A group of 12 Democrats, including Rep. Maxine Waters, D-CA, and Rep. Bobby Scott, D-VA, both ranking members of House committees with jurisdiction over retirement policy, think it's time to update the Employee Retirement Income Security Act.
That's because the rules governing the nearly $12 trillion IRA and defined contribution market have "failed to keep pace with the changed landscape," wrote the lawmakers in a comment letter addressed to Labor Secretary Thomas Perez.
The Department of Labor has posted nearly 1,000 letters since the close of the comment period on July 22. Far more have been sent but have yet to be posted. And tens of thousands of individual signatures to petitions have also been posted.
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Democrats encouraged consideration of "legitimate concerns" emerging from the comment period by stakeholders, but they also said some of those claims are "overstated or outright false."
Specifically, Democrats said the proposed fiduciary rule will not inadvertently harm investors with small accounts. Many opponents of the rule argue that will be an unintended consequence if it is finalized as proposed.
Republican members of the House Education and Workforce Committee, some already on record as ardent critics of the DOL's rulemaking process, also submitted comments, calling on the DOL to withdraw its proposal.
"Our nation's workers, small business owners, and retirees deserve better than this proposal, which will result in less financial advice and higher costs for those saving for retirement," argued Republicans, led by Education and Workforce Chair John Kline, R-MN.
"Like its flawed predecessor, this regulatory proposal should similarly be discarded," they said.
Their comment letter cited the same concerns Democrats claim are overstated—that the rule, as proposed, would adversely affect the country's low and middle-income retirement savers.
Republicans also said the rule will deny small business owners assistance in selecting the right retirement options for employees, and result in fewer small businesses offering retirement plans.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
