Will the 401(K) Mep Become the Penicillin of Retirement Saving?

Information may not be reliable

In early March 1942, Anne Miller no doubt wondered if she would live to see spring.

She lay dying in a New Haven Hospital. Four weeks earlier, as February temperatures unseasonably soared into the 50s, she had miscarried.

She was now suffering from streptococcal septicemia, a common infection often associated with miscarriages. In the ensuing weeks, as the waning winter gasped a wave of single digit frigid air, Miller’s body temperature reached a peak beyond 106 degrees. She didn’t have long to live.

By a rather remarkable coincidence, down the hall lay another patient by the name of John Fulton, whom her physician, John Bumstead, was also serving.

After exhausting all treatment possibilities for Miller, Bumstead was left with no choice. He approached Fulton, who was good friends with Australian researcher Howard Florey, to ask Florey for some of the new medicine Florey had been working on.

On Thursday, March 12, Fulton made the call. Fortunately, Florey had earlier visited Merck and Co. and convinced them to produce a small quantity of his experimental drug. By Saturday, March 14, a portion of that was flown to New Haven and delivered by State Police to New Haven Hospital.

At 3:30 that afternoon, Miller received her first dosage intravenously, her fever having peaked at 106.5 degrees. The extremely high temperature caused her to float in and out of consciousness.

That night, her fever broke and by the morning her temperature returned to normal. By Monday, March 16, her appetite back, she consumed four full meals. A few days later it was spring and the outside temperature surpassed 70 degrees. The 33-year old Miller would live another 57 before dying at the age of 90 in May, 1999.

You’ve probably guessed the name of this miracle drug – Penicillin.

What you might not know is Penicillin was discovered 12 years earlier. Indeed, the original discoverer of Penicillin, Alexander Fleming, stopped working on Penicillin in 1935.

I tell this story because, after talking with Terry Powers (see “Exclusive Interview with Terrance Power: 401k MEPs Reduce Downside Risk for Company Execs,” May 17, 2016), I’m convinced that decades from now people will look back and wonder “What took them so long?”

Headlines continue to ring of an alarming lack of retirement savings. Some pundits cite statistics claiming nearly half of the American workers are not covered by a company retirement plan.

This, in turn, has fueled more than a dozen states to consider offering their own public retirement plan alternative for private workers.

Here’s the more interesting fact. It’s clear opening up the floodgates of Open 401k MEPs will allow the competitive marketplace to find low cost, high efficiency, alternatives to both current company sponsored 401k plans and, well, nothing (as in, no company sponsored retirement plan).

There’s little argument there (well, at least it’s “little” enough that any reasonable argument can also be easily – and reasonably – countered).

So, what’s holding things up?

It appears the White House is on board, having allocated some money in its proposed budget for this area. In addition, there’s bipartisan support for the idea (and there has been for years).

Still, for all the talk and posturing, nothing has been done. Why not?

If there’s something we’ve learned from this presidential campaign, it’s that, when something that makes common sense doesn’t get done, there’s always a reason. And that reason usually involves a vested interest that stands to gain from the status quo.

Dear reader, who stands to gain the most by thwarting the effort to create the promise of universal retirement plan coverage via the private market?

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Contact me at tpower@ThePlatinum401k.com or at 813.774.3366 for more information about 401k Outsourcing. We've worked with multiple employer plan clients for over 25 years and are the industry leader in this niche field. We work with advisers and clients all over the country to reduce cost and employer liability.  There's more information available on our website at www.ThePlatinum401k.com.