Is welfare a Ponzi scheme? Ctd

via Andrew Sullivan

Look at this graph which shows lifetime contributions compared with benefits. There is a full report that backs up the graph (pdf), explaining why welfare and superannuation is broke and will continue to be broke.

I’d love to have a similar comparison done here. I suspect the graphs would be worse.

As the discussion of needed reforms proceeds, a common demand will be that future retirees get back what they have paid into the systems. But reducing these complex discussions to a debate over “money’s worth” ignores the grim reality of the programs’ finances today, as well as the fact that these programs have always transferred money between individuals – both within, and more importantly, across generations. Our work has shown that current and near-term retirees can expect to receive benefits well above their contributions, financed by current and future workers who have little hope of realizing the same level of return on their taxes due to the economic and demographic forces that are working against them.

 


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  • reid

    I’ve often said I would like to know what my personal ratio of lifetime-to-date contribution over withdrawal is and if I’m in surplus then I accordingly get to go to the head of the queue if and when I require govt services such as at A&E or surgery for example.

    I mean, why not. Many people all their lives are in surplus while many others all their lives are in debit. Why the hell should those in debit have the same priority as those in credit? That’s not just and equitable, at all.

    • thor42

      Agreed. Very sensible, and I too would **love** to know what mine is.

    • notavictim

      Agreed good point reid. Classic example– dropkicks going to the a+e so they dont have to pay their GP. Plenty of them would have no hope of ever being in credit. Maybe we should means test super entitlements against ones level of credit/debt from public services, that would provide at least some encouragement to refrain from being a burden for a lifetime then sucking the public teat for another 20 yrs of retirement. Actually come to think of it retirement from what? 65 prolly just means a change in benefit description lol.

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