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In most of these cases there is one primary motive: LET MY GUYS GET THEIR HANDS ON THIS MONEY! Even if "their guys" only pocket 3% of the money and effectively flush the remainder that is o.k.---so long as the blow up doesn't come for a few years.  So think the cleptocrats in the USA and, evidently, in Europe.

In the US this is always presented in the context of "Social Security is Doomed," with the sub-text "we have always said this was a very bad idea and won't work. See, we are right."  Meanwhile, they raise withholding for Social Security to levels that would be sufficient, but use the additional revenue to finance deficits.  In eight years Clinton reduced the deficit so as to better enable the government to handle the coming surge in demand from the baby boomers.  Didn't take W long to reverse that. Then they blame "government" for their own cleptomania.  "See, even when you raise withholding there is still not enough."  (There never will be so long as Social Security obligations are taken "off budget." So we might as well cut taxes on the wealthy. Getting the money (back) from the rich is of course, "Class Warfare."

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed May 21st, 2008 at 12:24:40 AM EST
In addition to allowing the hands of 'their guys' on the money, it also ties the future pensions of the working/middle class to the financial markets. This is very useful in times of busts, when lucrative bailouts of high-power investors also benefits (to a much smaller degree) 'ordinary' people. The better to make more entities that are 'to big to fail'.
by someone (s0me1smail(a)gmail(d)com) on Wed May 21st, 2008 at 11:16:39 AM EST
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Not to mention that the high powered investors that are bailed out are mostly "their guys."  That is why I am taking the hit of inflation and leaving my paltry retirement savings in "cash."  Most investments promising reasonable yields are at risk for substantial haircuts, with the benefit accruing to those same underwater "high powered investors."

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed May 21st, 2008 at 12:50:58 PM EST
[ Parent ]

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