For the uninitiated, the open MEP allows companies to pool their retirement plans together under one common trustee. This offers multiple advantages. First, it removes nearly all of the critical fiduciary liability from the company officers (and the company itself). Second, it frees up time for company executives to focus their attention on revenue generation, not employee benefits. This is especially critical for smaller companies were the executive staff is already overburdened.

Finally, by pooling plans from many companies, the MEP can reach an asset size that achieves economies of scale when it comes to fees.

Bottom line: 401(k) MEPs are a good thing, and everyone agrees — Republicans, Democrats, even Obama. Now, this doesn't mean they're perfect. Fiduciary accountability issues remain. This was the primary concern of Phyllis Borzi and the Obama DOL. It's not that these issues can't be addressed. Certainly Congress and the Obama administration suggested they were on the cusp of doing so.

But it never happened. The states then stepped into this subsequent void. Was the void purposely created as a political payoff to friendly state administrations? We will never know for sure, but the list of states and politicians involved and their relationship with the previous administration might offer some clue.

Whatever the reason, the void provided an opportunity for the states and they filled it.

There was only on problem. The cost of ERISA compliance meant the states would have a difficult time competing with existing private employee retirement savings alternatives. Just as quickly as the Obama administration, without any consultation with Congress, stripped these employee protections, President Trump, in league with both the House and the Senate, restored them.

Undaunted, however, the states continue to make plans to go ahead with a publicly financed product to compete with the private retirement market. Furthermore, they have the power within their legislatures to compel private employees to divert a portion of their salaries to a state-sponsored retirement plan. In this way, they can use the same "opt-out" methodology popularized by the 2006 Pension Protection Act, or, it being the state, it can simply mandate that employees save for retirement the same way mandatory payroll taxes are removed from your paycheck to fund Social Security.

While this certainly raises the question of just how much a free society will allow its duly elected government to control individual decision-making, there remains a practical problem that has, to date, received very little attention. In the grand scheme of things, who retains the fiduciary liability under these plans? Is it the state that sponsors them? It is the employers who make the affirmative choice to not offer their own plan and, instead, place employees' moneys with the state? Or is it the employees themselves, who, barring any mandate, opt into the state plan by not opting out?

Until this question of fiduciary accountability is definitively answered, state-run retirement plans will continue to present a risk to both employers and employees. Unfortunately, we'll have to wait for the first lawsuit to make its way through the courts to discover that answer.

And by that time, it may be too late for any retirement savers already harmed.