Remember that old morality tale about the thrifty, hardworking ant and the spendthrift grasshopper? In the 2011 version, you star as the ant and the government co-stars as the grasshopper.
Ireland has announced that it intends to tax (a far more pleasant sounding word than confiscate) parts of hard-working Irish citizens’ private pensions so politicians can invest (a far more pleasing sounding word than redistribute) the proceeds as it sees fit.
The good news is that Ireland would only add a 0.6% tax on all private pensions. The bad news is that not all governments are so munificent. For example, Argentina seized all private pensions in 2008. Ireland claims the tax will end in four years, but doesn’t every tax begin with a politician’s claim that it’s only temporary?
Do not doubt for a minute that it could happen here.
Investors Business Daily provides a little background:
Back in 1993, the Clinton administration sought a “one-time” tax of 15% on every private pension, 401(k) and IRA. The money was to be given to those with no retirement savings. All told, $450 billion in private assets would have been seized.
Lucikly, Republicans won back Congress in 1994 and the concept died. Or more accurately, it went into suspended animation – a suspended animation from which it has recently awakened.
Back to IBD again:
Just last year, White House officials floated similar ideas after it became clear deficits and debts from “stimulus” spending were out of control and that lots more money would be needed.
Quietly, they talked about taking all private retirement savings and putting them into special government annuities that would provide you with a “lifetime income.” Except, as with Social Security, they can take it back anytime they want.
Be prepared. Do what you have to do to protect your own assets from politicians who think they know now to spend your money than you do.
You’re making a mistake if you trust that these people have your best interests at heart. In fact, you may be making a mistake if you trust that they have hearts at all.
Source: Investors Business Daily
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