Thursday, August 17, 2006

The Feds and "Libertarian" Paternalism

President Bush today signed into law the Pension Protect Act of 2006. Why the federal government -- or any government in the U.S. -- is in the business of regulating and insuring pension plans is another whole story, as they say. (See this for a general treatment of the erosion of the Constitution's meaning. See this about liberty of contract, which applies to the States.)

In reading McGuireWoods's detailed summary of the act, I am especially struck by this:

The Internal Revenue Service (“IRS”) has permitted automatic enrollment of employees in 401(k) plans since 1998. The PPA adds a number of provisions to the Code and ERISA to facilitate and encourage automatic enrollment.

A victory of sorts for "libertarian paternalists." A defeat for liberty and, in particular, liberty of contract and the right to make decisions and learn from their consequences.

Related post: Another Voice Against the New Paternalism (with links to several other related posts)