Private pension schemes won't solve demographic problems

Private pension schemes are a risky solution to the demographic crisis in the West, the conservative daily Magyar Hírlap writes: "The private pension system appears to offer a way out of the predicament, but this is deceptive because private pension funds invest the payments made by future pensioners in the shares of transnational companies that make extra profits in regions of the world where on the one hand the birth rate is high while on the other wage costs are extremely low. ... The problem with this is that you can also lose in this pyramid game because those regions are increasingly rebelling against this strange 'division of labour'. Last year at a global level ... around a third of all savings in private pension funds simply 'disappeared'. The loss amounts to around five billion US dollars. ... Considering that in the long-term there will be many pensioners and fewer active people (because fewer children are being born), private pension funds also threaten to collapse."

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