Governments across the world are stooping to new lows in an effort to keep financing their spending addiction by grabbing retirement savings, gift cards, and anything else they can get their hands on. If anyone attempted these acts outside of the government they would be locked away in prison for a very long time, but most governments, including our own, believe that they know how to spend our money better than we do.
In Hungary last month, the government made the citizens an offer they could not refuse. They could either remit their individual retirement savings to the state, or lose the right to the basic state pension (but still have an obligation to pay contributions for it). In this extortionate way, the government wants to gain control over $14bn of individual retirement savings.
The Bulgarian government has come up with a similar idea to the one implemented in Hungary. $300m of private early retirement savings was supposed to be transferred to the state pension scheme. The government gave way after trade unions protested and finally only about 20% of the original plans were implemented.
It could only happen in Europe, right? Think again.
In the state of New Jersey, lawmakers voted last year to allow the seizure of gift cards and travelers checks after two to three years as a way to raise about $80 million and help balance the state’s budget. Although a federal judge temporarily struck down the law, the state is currently appealing.
Let’s think about this. If you are holding gift cards or travelers checks that are over two years old, the state of New Jersey will steal it from you. If someone came into your house and stole your money like this, you would call the police and feel victimized. Why does the state feel they can legally steal these private funds from people?
Let’s look at Ireland. In 2001, the National Pension Reserve Fund was brought into existence for the purpose of supporting pensions of the Irish people in the years 2025-2050. The scheme was also supposed to provide for the pensions of some public sector employees (mainly university staff). However, in March 2009, the Irish government earmarked €4bn from this fund for rescuing banks. In November 2010, the remaining savings of €2.5bn was seized to support the bailout of the rest of the country. I wonder what will become of these public sector employees that try to retire and find that their government has squandered their pensions?
For many decades, the U.S. government has indulged in the habit of taking money out of Social Security funds to bolster its other programs. This off-budget spending of Social Security funds is possibly the biggest threat to elderly Americans’ retirement plans.
Social Security is now just a joke. Each year I receive letters stating that although I have paid into the system as required, Social Security will be broke by the time I wish to retire and that I can only expect partial benefit payments. In fact, I don’t expect ANY benefit payments.
Although governments are able to force participation in these new taxes and retirement schemes, they do not seem to be the best guardians of the money accumulated there. It is time that the people stop the theft being perpetrated by governments across the world. Only fiscal conservatism can bring sanity back to a states budget – not theft.