Tuesday, January 4, 2011

Will Private U.S. Pension Funds Be Grabbed by the Government?

The short answer is that governments are already starting to seize private pensions funds in Europe.

Jan Iwanik writes at the Christian Science Monitor:
[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. $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...

[In Poland] the government wants to transfer of 1/3 of future contributions from individual retirement accounts to the state-run social security system. Since this system does not back its liabilities with stocks or even bonds, the money taken away from the savers will go directly to the state treasury and savers will lose about $2.3bn a year.
You can be sure that U.S. bureaucrats are watching closely how the people react in these countries to the plans.

Given the bankrupt state of the U.S. Social Security system, you know various schemes are being tossed around. Will there be required investments in U.S. Treasury securities in order for tax payers to receive tax breaks? Will there be an outright grab? Who knows?

But, if some European countries successfully pull off thees pension grabs, it will certainly give U.S. government financial officials very big eyes.


  1. the 11th july 1992 the italian government grabbed the 0.6% of all money deposited in current accounts.
    governments can and will do anything in order to grab money. pension funds will be looted.

  2. And how is the Argentina Pension Grab Attempt Going ?
    MSM is absent on reporting these issues.