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Bill: A guaranteed pension
Details
Submitted by[?]: Likaton Fascist Front
Status[?]: passed
Votes: This is an ordinary bill. It requires more yes votes than no votes. This bill will not pass any sooner than the deadline.
Voting deadline: June 2152
Description[?]:
| PSS has become concerned that the elderly may fall victim to private companies collapsing whilst they are drawing a pension from their contributions. As this is an area that the majority of our people will experience in their later years we feel it necessary for the state to institute a compulsory pension levy in order that the elderly are not unduly exposed to the possibilities of the market collapsing. PSS does feel that the individual should alllowed contribute to their own pension funds and suggests that a private system being allowed to exist alongside the public one. |
Proposals
Article 1
Proposal[?] to change The government's policy concerning the pension system.
Old value:: The state does not operate a pension system. Individuals must save up for retirement on their own.
Current: The state offers a voluntary public pension, combined with other voluntary private pensions.
Proposed: The state operates a compulsory public system combined with an optional private pension.
Debate
These messages have been posted to debate on this bill:
| Date | 19:51:58, November 29, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | The AAS may support this as a temporary measure, but we intend to (attempt to) nationalise the pension system soon. |
| Date | 20:34:22, November 29, 2005 CET | From | AM Radical Libertarian Party | To | Debating the A guaranteed pension |
| Message | The RLP opposes this measure, as we believe that the individual has the most to gain by maximizing his return, and will therefore be the best steward of his own money. Further, concentrating those funds under gogernment control presents an almost irrestible temptation to utilize these funds for other 'temporary' purposes. |
| Date | 21:03:40, November 29, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | Response to the RLP: Perhaps it is true that "concentrating those funds under government control presents an almost irrestible temptation to utilize these funds for other 'temporary' purposes"... but, that has to be preferable to the boom-bust cycle of private enterprise that continuously leaves people without ANY pension scheme, when these pension companies declare bankruptcy. Oh - and who has to step in, when this happens? The government does... but, without a STATE pension, all the money that SHOULD be paying for it, has been in the hands of the PRIVATE SECTOR. Effectively... each bankruptcy in pension insurance, is a pension policy being paid for TWICE. |
| Date | 07:01:02, November 30, 2005 CET | From | Representative Party | To | Debating the A guaranteed pension |
| Message | We oppose a compulsory pension system. |
| Date | 15:53:00, November 30, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | The AAS wonders why the Representative Party opposes a compulsary Pension Scheme? Surely, EVERYONE having some form of income after retirement, must be a GOOD thing? |
| Date | 17:06:40, November 30, 2005 CET | From | AM Radical Libertarian Party | To | Debating the A guaranteed pension |
| Message | By having reasonable fiducary responsibility laws and, if necessary, an insurance plan to compensate the clients of the few companies who declare bankruptcy, we can protect those who need the protection while allowing the freedom of choice necessary in a society of responsible adults. |
| Date | 21:55:45, November 30, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | Does the RLP not see what this entails? The RLP representative himself/herself says "an insurance plan to compensate the clients of the few companies who declare bankruptcy". Effectively, to protect some nebulous 'free market' ideal, we are going to charge customers ONCE for their pensions, and then ONCE MORE to insure the SAME service. |
| Date | 22:03:51, November 30, 2005 CET | From | AM Radical Libertarian Party | To | Debating the A guaranteed pension |
| Message | And how does the AAS intend to protect the consumers from the same bad investment decisions made by government employeed fund managers? The fact that the government employees them does not make them infalible either; they will make misjudgements and lose money; and someone will suffer these losses. If it is a competing group of private enterprises, the consumer can study the different fund choices and make an informed choice. |
| Date | 22:40:37, November 30, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | The AAS envisions the savings would be made by sheer economic pressure: 1) Since the government is the body handling the pension (indirectly), AND insuring the pension, the payment need only be made once. As opposed to the current system, where a client pays a broker, and then pays part of his/her TAX to cover the governmentally sponsored default insurance. 2) The government has a degree of pressure to bear, to ensure that external costs are kept low. 3) One government agency, handling ALL pensions, minimises overheads, and other flat costs per item. One large agency also has better access to economies of scale, than do a number of smaller institutions. 4) It is a fallacy to assume that JUST because the government would handle all pensioning, there would only necessarily be ONE 'fund' choice. A government agency has reason to keep a varied portfolio, just as individual agencies do. 5) The government can appoint experts to handle fund choices. Although the consumer should have SOME say, perhaps, over their pension requirements... expert advisors are capable of making more-informed decisions. It is a fallacy to assume that customer preference is the MOST important pension factor. |
