Scott Bruun: Ted Wheeler’s Wheel of Big Government Solutions
Wednesday, March 25, 2015
Think about that for a moment. Our state treasurer has scrambled over the dark chasms and bus-sized slabs of ice in the treacherous Khumbu Icefall. He’s made his way through the desolate Western Cwm and up the Lhotse Face, a sheer wall of ice over a thousand meters long. From there, Wheeler traversed the Yellow Band and the South Col into the death zone.
On summit day he climbed over the Hillary Step, forty feet of knife-sharp vertical rock; then ascended the last long ridge, step by painful-step, before finally reaching the summit of Everest. At 29,028 feet above sea level, Ted Wheeler has stood on top of the world.
Then he made it back down. Which any mountain climber will tell you is even more dangerous, and more impressive.
State Treasurer Ted Wheeler is impressive. He has degrees from both Stanford and Harvard, two fine alternatives if you can’t get into U of O. In politics, Wheeler made his mark at the Multnomah County Commission before being appointed and later elected as state treasurer. As treasurer, Wheeler has earned high marks for his fiscal management and no-nonsense approach to office protocol.
Wheeler is also ambitious, it’s long been noted that he wants to be governor. Ambition is not a bad thing in politics, of course. Show me someone in politics without ambition and I’ll show you someone who won’t last long in politics, and certainly won’t accomplish much for his or her constituency.
A challenge for Wheeler’s ambition, though, has been his position as treasurer. The role of state treasurer is for the most part a behind-the-scenes job. If a treasurer does the job well, chances are you won’t hear much about it. The last thing Oregonians want to see are revelations about the state treasury, or the state treasurer, splashed across the front page of a newspaper.
So instead, Wheeler has tried to make a splash with some high-profile proposals; including his idea to use bonded debt to alleviate student debt, and his plan for a state-run 401k-type retirement plan. For these, Wheeler earns an “A” for effort. But the policies themselves deserve a failing grade.
Nevertheless, a person who has the drive and discipline to climb Mount Everest certainly isn’t going to stop after one set-back. Not if the goal is Mahonia Hall or the office of Portland mayor, two of Oregon’s tallest political summits. Which leads us to Ted Wheeler’s Big Government Solution 2.0, a state-run 401K program.
This idea, now under consideration in the legislature, would establish a new program run privately but controlled by the state. It’s based on the fact that many Oregon employers don’t offer retirement savings plans, and that many lower-income Oregonians don’t participate in retirement savings even when plans are available.
It is good to avoid cynicism. Yet it’s also fair to point out that Oregon has not done so well lately with “state-run” ventures. Considering the hundreds-of-millions spent to study a bridge over the Columbia River, to the hundreds-of-millions spent to build a website for Cover Oregon, we should be skeptical toward any sweeping “solution” offered by the state. Oregon’s state government simply does not have the track record or trust needed to manage, or quasi-manage, hundreds-of-millions of retirement dollars in the private investment world.
Nor is a state-run plan even necessary. Not every employer offers a 401K, but just about every bank and financial institution in the United States offers an IRA plan of some sort. Certainly it would be better if more Oregonians used 401Ks or IRAs to save for retirement. Just as it would be better if more Oregonians turned off the TV, ate kale, and volunteered locally. Good things all, but not things state government should be managing.
There is much to admire about Ted Wheeler. But his goal of a state-run 401k is a false summit. The real issue is not the means of saving, which are plentiful. Instead, the real issue is the shortfall of available funds from workers to save.
Toward this, Wheeler and other state officials should work to create an economic environment where good jobs are created in the private sector. They should work to build healthier economic conditions in Oregon, so that workers can improve their earnings and, therefore, their ability to save.
Finally, state officials should revamp the tax code so that workers have greater incentives, through deductions and credits, to save. In other words, if we truly want people to save more then we should tax their savings less.
It’s not 29,028 feet. But earning more, and keeping more of what we earn, may just be a sunlit summit for the rest of us.
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