mostly in the UK, but it will happen in america and everywhere else
http://www.telegraph.co.uk/comment/4077140/A-century-after-its-birth-is-the-state-pension-on-its-last-legs.html
The old-age pension is 100 years old this week - and like any centenarian, it is almost on its last legs. The cost of sustaining an adequate state pension for a generation that is living for 20 or even 30 years after retirement has become prohibitive.
The reasons are simple. There are currently more than 11 million people of pensionable age. By 2020, that total is predicted to reach 14 million, the inevitable result of a world in which privation is rare and good health is sustained well into old age. This demographic timebomb has been ticking from the moment the first old-age pension was paid out; yet governments down the years have been complicit in the pretence that the state would provide for old age, when they knew that it never could. Such is the shortfall that the official state pension of about £4,300 a year would need to be tripled to reach the poverty line.
So how can we pay for our pensions? This week, it was reported that a Green Paper due later this month will propose that those in work should pay a compulsory insurance levy to subsidise their care after they retire. The idea that the state can provide for old age is no longer feasible, if it ever was – especially given the extra burden of paying for the personal pensions of public-sector workers, estimated at £650 billion by the Government and up to £1 trillion by the CBI and others. So dire is the situation that some are muttering that we might now be better off had we never relied on the state pension, and the false promise it held, in the first place.
It seems hard to imagine a world without some sort of government provision for old age – indeed, we now consider it the hallmark of a civilised society. But to the Victorians and Edwardians, the idea of a payment by the state for retirement was considered bizarre, the very antithesis of personal responsibility. People were expected to save in order to avoid becoming reliant on charity or Poor Law relief. In 1893, the social reformer and slum renovator Octavia Hill testified against state provision before a Royal Commission that included the Prince of Wales among its members. "I should describe it as the most gigantic scheme of inadequate relief ever devised by any human being," she said. "It seems to me it would not be adequate. I cannot believe it would promote thrift… [and] it would do a great deal to destroy one thing that is most desirous to cultivate, the sense of responsibility of relatives."
As Hill's comments suggest, few, if any, social policies have been more argued over, more controversial or more problematic than the idea of a state pension. When the idea was revived, after the Liberal election victory in 1906, it was because David Lloyd George and Winston Churchill, then in the Liberal government, believed social reform would bolster the party's position against the threat from the newly established Labour Party, which was vying to become the representative of the working classes. The consequences would be far-reaching: to start with, it had to be paid for (£16 million a year at first). And so Lloyd George, as Chancellor, introduced his People's Budget in 1909 to increase income and estate taxes on the better off to fund his social programme.
This led to a monumental clash with the House of Lords, which rejected the budget; a general election, which the Liberals won; and the introduction of the Parliament Act to assert the primacy of the Commons over the Upper House. From the very start, then, the pension had the capacity to cause political ructions on a grand scale.
But what, precisely, was all the fuss about? When it came into force, in January 1909, Lloyd George's measure offered an initial payment of five shillings a week (7s 6d for a married couple) to all retired workers over 70. It was known colloquially as the "Lord George", because only a lord could be so generous – yet in fact, the level of benefit had been deliberately set low, to encourage people to make their own additional provision for retirement.
In order to be eligible, workers had to be earning less than £31.50 per year and to be of "good character" – a condition dropped within a few years. Also excluded were those in receipt of poor relief; "lunatics" in asylums; persons sentenced to prison, for a decade after their release; persons convicted of drunkenness (at the discretion of the court); and any person who was guilty of "habitual failure to work".
A century later, and the notion that the state will provide in our old age – even for drunkards and layabouts – is so ingrained in the national psyche that any alternative seems impossible to contemplate. But the fact that millions of us have our own provision funded by private and employer contributions indicates that the basic pension is not enough. And how could it be? When the first was paid out 100 years ago, relatively few people lived beyond 70, and then for just a few years. The financial burden was manageable; but over the years, successive governments have sought popularity by promising to provide a pension that was sufficient for retirement, yet which never could be.
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I just post the stories, for interest.. for everyone
Lord, what fools these mortals be!
- A Midsummer Night’s Dream, Act III, Scene ii
Voltaire said: "Those who can make you believe absurdities can make you commit atrocities."
H.L.Mencken wrote:"The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary.â€
Only two things are infinite, the universe and human stupidity, and I'm not sure about the former. Albert Einstein