Tuesday, December 2, 2008

Ireland: Pension Plans "Close to Collapse"

According to the Irish Independent of December 1, 2008, there is mounting fear that many defined benefit pension plans are "close to collapse," and that, with the pension deficit approaching €30 billion as financial chaos spreads, as many as half the plans could fail within a year's time. There are approximately 67,000 defined benefit pension plans in Ireland, of which 90%, or more than 60,000, are expected to report funding deficits to the Pensions Board in the current period.

Nor can pensioners expect the government, already in serious financial trouble, to bail out the plans. There is thus a high likelihood that benefits will be severely curtailed, despite whatever was promised. There are approximately 340,000 people covered by private defined benefit pension plans in Ireland, or around 250,000 active workers and 90,000 retirees.

We have made a number of approaches to the Irish government over the past couple of years, but only received a single, rather mild e-mail reply that someone's assistant would "look into it," "it" being the Just Third Way as detailed in Capital Homesteading for Every Citizen (2004). A Capital Homesteading program for Ireland would be relatively easy to implement, and both swift and effective in its beneficial effects. The only problem we face is getting someone to listen to us — ironically, the same problem that has virtually halted visible progress in the United States. Slavish adherence to Keynesian economics and assumptions virtually ensures that nothing can — or will — be done.

If they wish to regain effectiveness and stabilize the economy, the government of Ireland should immediately appoint a commission to study the implementation of Capital Homesteading at the earliest possible date. The alternative is to make Ireland as bankrupt as the Keynesian system into which the country seems locked.

Donations to CESJ support our Capital Homesteading projects and Just Third Way initiatives, and are tax deductible in the United States under IRC § 501(c)(3).





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