Labor Dept. to Implement 401(k) Protection, Bush Says

President Bush said Saturday his administration was acting to protect investments of the 40 million Americans who have put $1.5 trillion into 401(k) retirement savings accounts.

“Turbulence in the markets reminds us that every investment carries some risk,” Bush said in his weekly radio address. “Yet American workers also have rights that must be respected and enforced.”

The $1.5 trillion in the hugely popular 401(k) accounts “is real money for real workers, and we must do all we can to help make sure it’s there for them when they retire.”

Bush announced that the Labor Department will begin implementing retirement plan protections Monday that Congress approved this year as part of a bill to overhaul corporate accounting practices. Under terms of the new regulations, 401(k) participants will be given 30 days’ notice before being locked out of buying or selling in their accounts when administrative changes are ordered.

“This important protection will help ensure that workers don’t get stuck in a bad investment simply because their employers block them from accessing their own accounts,” Bush said.

Another regulation, which bars corporate executives from selling their stock during such blackout periods, is being enacted through a regulation from the Securities and Exchange Commission.

“If you can’t sell on the shop floor, you should not be able to sell on the top floor,” Bush said, adding that both rules will be in effect by early next year.

Even though the rules already were required by Congress, White House aides sought ahead of time to portray the president’s radio address as evidence of presidential news-making on the economy.

The White House has its eye on the Nov. 5 elections that will determine control of the House and Senate and many state legislatures and governorships. Bush hopes to deflect Democrats’ claims that the economy has worsened during his presidency, and that he has done little to help.

Bush also urged Congress, especially the Democrat-controlled Senate, to pass additional retirement savings protections beyond those included in the accounting changes law. These would include ensuring that workers can sell any company stock they own after three years, “so that no one’s nest egg is tied up in the stock of a single company.”

His proposal also includes giving workers access to professional investment advice and making sure they receive quarterly reports on the performance of their 401(k)s.

The Republican-led House passed a pension overhaul in April that included those and other provisions. Senate Democrats, however, have yet to agree on such issues as whether to limit how much company stock workers can have in 401(k) plans and whether to require that employees serve on company boards that oversee retirement plans.

Bush said lawmakers should resolve their differences. “People who work hard and save for the future deserve every protection we can give them,” he said.

Bush was spending the weekend at the presidential retreat in Camp David, Md.