From Bloomberg: “Argentines Decry State’s `Disastrous’ Record as Pensions Seized.” Excerpt:
Fourteen years ago, Raul Zimmermann opted to contribute to one of Argentina’s new private pension funds because he didn’t trust in the state retirement system. Now he’s outraged by government plans to seize his savings and take responsibility for paying his monthly benefit.“The history of the pensions managed by the state is disastrous,” said Zimmermann, 69, who started drawing a pension two years ago. “It’s not reasonable that they transfer my account without even asking me if I want to.”
On Oct. 21, President Cristina Fernandez de Kirchner announced plans to take over $29 billion of private pension accounts, saying a state-run system would protect retirees from fluctuations in financial markets. Roque Fernandez, an economy minister and central bank president in the 1990s, said the move is a “confiscation” of people’s savings. . .
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Also, see this OpEd from Investors Business Daily: “Argentina Spreads the Wealth.” Excerpt:
U.S. Democrats in Congress are mulling like-minded moves to scrap 401(k)s and transfer them into government-managed “guaranteed retirement accounts” with a 3% return, according to James Pethokoukis of U.S. News & World Report (full disclosure: Pethokoukis is a former IBD reporter).Before they charge ahead, they should look at what happened since Argentina’s announcement: Its stock market lost 23% of its value in two days, for a 57% loss since January. The losses spread to other markets in Brazil, South Africa and Spain.
Markets don’t like expropriation of private property