seem to be taking them seriously.