I’ve been seeing alot arguments based on imaginary rights lately, and i’d like to compile a list of the various carrots that politicians dangle over the heads of the lowest common denominators, labeled as “rights.” I’ll even start it off with “health care,” and “jobs.” Oh yeah, and add another one to the list: State Sponsored 401(k)s. Very promising, indeed. < / sarcasm >

“After talking with some 401(k) experts, it’s unclear how tough this might be to do. Any system would have to comply with the existing tax code and regulations.

But experts agree that small business owners could use some help — and a state-packaged plan might be a way to do it.”

Or – it could be an investment opportunity. Simply sell your idea to a few providers, and promise that you’ll bring in a few hundred more customers across whom the insurance companies can spread their risk. As far as I’m aware, there are several such middlemen-agencies that line up insurers with small businesses or groups thereof. Or companies like ADP (and I’d imagine a host of others) who specialize in co-ordinating what would otherwise be HR nightmares for male and medium sized (and even large) businesses. But all of this is beside the point.

In the long run, as I believe Keynes said, we’re all dead. So too, in business.

But in the interim, there are really only two sorts of businesses. Those that prosper, and those that fail. Now, the state hasn’t turned a “profit” on any of its previous ventures, for if it had, we wouldn’t be paying taxes (or at least not facing rising tax bills). We’d simply let the state generate all the revenue it needed by providing consumers with things they wanted.

And herein lies the fundamental problem. The state doesn’t generate income, it appropriates it. So when the State funded 401(k) becomes “unprofitable” or “not economically viable,” new legislation or amendments to old legislation will be passed, requiring more money out of my pocket to pay for someone else’s health care. The state doesn’t suffer penalties, and doesn’t obey incentives like a normal consumer would — as unpopular as raising taxes are, it is an inevitability if we wish to provide 401(k)s for people in the future.

All the politicians will have to do is say, “Well, you really like your 401(k)s, don’t you? Well, we just need a little more money…” And faced with the prospect of losing what we’ve been accustomed to, or mortgaging our retirement on someone else’s capability, the masses will inevitably choose the latter.

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Please add your “political carrot” suggestions to the comments section!