Compulsory Retirement Savings

I’ll admit to toying with the idea of compulsory retirement savings. At least, it would be an improvement over the current ponzi-scheme. Even if I were forced to save, say, 10% of my income in a private account, at least it would be mine someday.

Turns out Hong Kong has such a system, called the Mandatory Provident Fund (described in this Cato Journal article). I heard of this system today, from a colleague in Hong Kong is leaving to return to his home country. He informed me that there’s “a ridiculous amount of bureaucracy to go through to leave here.” He said he had to pay a US$20K income tax bill before leaving. I was surprised–what if you just leave? I can’t imagine red tape to leave a country. He said if he leaves without jumping through the bureaucratic hoops and paying the tax they say he owes, he won’t get his “superannuation” money back–i.e., the money he’d been forced to save. In other words, even though it’s nominally in a private account, it’s really in the government’s control.

We must get the government out of ALL retirement savings.

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1:55 am on October 6, 2004