Author Topic: Government seizure  (Read 1731 times)

notmyhand

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Government seizure
« on: June 04, 2019, 06:03:44 PM »
I am originally from an Eastern European country in which the government seized a portion of private retirement funds in order to put it into their version of the social security system.  The argument was that the social security system was short money and in this way it could be made whole.  Additionally supposedly the citizens were not saving enough for retirement and this way the government could make sure their future was provided for.  I was not directly impacted as I was already residing in the United States but heard about it with great anguish from relatives.  It led me to thinking - anyone afraid that it may happen in the US at some point?  And any strategies in trying to protect against it?

rantk81

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Re: Government seizure
« Reply #1 on: June 04, 2019, 06:10:26 PM »
Nope.

BicycleB

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Re: Government seizure
« Reply #2 on: June 04, 2019, 06:32:02 PM »
Not afraid. I would consider this extremely unlikely here.

Not because it's impossible for terms to be changed, or someone to get an unfair deal. But because private retirement funds have strong defenders, while the central government's right to redistribute funds for the common good is viewed skeptically.

In addition, the trend or common problem here is that things happen when a private party can propose or manipulate a public process that subtly benefits the private party's private interest. The scenario you describe seems likely to have the opposite effect.

It is possible instead that private retirement funds could be damaged in a way where some private party (some person or company) benefits at the expense of another private party, perhaps with government sanction. This happened already, in the case where many private company pensions were weakened. Some private investors benefited; many pension holders received far smaller benefits than were originally promised. As a result of these events, investors on this site usually seek to invest directly in corporate stocks, or mutual funds based on such stocks. The underlying companies are strong forces in this society, unlikely to be defeated in political battles. Based on the most recent 40 years of history, anyway.

It's more likely that government pensions would be weakened, not private retirement funds. Some forum members do worry about this. The federal Social Security system is the biggest example. Currently it is projected to reduce benefits 25% starting in 2035 or so. Many threads discuss whether this will happen.

John Galt incarnate!

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Re: Government seizure
« Reply #3 on: June 04, 2019, 07:38:58 PM »
I am originally from an Eastern European country in which the government seized a portion of private retirement funds in order to put it into their version of the social security system.  The argument was that the social security system was short money and in this way it could be made whole.  Additionally supposedly the citizens were not saving enough for retirement and this way the government could make sure their future was provided for.  I was not directly impacted as I was already residing in the United States but heard about it with great anguish from relatives.  It led me to thinking - anyone afraid that it may happen in the US at some point?  And any strategies in trying to protect against it?


OP, since now you live  in the United States you need not fear governmental seizure of private retirement funds.

Under ARTICLE I SECTION 8 of the Constitution of the United States of America, "Congress shall have Power To lay and collect Taxes...and provide for the...general Welfare of the United States."


Suppose the world were gripped by a severe economic depression that lasted for years and years.

If governmentally funded and/or privately funded retirement systems were severely affected to the detriment of the "general  Welfare,"  Congress would simply exercise its taxing power (and other powers) to "provide for the...general Welfare" rather than seize private retirement funds.
« Last Edit: June 04, 2019, 08:10:16 PM by John Galt incarnate! »

Bucksandreds

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Re: Government seizure
« Reply #4 on: June 06, 2019, 08:38:40 AM »
If the people that actually had savings confiscated weren't made "whole" by being given proportionally higher payments in the "social security" system then that's some of the shadiest government underhandedness that Ive heard of.

former player

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Re: Government seizure
« Reply #5 on: June 06, 2019, 12:56:35 PM »
What would technically be possible would be for the government to change the taxation rules relating to privately held pension funds, for instance so that over a certain amount tax needs to be paid on capital gains or dividends.  But there are likely to be easier targets for increasing taxes which would be utilised first.

partgypsy

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Re: Government seizure
« Reply #6 on: June 06, 2019, 01:01:01 PM »
Would you share what country this happened to? I do know of many "wealth re-distribution" tactics that have happened in African countries. Also in Mexico during a certain time (government seizure of land). I'm not as up on Eastern Europe.

Cassie

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Re: Government seizure
« Reply #7 on: June 06, 2019, 01:08:41 PM »
That will never happen here. 

Laserjet3051

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Re: Government seizure
« Reply #8 on: June 06, 2019, 01:31:11 PM »
already happens here, every single day. what difference does it make which pile of your cash the govt forcible takes? As JGI stated above, the govt has authority to forcible collect taxes in the best interest of the welfare of its population. confiscating an extra $10K via payroll taxes or consumption taxes or 401k is substantively different, how?

solon

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Re: Government seizure
« Reply #9 on: June 06, 2019, 01:36:26 PM »
They're taxing people's savings because people don't save enough. Brilliant.