Bonus Krauthammer hackery:
And look what Clinton unveiled this week: a modestly government-subsidized, personal retirement account. True, it is yet another big-government middle-class entitlement. Yes, she ignores the looming Social Security crisis. On the other hand, establishing a universal, portable, personal retirement account (though without the government subsidy) is something conservatives have long and devoutly sought. It establishes a parallel to the Social Security system — the perfect vehicle for a future conservative administration to use for shifting from the current, unsustainable government-controlled program to a privatized system such as the one in Chile.
For all the program’s success in economic terms, the government continues to direct billions of dollars to a safety net for those whose contributions were not large enough to ensure even a minimum pension approaching $140 a month. Many others – because they earned much of their income in the underground economy, are self-employed, or work only seasonally – remain outside the system altogether. Combined, those groups constitute roughly half the Chilean labor force. Only half of workers are captured by the system.
Even many middle-class workers who contributed regularly are finding that their private accounts – burdened with hidden fees that may have soaked up as much as a third of their original investment – are failing to deliver as much in benefits as they would have received if they had stayed in the old system.
Dagoberto Sáez, for example, is a 66-year-old laboratory technician here who plans, because of a recent heart attack, to retire in March. He earns just under $950 a month; his pension fund has told him that his nearly 24 years of contributions will finance a 20-year annuity paying only $315 a month.
“Colleagues and friends with the same pay grade who stayed in the old system, people who work right alongside me,” he said, “are retiring with pensions of almost $700 a month – good until they die. I have a salary that allows me to live with dignity, and all of a sudden I am going to be plunged into poverty, all because I made the mistake of believing the promises they made to us back in 1981.”
Now that, at least if you’re marginally more civilized than Krauthammer, is unsustainable.