| Date | 19:58:49, December 01, 2005 CET | From | AM Radical Libertarian Party | To | Debating the A guaranteed pension |
| Message | 1) The provisions for losses still needs to be made, I see little difference to the consumer between making one larger payment to the government portifolio or making one smaller payment to a private portfolio and one smaller payment to an insurance fund. 2) Government has a history of not keeping external costs low; the $257 hammer sticks in the voter's minds still, as do many orther examples of government 'efficiency'. 3) This we have to agree on, but point out that monopolies do not always take advantage of these economies due to lack of competition. If the consumer has to shop here, why be competitive? 4) I agree, and if I gave the impression that I thought there would only be a single choice, I apologize for not being clear. 5) Here is the point where we are in basic disagreement. Expert advisors thought the market would never crash in 1929. The consumer can make his own informed choices, or seek out his own expert opinions. We believe that 'customer preference is the MOST important pension factor'; after all, he's the one who earned the money. |
| Date | 03:48:30, December 03, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | 1) The problem is, that private industry can go bankrupt, but a government industry can NOT... unless there is a critical government budget failure...in which case, the whole shooting-match has gone to hell in a handbasket anyway, so NO pension would be secure. There IS no need for a large payment or two payments to a government pension, since the minimal customer payment to the government IS the same amount that insures the amount... and, any shortfall can be gleaned from taxes already paid. In the case of PRIVATE pensions, if the company fails, the government HAS TO back the WHOLE amount, anyway... but without the benefit of RECEIVING the premiums BEFORE the catastrophic events. 2) Government can be held accountable, and SHOULD be held accountable. The AAS is an example of this... we believe it came up in discussion before, ALL AAS members gain the same 'wage' from their jobs, regardless of 'rank', and are paid a fair, susistence amount. This is monitored internally, by an appointed agency, and has been remarkably effective. Also - the AAS actively SEEKS the assistance of outside groups, to maintain our honesty, ESPECIALLY since we have held the Head of Government seat... the LAST thing we would wish for, would be corruption in the halls of the Senate. 3) Again - transparency and efficiency CAN be safeguarded, through the internal and (especially) external application of 'watchdogs'. If the law requires accountability, and 'corruption in government' watchdogs are given ABSOLUTE access (as the AAS believes they SHOULD be, anyway)... government is compelled to be 'honest'. Perhaps the RLP would like to take up 'tenure' in the Finance Office? A Finance Department Directorship from RLP ranks, would be an excellent way for the RLP to monitor the 'accountability' of government budgets...? 5) In defence... all the PRIVATE investors denied the possibility of a 1929 crash, also. What we are talking about there, is pretty much a 'catastrophic financial event'... and NO AMOUNT of 'advice' could have avoided the repurcussions of THAT snowball. HOWEVER, strict GUIDED investment immediately after the event, COULD have ameliorated the effects for MOST people. |
| Date | 20:35:06, December 04, 2005 CET | From | Front for State Prosperity | To | Debating the A guaranteed pension |
| Message | Compulsory pension systems encourage a "spend now" mentality that will exacerbate rather than ameliorate poverty. These people who are taxed for pensions will say, "The money will be there when I get older." They will neglect to save because of it. This will thus force them into poverty once they retire (I doubt these pensions will really pay enough to ensure a great standard of living) and leave them humiliatingly dependent on government largess. |
| Date | 20:59:50, December 04, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | How curious... unless the AAS representative is VERY much mistaken... the PCP are arguing AGAINST a capitalist mechanism? Surely, according to strict 'capitalist' policy, money saved, is money dead? Surely, we WANT people to be putting their money INTO the economy? Also - how is the mandatory government pension, any different from the optional private pension... in THIS respect? Both allow for a certain amount to be withdrawn periodically as premia, and both ultimately promise the same manner of bonus... and both, thus, leave the customer with a defined 'amount' being 'saved' (by whichever means), and disposable income to use. |
| Date | 10:35:53, December 05, 2005 CET | From | People's Party | To | Debating the A guaranteed pension |
