Bill Raising Contributions on IRAs, 401(k)s Gains Momentum
W A S H I N G T O N, Sept. 12 -- After two years of Republicans passing taxcuts and President Clinton vetoing them, the one tax measure withbroad appeal to middle-class voters that could still become lawthis year would raise contribution limits for IRA and 401(k)retirement plans.
Earlier this summer, the House passed its version of thelegislation with 401 votes in favor. Last week, the Senate FinanceCommittee unanimously approved a somewhat different package.
“It’s getting a bit of steam, and well it should,” said Sen.Max Baucus, D-Mont.
White House Wants a Compromise
Last year, Clinton vetoed a 10-year, $792 billion GOP tax cut —it included similar retirement provisions but was vetoed for otherreasons — and has vetoed bills this year that would have eliminatedinheritance taxes and reduced the tax marriage penalty ontwo-income couples.
The Clinton administration has expressed concern that theretirement package wouldn’t do enough to help lower-income peoplesave, but those reservations may not withstand an election-yearCongress eager to pass the measure by veto-proof majorities.
“There should be no reason for any further resistance by theClinton administration to ultimately signing these provisions intolaw,” said James Klein, president of the Association of PrivatePension and Welfare Plans.
A White House spokesman said Monday that the administration isworking toward compromise.
“We’re very hopeful we can reach agreement with Congress on apackage of pension reforms this year which is consistent with ourcommitment to fiscal discipline,” said Patrick Dorton, spokesmanfor economic adviser Gene Sperling.
By any measure, Americans are abysmal savers. In 1999, savingsas a percentage of personal disposable income fell into negativerange for the first time since 1933. Some analysts estimate thathalf of all Americans have less than $10,000 in savings.
Social Security Faces Insolvency
