Today, a House committee is poised to mark up a plan to block the Obama administration's so-called "fiduciary rule," which would restrict the investment choices of holders of 401(k)s, IRAs, health savings accounts, and Coverdell education accounts. Below is a statement by Competitive Enterprise Institute senior fellow John Berlau, in praise of the House effort:
CEI applauds the House Appropriations Committee for blocking, in its expected markup today, the Labor Department's fiduciary rule. The DOL is not only stepping out of its authority by trying to remake the brokerage and IRA industry, it is premising the rule on what it believes is the stupidity of American investors.
On page 4 of the proposed regulation, DOL expresses the view that "seldom" can Americans "prudently manage retirement assets on their own," and that they "generally cannot distinguish … good investment results from bad." This is some chutzpah from an administration that blew $500 million on the Solyndra boondoggle!
By forcing investment professionals who never claim to provide investment advice — from brokers to custodians of self-directed IRAs — to adhere to a "fiduciary" standard that meets the government's definition of "best interest" — the DOL will cause millions of investors to lose access to low-cost brokerage services and choices of investment strategies for their IRAs and 401(k)s . The DOL should scrap this rule and Congress should instead empower Americans by allowing more investment choices.
Related: Obamacare for Your IRA