I made some progress.
Here is an image of my revised nodes.
I appreciate your node post florianfelix, but it does not use an object inside blender, it relies on an external image. However, you are correct in the fact that the alpha is present, but not directly viewable in the blender render ouput window. I expected it to look just like the composite node preview. (So much for WYSIWYG software).
My goal here is to try to emulate an After Effects style masking system inside of blender. I thought if I could simply use flat objects and attach hooks to their verticies, I could animate the hooks and achieve an animated mask using the nodes. I could use the blur node to simulate the feather effect found in After Effects masking. I could use the scale node to simulate the mask contraction paramter as well.
The key to this approach is that you have to set the object index for the object that is going to become the mask and expose the object index in the render layers (in green). This way I could make use of the ID Mask node for generating my alpha.
My next problem is stacking.
I have added a RGB node into the layout, and I want my background color to be RED. But I can not figure out how to hook it into the layout to achieve this. I thought if I could have a background solid, I could visually detect my alpha working in the render window.
Does anyone know how to make the background of my node layout red?