The Babe Theory Of Political Movements.
Mar. 21, 2005 11:50 AM
Iran's Sham Election In Houston.
June 20, 2005 5:36 AM
Yes, Kanye, Bush Does Care.
Oct. 31, 2005 12:41 AM
Health Care vs. Wealth Care.
Nov. 23, 2005 3:28 PM
Americans Voting With Their Feet.
Nov. 30, 2005 1:33 PM
Idea Majorities Matter.
May 12, 2006 6:15 PM
Twilight Zone Economics.
Oct. 17, 2006 12:30 AM
The "Shrinking" Middle Class.
Dec. 13, 2006 1:01 PM
From Ashes, GOP Opportunities.
Dec. 18, 2006 6:37 PM
Battle Between Entitlements & Pork.
Dec. 21, 2006 12:31 PM
Let Economic Freedom Reign.
Dec. 22, 2006 10:22 PM
Biggest Health Care Moment In Decades.
July 25, 2007 4:32 PM
Unions Antithetical to Liberty.
May 28, 2008 11:12 PM
Right To Work States Rock.
June 9, 2008 12:25 PM
Social Security Reform Thursday.
March 13, 2008
Caption Contest: Enter Today!
Due: July 29, 2008
The Carnival Of Classiness.
Mar. 14, 2006
Quotational Therapy: Obama.
Apr. 4, 2008
Mainstream Melee: Wolfowitz.
May 19, 2007
Pundit Roundtable: Leaks.
July 9, 2006
A WILLisms.com(ic), by Ken McCracken
July 14, 2006
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Social Security Reform Thursday: Week Twenty.
Thursdays are good days for reform, because they fall between Wednesdays and Fridays.
That's why WILLisms.com offers a chart or graph, every Thursday, pertinent to Social Security reform. The graphics are mostly self-explanatory, but we include commentary on some of them where and when necessary.
This week's topic:
Personal Accounts Around The Globe.
"From the Conservative party in Great Britain, to communists in China to a fascist dictatorship in Chile to social democrats in Sweden, the impetus of reform has been the same. Ideology doesn’t matter when you can’t pay your bills."
So sayeth National Center for Policy Analysis (NCPA) President John C. Goodman.
Indeed, the Bismarckian pay-as-you-go funding structures of pensions found around the world are collapsing for the same basic reason: people, in every corner of the world, stopped making enough babies to support the pyramid scheme necessary to keep pay-as-you-go afloat.
So, facing looming crises, what did governments of various stripes, all around the world, do? Did they say There Is No Crisis? Did they simply say No Dice? Did they hope to pass the problem on to future generations?
Governments all around the world saw the writing on the wall, got their rear ends in gear, and reformed their Social Security systems for the long-term.
A June 2005 policy study by NCPA, Reforming Social Security: Lessons from Thirty Countries (via Social Security Choice blog) examines pension reforms from a diverse lot of nations, noting that the "way we design the personal account system will determine reform’s winners and losers, the economic status of the elderly as a group as well as the cost to the coming generations, and its impact on the broader economy."
Success of the reforms range from adequate to wildly successful, and we can draw lessons about how to keep administrative costs low, how to minimize investment risk, how to structure benefit payouts (preventing retirees from blowing a hole in their money in one fell swoop), and, most importantly, how to ensure that the elderly are kept out of poverty.
Let's take a gander at the pension reforms around the world. In some countries, the personal account comprises the bulk (or all) of the pension, in others it is only a portion of an overall pension strategy:
With younger populations and relatively small pension obligations (and because of early action), Latin American countries generally opted for larger personal accounts, decisions which have paid off remarkably well over the years.
With a couple of notable exceptions, personal accounts in these countries comprise a relatively small portion of their pension systems. Here's why:
Countries of Eastern and Central Europe typically have large implicit pension debts due to aging populations and generous benefits owed to workers and retirees in the traditional systems. These countries were more likely to start relatively small private plans, because they could not afford the high transition costs they would face with a larger shift of contributions. Nor could they afford an add-on in view of their already high payroll tax rates, which often exceeded 25 percent.
An interesting fact, underscoring the power of personal accounts:
...in Sweden, which has the smallest private pillar in relative terms, about 14 percent of total contributions go into the accounts; but 30 percent of total benefits are projected to come from the accounts.
Compared with other industrialized countries, the United States currently has a trust fund surplus and a relatively small pension debt stemming from our younger population — which makes it easier to divert some of the current payroll tax into personal accounts.
If Democrats continue to obstruct real reform over the next several years, however, our options for an optimal remodeling of Social Security diminish rapidly, policy-wise, as well as politically.
-Week One (Costs Exceed Revenues).
Tune into WILLisms.com each Thursday for more important graphical data supporting Social Security reform. We'll address more myths in future installments.
Posted by Will Franklin · 16 June 2005 01:13 PM
HELLO! It is Reform Thursday once again! I actually think there has been progress on Social Security Reform as far as the idea! More and more people are talking about the need for REFORM! HELLO, it is about time!
Posted by: Cindy T. at June 16, 2005 04:39 PM
Yea!... Reform Thursday at WILLisms.com !!!... I sure wish our politicians would get on the ball and reform! It is so important for everyone! Social Security needs reform!
Posted by: Zsa Zsa at June 16, 2005 05:05 PM
If no one has mentioned it recently Will, thanks.
The battle is far from over but I agree with you, Cindy. People are definitely more aware. No massive surveys needed for me to know that either.
Take this family simply as an example, and then imagine how many others have been fielding questions from their offspring about Social Security as it relates to them.
Sad how few times you hear about that population when it comes to overhauling the current Social Security System, because they do get it.
Posted by: Doyle at June 16, 2005 06:14 PM
I saw your comment on There is no crisis... They are right about one thing for sure! That is that James Carville belongs on The Wall Of Shame!... That is the most garbage I have seen on a screen in a while! HELLO! You idiots! it is time to wake up and open the filing cabinet!...That was as nice as I could put it. They are idiots!
Posted by: Cindy T. at June 17, 2005 10:54 AM
Nancy Pelosi and her gang did say no dice! They are so anti-GOP that they just can't admit, or refuse to think we have anything in common! Afterall we are Americans! Instead the partisan filibustering continues on every detail of every issue! Just for the sake of disagreeing! ...
Posted by: Zsa Zsa at June 17, 2005 11:14 AM