While the mainstream media has most Americans fixated on Miley Cyrus’ tongue and DMX’s drug problems, governments around the world are raiding private pensions to reduce government debt. To put it plainly, the governments of the world are looking to use private pensions to fund big banks, or at the very least using private money to hedge against future bailouts.
Zero Hedge discussed the raiding of private pensions in Poland while no one was looking:
On Wednesday, Prime Minister Donald Tusk said private funds within the state-guaranteed system would have their bond holdings transferred to a state pension vehicle, but keep their equity holdings. The funds would effectively be left with only the equities portions of their assets, even this would be depleted, and there will be uncertainty about the number of new savers joining.
In New Zealand, a similar scheme is being discussed:
The National Government are pushing a Cyprus-style solution to bank failure in New Zealand which will see small depositors lose some of their savings to fund big bank bailouts, the Green Party said today.
Although many would insist that such a grab couldn’t happen in the U.S., we should note that many areas in Michigan don’t even have an elected government with which to decide how to dispense with pensions. Governments in those areas have been overtaken by financial managers appointed by the Republican governor.
This was written by Electablog prior to Michigan being appointed an emergency manager:
If Detroit gets an EFM, 49% of the African Americans in Michigan will live in cities where their elected officials have been replaced by a single, state-appointed ruler. …
If you include cities that are under consent agreements, Inkster with its 18,381 African Americans and River Rouge with 3,950, the percentage rises to 50.6% — over half.
The school districts with Emergency Financial Managers are also in majority black cities:
- Detroit — 82.7%
- Highland Park — 93.5%
- Muskegon Heights — 78.3%
No one can predict the outcome, but the trend of state sanctioned cash grabs along with the weakening of democracy is a troubling sign. We’d all be better off keeping our collective eye on this and avoiding the media created events intended to distract us away from important economic developments.