Editore"s Note
Tilting at Windmills

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March 8, 2005
By: Kevin Drum

BANKRUPTCY AND SOCIAL SECURITY IN ONE POST!....Musing about the Republican party's eagerly anticipated bankruptcy bill, Max asks:

In a different vein, a good question is whether the private accounts and annuities under Bush's excellent Social Security privatization plan would be vulnerable to attachment by creditors, thereby opening up a new source of equity to the credit card industry, after they have sucked out all your blood.

Funny he should ask. Just a couple of months ago a case was argued before the Supreme Court on the question of whether creditors could seize money in IRA accounts. Associated Press reports:

Bankruptcy law already protects pensions, 401(k)s, Social Security and other benefits tied to age, illness or disability. Most justices appeared reluctant to allow the seizure of all the money in IRAs, a nest egg used by millions of people, though Justice Sandra Day O'Connor offered that some accounts might be taken to repay debts.

So IRAs are still up in the air, but private accounts tied directly to retirement would presumably be safe. Until the credit card industry manages to ship Grand Theft Bankruptcy v2.0, anyway.

Kevin Drum 6:09 PM Permalink | Trackbacks

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