Thursday, January 01, 2009

Paying for old age

As it is a new year, I would like to start off with a light-hearted and amusing story. Unfortunately, I can't find one worth bothering with so, via Timmy, let's kick off with a coronary-inducing article instead.
Every adult could be forced to take out private insurance to cover the cost of their care in old age under plans being considered by the Government.

Taxpayers would have to pay hundreds of pounds in premiums every year while working, and would receive payouts if they later have to move into a nursing home.

The radical plan is being considered by ministers as a way to tackle the system of long-term support for the elderly in England, which is widely considered to be unfair, underfunded and too complex.

You fucking what? Look, you cunts, we already have a compulsory insurance system; it's called, entirely intuitively, the National Insurance system. We workers pay 11% of our salary into it, and our employers pay another 12.8% on top; over the next year, this is projected to raise £104.56 billion pounds [PDF]. Plus, of course, that felcher Brown, and his badger-faced sockpuppet, are planning to raise both sets of contributions by 0.5% in 2010.

So, where the fuck is my payout?

Oh, there isn't one, is there? Great. And now you cunts want me to pay privately, on top of that which you steal from me under threat of force? Fuck you, you shits: fuck you right in the ear.

I have been saying for some time that National Insurance is a massive fucking Ponzi scheme: people are told that their contributions is going to be invested over a long time, and the payouts used to pay for various benefits.

Lies. Stinking fucking Lies. The whole thing is a fraud.

Now, John B has previously pointed out that no one really believed that is how it worked.
I don't understand why taxing today's workers to pay today's retirees is viewed as a Ponzi scheme.

If we're going to get hardcore libertarian, then sure, I shouldn't be taxed to pay Sid and Doris Pensioner their gbp144 a week.

But if we think pensioners deserve rewarding for the time they spent working (and paying tax), then taxing me and DK to pay them doesn't seem like an obviously insane use of money.

The trouble being, of course, that now the government are feeling... well... a bit like Bernie Madoff did a few weeks ago, I imagine. They have taken all of this money and simply used the income to pay out early investors—and now they don't have enough money to pay out to the newer investors.


Isn't anyone else tired of the government lying to them about NICs? Isn't anyone else tired of seeing what is ostensibly their old age insurance being spunked up the fucking wall on fucking NI databases and subsidised bars for MPs? Because I am fucking raging...

Fine: I shall take out insurance for my old age: but I want the government to stop fucking taking my money every month and to return what I have already paid in. I will then happily sort out my own insurance over and above what I already do, of course.

For I already have a private pension (which I need, admittedly, to up the payments on), private medical insurance and private unemployment benefit. And I have signed contracts for them, so I know what my obligations are, what the insurance companies' obligations are, and what I can expect to get.

I have signed no such contract with the government. So, the state forces workers to make contributions—under threat of violence—and then simply decides to change the terms of the contract whenever they decide that they cannot be bothered to honour it; or when, having pissed all of our money away, the state decides that it cannot afford to pay for those things that it said it would. And, of course, with there being no actual contract, one has no recourse to the law.

It's a fucking shocking state of affairs. Over the years, this government in particular (but previous ones almost equally so) has wasted billions of pounds of our money—and now they are not even going to live up to the most basic of promises that they made.

They are an incredible bunch of fucking wankers.

UPDATE: the Whited Sepulchre is among a number of people who think that the US system is the same. [Emphasis mine.]
Here's Tim Slagle, writing in the December issue of Liberty magazine:
Here’s the reason why a private insurance program will always be a better option than Social Security: there was a slump in the market this week, but it will recover. Almost all the value it had will come back in time. On the other hand, everything you have ever paid into Social Security has been spent. It’s gone. Social Security is completely bankrupt, and trillions of dollars in debt. If it were a private corporation, its administrators would all be in jail.

So if you had your choice, whether to put 15% of your income into Social Security, or the stock market, where would you put it? And in a free country, shouldn’t you be entitled to make that choice?

First off, the total bankruptcy of Social Security has been brought to you by the same people who think they can regulate the stock market. But, I digress.

Let's take Mr. Slagle's statement a few steps further... Given the total lack of accountability in the Social Security system, I think that all of us—Democrats, Republicans, Libertarians, members of the Green Party, and the Flat Earth Society—all of us would've prefered to put all of our money into the stock market from Day One, and do without Social Security altogether, right? There is no money at all in the S.S. fund. It's now a troubled Ponzi scheme. Surely we can agree on that much.

But what if you were only given the choice of withdrawing all of your contributions to Social Security and putting it into the market on the day before the recent financial meltdown? Would you still do it?

Of course you would. Unless we immediately open the border to a jillion Mexican teen-agers, there simply aren't enough people coming into the workforce to keep the current Bernie Madoff-style Social Security scheme afloat. It's doomed.



Anonymous said...

Trouble is, an awful lot of the electorate still believe that NI is carefully invested in individual accounts to pay for both pensions and the NHS.

Mark Wadsworth said...