| Message | If you want absolute security of income in retirement, invest in an annuity. If they don't give you what they promised - you can sue the life out of them. Typically companies that sell annuities are backed up by insurers to prevent this sort of thing from happening. They use complex investing formulas to always stay ahead of your needs in retirement. So the chance that they go bankrupt is almost nil, unless of course stock -markets all around the world crash, along with the bond markets and gold, and commodities all simultaneously just a few years before you're about to retire. Based on the last 100 years of investing history, I would say thats very unlikely.. Govt would give a real return of only 1-2% post inflation whereas investing by yourself in the stockmarket would give you about 6%. That means the return from a private fund is easily 2-3 times higher than govt pensions. This means an average person making $30,000 a year could with some discipline, retire as millionaires on a private plan , whereas doing the same on the govt plan would get you less than Half of that. I'm sure at this point you're not paying attention, but clearly this last bit is the most important difference i.e. that our existing pensions scheme allows ordinary people to access tremendous wealth. So your proposal would only hurt millions of ordinary Likatonians by making them poorer, and giving them fewer opportunities in life. Is that a really a progressive ideal? |
| Date | 14:39:46, December 05, 2005 CET | From | AM Radical Libertarian Party | To | Debating the A guaranteed pension |
| Message | To the AAS: 'Surely, according to strict 'capitalist' policy, money saved, is money dead?' - not at all, money saved is money invested in tghe economy to enable it to grow (unless your savings consists of digging a hole in the ground and putting your money in). The difference between a mandatory and voluntary pension system is in the attitude it engenders in the participants. If one choses to invest, it seems more like your own money than if the government takes it and hides it away. As to your suggestion, we would be honored to serve in any capacity, and the Ministry of finance would be an area we would be pleased to add our expertise in the next cabinet. |
| Date | 23:07:11, December 05, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | Response to the RLP: The AAS looks to formation of cabinets at least a half a term in advance. We realise we can't guarantee any kind of electoral success (especially since we pipped the PCP by a mere one seat this time), but we have been carrying out a programme of at least TRYING to capitalise on all that is best in Likatonian government, year on year. At the moment, we have excellent representation in the Foreign Office (Thanks to the Progressive Party), and excellent representation in the Defence seat, thanks to the PSS... both of which are (currently) positions that AAS sees as being 'tenured', as earned by performance. If the AAS manages to field the Head of the next Government, we will definitely be offering the Finance Office to the RLP. |
| Date | 23:22:37, December 05, 2005 CET | From | Commonwealth Workers Army | To | Debating the A guaranteed pension |
| Message | Response to the People's Party. The solution in the form of annuities, is still flawed. There IS no way to guarantee year on year profit, no matter WHAT the investment portfolio. The best you can do is hope for profits, and hope to avoid losses... like by investing in mutual funds, where your losses will hopefully be absorbed in the overall margin. And... if your annuity provider fails to deliver what you bought-into... it's likely that sueing them wouldn't help... after all, if they are broke, they are unlikely to be paying out that way, or any other. So - there ARE no guarantees in 'private' pensions... you can't guarantee 6%, because you can't guarantee ANY sum. The advantage that a Government pension has, is that EVERYONE gets a pension, unless your Government suffers a critical failure. The disadvantage of private pension schemes is that EVEVRY investor is relying (even hoping) on the caprices of the stock exchange. |
| Date | 09:26:24, December 06, 2005 CET | From | People's Party | To | Debating the A guaranteed pension |
| Message | The problem with your argument is - your ignore hiostorical returns. Historically equity markets have returned 9 % a year over the last 50 years. When you take out inflation, it becomess 6% a year. Of course this doesn't mean that every year you'll get 9%- its just talking abt average. Another thing to keep in mind is that equity will ALWAYS outperform debt and other asset classes in the long terms since the risk is greater. Its all about Risk and Reward -an elemental financial concept. So if you stick around in equity you're guarenteed to make more over the long-term. Secondly your analysis of annuities is dead wrong. You missed the part about them being backed up by insurance companies. These companies also have the money they need to pay for sudden requirements hedged i.e. no matter what happens in the market that money will not lose value. So unless every single market crashes, including commodities, gold, government and corporate bonds, stocks and homes both here and abroad, all simultaneosly. This is almost impossible, and if treasury bonds crashed then your 'secure' government scheme would also collapse. Remember, the worst economic disaster America ever had , the Great Depression, could not stop the American economy from returning 9% a year.. Plus |
| Date | 09:40:01, December 06, 2005 CET | From | People's Party | To | Debating the A guaranteed pension |
| Message | I should have said returns for the last 100 years have been 9% or more nominally. |
| Date | 10:16:47, December 06, 2005 CET | From | Likaton Fascist Front | To | Debating the A guaranteed pension |
| Message | OOC: That is one of the most satisfying debates I have seen to date, Kudos to all who participated and I never realised that the subject would be a such lively debate material. Oh and.. er.. moving to vote. |
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Voting
| Vote | Seats | |||
| yes | Total Seats: 218 | |||
| no | Total Seats: 156 | |||
| abstain | Total Seats: 126 |
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