Ever wonder why journalists rank about as high as Boko Haram on the popularity scale with the general public? (Rhetorical question)
Reason No. 1,547,663 is a recent story in The Washington Post; a straight news story, mind you, not an opinion piece. Here’s the lead:
We already know that the 401(k) has not been a great solution for improving Americans’ retirement security. But a series of new—and slightly depressing—charts from the Economic Policy Institute point out more of the ways that the retirement accounts are falling short.
Lies, damned lies and statistics. The tell is the author’s assertion that 401(k)s exacerbate “income inequality,” which immediately piqued our partisan radar. What she doesn’t say is that the Economic Policy Institute is a labor movement-affiliated think tank founded by Robert Reich, former Clinton Administration labor secretary and popular progressive writer.
Not surprisingly, many in the labor movement—particularly government workers—still love their defined benefit pension plans, even as they’ve gone the way of the dodo for the vast majority of their private sector counterparts. And who can blame them?
We have no quarrel with the Economic Policy Institute, which wears its political stripes on its sleeve (even though it still nonetheless describes itself as nonpartisan). We have a big problem with The Washington Post, which conveniently fails to mention EPI’s affiliations, founders or funding sources; it simply presents the findings as fact. Those tempted to lean on the nonpartisan tag described above should remember all think tanks bill themselves as nonpartisan, which is how they maintain their 501(c)(3) tax-exempt status. Anyone want to argue the Center for American Progress or American Enterprise Institute are apolitical?
As for the supposed failure of the 401(k), plenty of charts exist that tell a very different story, as well as first-hand accounts of saving success. Alicia Munnell of the Center for Retirement Research at Boston College—who could hardly be labeled industry shill or right-wing sycophant—recently had her road to Damascus moment, and finally admitted that her research finds 401(k) plans and like savings vehicles on par with defined benefit replacement rates.
Expect more deceit on the subject from the consumer press —it’s an election year.