Japan has been grappling with its demographic statistics with a sense of urgency, particularly regarding its declining birth rate. In 2023, the country...
Capitalism is totally different from a ponzi scheme. In a ponzi scheme, the profits go up to the person at the top and you always need new people that come in, otherwise the whole thing will fall apart and the people at the bottom will be the ones that suffer. Under capitalism however, the profits of everyone’s work will go up to the top and you always need new workers to come in, otherwise the system will fall apart and the people at the bottom will suffer. Totally different.
Once crapitalists run out of “new horizons” to “expand” into, they start cannibalizing their current workforce and raise prices while lowering quality for customers.
Do not be fooled. Quality is going down because profits are going up.
A Ponzi scheme is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors.
Meanwhile, the current pension system in most countries depend on a growing population to spread out the payments for pensioners over multiple workers.
Ponzi schemes collapse when there aren’t enough investors to sustain the dividends to be paid to the existing investors. Most countries’ pensions rely on an increasing amount of working age inhabitants to pay retirees and are now having issues paying out pensions due to the shift in demographics, that’s why many countries have been increasing the retirement age recently.
There are 2 solutions to this.
Increasing birth rates, this option is not sustainable in the long term but is commonly preferred for reasons mentioned below.
Migration. There are currently plenty of countries with a large working-age population and a weak economy. Letting those migrate would solve the demographic issue, but is political suicide.
Of course I understand that the money that is put in is invested, but that doesn’t mean the problem goes away when the system relies on the “pot” growing at a certain rate.
EDIT:
Mismanagement/poorly built systems are not the same as Ponzi schemes. Unless you think, I don’t know, US Social Security is also a Ponzi scheme?
I’m not implying that it’s the same, just that the comparison fits better than you might expect.
Capitalism is totally different from a ponzi scheme. In a ponzi scheme, the profits go up to the person at the top and you always need new people that come in, otherwise the whole thing will fall apart and the people at the bottom will be the ones that suffer. Under capitalism however, the profits of everyone’s work will go up to the top and you always need new workers to come in, otherwise the system will fall apart and the people at the bottom will suffer. Totally different.
Hm. There is a difference.
Once crapitalists run out of “new horizons” to “expand” into, they start cannibalizing their current workforce and raise prices while lowering quality for customers.
Do not be fooled. Quality is going down because profits are going up.
Don’t you mean “suffer more”?
True
Maybe this ponzi. Unfunded state pensions use workers contributions to pay current pensioners.
Less workers = less pensions.
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I think it actually fits quite well.
Meanwhile, the current pension system in most countries depend on a growing population to spread out the payments for pensioners over multiple workers.
Ponzi schemes collapse when there aren’t enough investors to sustain the dividends to be paid to the existing investors. Most countries’ pensions rely on an increasing amount of working age inhabitants to pay retirees and are now having issues paying out pensions due to the shift in demographics, that’s why many countries have been increasing the retirement age recently.
There are 2 solutions to this.
deleted by creator
This misunderstanding is on your side. There is a method of funding pensions refered to as pay as you go (PAYG).
This is exactly how many unfunded, state sponsored pension schemes function. No pot of money exists. Only the ability to collect taxes.
This is true for private pension schemes run by companies and individual pension schemes. Funded pension schemes are (usually) not ponzis.
deleted by creator
I don’t think you know what you’re talking about.
The UK State Pension is unfunded, which means that its obligations are not underpinned by an actual fund or funds. Such schemes are often referred to as “Pay As You Go” (PAYG). The pension payments made by the government for unfunded pensions are financed on an ongoing basis from National Insurance contributions and general taxation.
deleted by creator
Of course I understand that the money that is put in is invested, but that doesn’t mean the problem goes away when the system relies on the “pot” growing at a certain rate.
EDIT:
I’m not implying that it’s the same, just that the comparison fits better than you might expect.
In most PAYG state pensions the contributions made by workers are not invested. They are paid directly to pensioners.
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