    [Public Papers of the Presidents of the United States: George W. Bush (2002, Book I)]
    [February 2, 2002]
    [Pages 168-170]
    [From the U.S. Government Publishing Office www.gpo.gov]

    The President's Radio Address
    February 2, 2002

        Good morning. In my State of the Union Address, I committed our
    Nation to three great goals: To win the war; to secure our homeland; and
    to defeat the recession.

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        In recent days, we have heard some encouraging reports on our
    progress and our work to defeat the recession. But many workers have
    lost their jobs and their retirement savings when their companies went
    bankrupt. Employees who have worked hard and saved all their lives
    should not have to risk losing everything if their company fails, so my
    administration is proposing important safeguards to our pension laws to
    protect the retirement savings of workers.
        First, we want to give workers greater freedom to diversify their
    retirement portfolios. Many companies require their workers to hold
    company shares long after their workers wish to sell, even when the
    company's shares are dramatically dropping in value. I propose that
    workers be permitted to sell company-contributed shares in their
    retirement account and diversify after they have participated in a
    401(k) for 3 years.
        Next, we need to make sure that companies have a single standard for
    their executives and their employees. It is unfair for workers to be
    denied the ability to sell stock when executives are free to sell their
    stock. Right now, though, companies can create what are called
    blackouts, when they switch the management of their retirement accounts
    from one investment firm to another. During the switch, employees don't
    have access to their 401(k)s and can't buy or sell. These blackouts
    usually happen because the company is looking for better service for its
    employees. But when employees can't sell, executives shouldn't be able
    to sell, either. So I am proposing that company executives be prohibited
    from selling any and all of their stock during these blackout periods.
        Third, workers should be informed in advance that a blackout period
    is coming. Under my administration's reforms, workers must be given 30
    days' notice before employers make any changes that would stop them from
    selling their stock.
        Fourth, companies will be put on notice: When employees are blacked
    out, company executives with power over 401(k)s will be held accountable
    for treating their workers' assets as carefully as they treat their own.
        Fifth, workers should have the benefit of solid, independent
    investment advice. Right now, the law deters companies from providing
    employees with sound advice such as information about the benefits of
    diversification, and that doesn't make sense. We need to encourage
    companies to provide workers good advice, not punish them for doing so.
        And finally, employers should be required to provide regular
    information to their workers about the current value of their accounts
    and their right to sell and diversify. Right now, employers need to give
    an accounting to workers only once a year. We're going to tell them they
    must do so every 3 months.
        These measures will be a major benefit for American workers and for
    America's employers. Our country's employers welcome the highest
    standards of conduct, because high standards are good for business and
    good for America.
        I thank you for listening.

    Note: The address was recorded at 2:40 p.m. on February 1 at Camp David,
    MD, for broadcast at 10:06 a.m. on February 2. The transcript was made
    available by the Office of the Press Secretary on February 1 but was
    embargoed for release until the broadcast. The Office of the Press
    Secretary also released a Spanish language transcript of this address.

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