Many social changes do not occur in the blaze of national publicity but work their way under the radar, slowly changing society one person at a time. Such a change may be the 401(k) revolution, the rise of defined contribution pensions, or more exactly, the rise of pre-tax individual savings plans. Donald Lambro at the Washington Times celebrates their huge expansion.
The numbers are astounding and explosive: Since 1990, total worker assets in 401(k) plans have grown an average of 13 percent a year, from $385 billion to an estimated $2.1 trillion in 2004... says the Investment Company Institute.
At $2.1 trillion, we are talking about real money. But what political junkies want to know is: Does this change the political balance in the United States towards an ownership society?
"Investors, regardless of income, gender or race, vote more Republican than non-investors," tax cut crusaders Grover Norquist and Cesar Conda wrote in a Wall Street Journal analysis about the effect of President Bush's tax cuts.
But there is another thing to think about. While the ranks of investors grow what about the people left behind? What about the dependent classes, the rank-and-file of the Democratic Party who live by remittances from the government: from government programs, from government jobs, and from government pensions? These people have a completely different outlook on life, and live lives that depend, until their dying day, upon the continuance of that check from the government. For the last half century the Democrats have been happily growing the ranks of the dependent, instinctively understanding that their political support comes from the dependent classes.
When will the clash come between these Two Nations, between the defined contribution nation and the defined benefit nation?
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