Democrats, AARP, labor groups and some small businesses want to explore a rather novel idea -- a statewide retirement saving plan for Oregon workers, about half of whom lack such accounts.



So why did the financial industry fight legislation setting up --horrors! -- a task force to study the concept?



It's not because a college-savings-like plan for retirement needs to be constructed carefully, as leading behavioral economists say.



It's not because the financial industry is seriously concerned about improving access to retirement plans at work.



It's this: Its members don't want the rivalry.



"There is no reason for the State of Oregon to enter into competition with Oregon financial services companies who employ thousands of workers in the state and already provide these services, at no direct cost to the State," said Elise Brown, a lobbyist for the Securities Industry and Financial Markets Association, said in written testimony (Readers might remember SIFMA's foundation from the story about Canyonville Christian Academy's stock-picking success).



The legislation, House Bill 3436, calls for studying the formation of an Oregon Secure Retirement Plan -- a sort-of Oregon College Savings Plan for retirement savings. The task force would include members of the finance industry and recommend a plan by September 2014 for legislators to consider.



The House passed the bill Monday 33-25, voting strictly along party lines. As of late Friday, it awaited action in the Senate.



Last year, California created a similar statewide plan, the first of its kind in the nation. Efforts in other states have gone almost nowhere, in part thanks to opposition from Wall Street and insurers.



In Oregon, the thought of merely studying the idea drew the ire of some of the biggest names in insurance and finance. A dozen financial companies and business groups signed a May 14 letter "strongly opposed" to it.





Rep. Jules Bailey

"This is my third term," said

, D-Portland, who sponsored the bill, "but I've never seen so much Sturm und Drang over a task force before."

One of them,

., has since announced it's "neutral" on the bill.

"Many of our concerns have been addressed," Standard spokesman Bob Speltz said via email last week. Language struck from the original bill included a requirement that employers with no retirement plan give workers access to the state's plan through payroll deductions.

Still, Standard, part of

, "remains opposed to the State offering a plan through private-sector employers," Speltz said.

Yes, it's that neutral.

On the surface, some arguments against a statewide plan seem to make sense.

Rep. Mike McLane

"People aren't saving enough for retirement because they don't have enough income," said

, R-Powell Butte, who voted against the bill.

Also, why create another plan when Individual Retirement Accounts are available?

"There is an abundance of private-sector retirement savings options for both employers and individuals, and no case has been made that there is any void for the State to fill in that regard," Speltz said.

No case?

Only half of working-age, private-sector employees have access to workplace retirement benefits, the lowest share since 1979, a NIRS report found.

Right now, only 40 percent of full-time and part-time private-sector workers participate in workplace retirement plans,

. That's partly because only about 50 percent have access to one,

, research shows. Access is lowest among lower-income, African American and Latino households.

A just-released

found that 38 million U.S. households lacked not only a workplace plan but an IRA.

What about Social Security, you ask? Thank heavens for it, because one-third of retirees rely almost entirely on it. The average monthly benefit check: a whopping

.

Yet by 2033, that system will need to

unless we either contribute more toward the system or reduce benefits, actuaries say.

Traditional workplace pensions promised a defined benefit upon retirement. They're now a rarity,

, whose quality and costs vary dramatically from employer to employer.

If you don't have access to one, you're left investing in an IRA on your own or via a financial adviser or broker. And they're not likely knocking down your door.

The Certified Financial Planner Board of Standards Inc. has been on

to promote the value of its credential -- but mainly to households with $125,000 in average income, board President Kevin Keller recently told planners in Portland. The abundance of savings advice is increasingly aimed at those already with abundance.

What's more, a good chunk of financial advisers are brokers who aren't held to a

That means they don't have to recommend investments based on what's in the best interest of clients. Their own financial needs can trump the day.

So the households not saving are left in a wilderness without much of a compass but a cacophony of advertising.

This so-called abundance certainly has grown this country's financial sector. But it's failed to secure American retirement prospects.

Of course, a poorly designed state retirement plan won't solve this problem. But neither will the existing bevy of poorly designed plans.

Any statewide plan needs to be easily accessible,

It needs to auto-enroll workers. It needs to automatically invest them in target-date retirement funds that automatically adjust from risky to conservative over time. And it should gradually increase their savings rate. Otherwise, researchers say, people won't join and they won't save enough.

"Having a plan offered at the workplace is not sufficient," wrote two leading behavioral economists, Shlomo Benartzi and Richard Thaler,

. "Even for those with access to an employer-sponsored plan, almost a quarter fail to join, and among those who join, many save too little."

That's why a task force is as good a start as any to this retirement savings problem. President Obama's efforts to create automatic Individual Retirement Accounts appear bogged down by larger concerns. California's ambitious efforts have yet to get off the ground and

. Oregon can avoid both fates by pressing forward, much as it has with health reform.

The task force has a seat at the table for the Standard Insurances of the world to weigh in.

"I don't know what they're losing if more people come in" to the system, said Joyce DeMonnin, outreach director for AARP Oregon. "From our point of view, it's a win-win. Apparently they don't want to shake up the status quo."

-- Brent Hunsberger welcomes questions about

or

. Reach him at 503-221-8359 or

.