"For I already have a private pension (which I need, admittedly, to up the payments on)"

Private pensions are an even bigger scam that the NI system, and given their seriously lousy performance over the last ten years (they just invest in shares), you're better off investing your money yourself.

However, I agree that many people don't realise it's a Pay-As-You-Go system, which somehow miraculously pays for teh NHS (£100 bn) and the entire welfare state and pensions (£150 bn or so).

Jon said...

Couldn't agree more, Mr Devil. When I were a lad, my income was so low that I didn't pay NIC. The taxman suggested I make "voluntary contributions". I declined. Even then I knew that NI was a fraud, and that by the time I needed it, my money would simply not be there.

BTW your style in this post is virtually indistinguishable from Obnoxio's! You really MUST be angry!

Anonymous said...

Side issue I know, but I really, really hate the word "tackle". It is used by poly tic als to denote vigorous action when it actually signifies nothing but hot air. Whenever I see it I know a hoax is being perpetrated.

DavidNcl said...

Employer's NI is no such thing. It's just an accounting fiction. It comes out of the money an employer sets aside to pay you.

With access to ~22% more cash I could have sorted out a quite nice little private pension myself.

Of course none of us actually think that the new "private" insurance that we'll be made to have will actually be private in any sense of the word. Nor will it be insurance or an investment. Just another extension of the Ponzi scheme.

Nor will we be able to rely on savings or other investments - inflation plus government dicking about with interests rates will take care of that one.

The comparison with private Ponzi schemes has always seemed unfair - unlike NI nobody makes you invest in a such a fraud.

For a glimpse into what the outcome might look like try this: The Rise and Fall of Albania’s Pyramid Schemes.

Shaun said...

I thought that every thinking person knew that NI/Health was a Ponzi scheme - its obvious from the fact that there's no fund, only revenue so today's taxpayers pay today's benefits in the expectation that it will be the same tomorrow.

That 1) we are forced to participate on pain of imprisonment and 2) are liable to being convinced that its a nebulous and different thing are entirely irrelevant.

JD said...

The word 'forced' says it all.

Anonymous said...

I can't help wondering what dirty trick they will pull next. I wouldn't be too surprised if the retirement pensions we have all contributed to for years, will become means tested. Most of us would get nothing.

The private insurance idea is not in our best interests at all. Either their performance will be dire, or if it's good, broon will hit them with a massive tax raid just like he did with the private pension schemes.


Anonymous said...

Fuck 'em in the ear. Fuck 'em in the other ear.

timbone said...

Yea. It's a bit like the government superanuation scheme. Who shall we use, ok, the teacher. He/she pays 6% of their salary for a final salary index linked pension. The theory is that all these 6%s pay the pensions of the the retired folk, then when you retire, you get it back. Well you do, the only thing is, it is a bloody burden on the treasury because those 6%s never get to the teachers' pension fund, they have to run the gauntlet of national debt on the way.

Of course, the government are very concerned about our health, and spend lots of our money telling us how to live longer, don't smoke, don't drink, eat healthy food and join a gym. Now we would all like to die of good health, but that is very rare, as we get old, we develop an illness called getting old, which costs money.
So, to sum up, I give up smoking, drinking, eating unhealthy food and join a gym, and pay more NI because I am going to live longer so need more pension and instead of getting ill 3, 6, 9, 12 years earlier, I get ill and have to be paid to die anyway on top of all the extra pension I recieved.


Shug Niggurath said...

They get more than 10% of your income for this. Demand you pay for your own care out of your remainder and are now actively encouraging two policies which will be made law.

1. Compulsory organ donation.
2. Euthanasia.


Anonymous said...

" Over the years, this government in particular (but previous ones almost equally so) has wasted billions of pounds of our money"

This is crap. This administration has presided over the biggest ever peacetime increase in public spending. The scale of both the spending and the waste is quite unprecedented.

Dr Evil said...

NI is just an income tax. The pension is a ponzi scheme. If I was left to invest my NI then I would do so. I don't see why I should have to pay twice over.

Anonymous said...

I must congradulate Brown (he is not worthy of the title Mr.) on his great efforts to destroy pensions and pensioners since Labour has been in government.
He robbed the pension funds and caused most of the final salary schemes to close or collapse.
He has never kept the state pension in line with the actual inflation experienced by pensioners.
He never raised inheritance tax in line with house price increases.
He has now reduced interest rates so much that pensioners savings are worthless and pensioners income from them has dissappeared.
Raised taxes so much (10% to 20%) that he is making paupers of us all.
This is with two major exceptions, first Mp's pensions are NOT affected under the pension fund taxation rules - what a surprise - and MP's pesions have risen out of any proportion. So what they do not rob us of during their time in office ( so called expenses) they will in their retirement. Wonderful that all public jobs are protected by inflation linked pensions so they rest of us pensioners will continue to support them on our meagre savings and pensions if we have any.

James F. said...

Isn't all government merely "Mob Rule , by force" anyway?

Heres to "Might Makes right!"
Cheers! :\

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