Here's something the Obama administration can do to help those who are laid off in this horrible recession. Stop making folks pay outrageous taxes and hefty penalties for cashing out pension plans prior to retirement age. This is money layoff victims could use to live on. Forty percent of it shouldn't go to Uncle Sam just because workers got severed from their jobs through no fault of their own in the worst economic times since the Great Depression.
Savings and unemployment checks alone don't always cover the bills after an unexpected (and often undeserved) layoff. And by the way, those checks are also taxed. Talk about rubbing salt in the wound. Anyone who thinks people who receive unemployment benefits aren't paying into the system, think again. I will pay far more in taxes in this year of unemployment than I ever did when I was working. Something is just not right about that.
Washington could save a lot of money spent on extending unemployment benefits if it would let people in dire predicaments keep the bulk of their pensions funds. It's bad enough that working-class folks won't have that money for their retirement years because of having to withdraw it now to weather this economic storm. But the fact that it's going to the IRS is downright immoral.
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