The government proposal for the social security reform is clearly dependant on the management of the political cost.
The relevant minister decided to present a patchy reform that transfers the weight from existing pensioners to employers, employees and future pensioners, in hopes that the governing party will hold onto the 2.5 million citizens who receive a pension today.
A clear and rational choice to address the problem at present would be a direct 6 to 7% reduction of all pensions.
Instead, he chose to further burden the already struggling economy by increasing insurance contributions by 1.5% and 30% cuts for future pensioners, starting with those who will retire in 2016.
This whole proposal is counterproductive – since it prevents the recovery of the economy – and undermines the credibility of the social insurance system.
This is simply because employers and employees are called upon to support a precarious system that will pay out significantly lower wages with higher insurance contributions.
How many young employees will accept such an unbalanced and problematic relation and not pursue alternative employment relations and insurance?
It is a well-known fact that nothing is inconsequential in politics. Every choice has its effect.
In this case, in order to avoid fully assuming the political cost, it was decided to debunk and eventually deconstruct the social insurance system in the so-called name of preserving and rescuing the welfare state….
Finally, in response to the government propagandists who attribute the social security crisis to the 12.5 billion euros losses suffered via the PSI, we must remind them that between 2001 and 2014 a total of 201 billion euros from the State budget went to the funds so that pensions can be paid out without a problem. They still can’t see the forest for the trees…
That, unfortunately, is the bitter truth about social security. Everything else is for the gullible and two-bit propagandists…
Antonis Karakousis
