Loomio
August 12th, 2017 09:35

Retirement and Superannuation Policy

Daymond Goulder-Horobin
Daymond Goulder-Horobin Public Seen by 509

Retirement and for the most part superannuation policy is a key issue in this coming election. I am interested in hearing your thoughts on key issues in the debate as well as researched and informed discussion on both sides, including:

  1. Should we commit to keeping the Retirement age at 65. A number of arguments exist and its largely to do with the capacity to work at or above 65, for instance we are living longer but that may not necessarily mean that we can work for longer. On the other hand it is argued that if it is raised to 67 then kiwis will still likely get the same amount as people did the day it was put to 65.

  2. Should the pension be income-tested?

And More Soon

Colin England

Colin England August 12th, 2017 22:41

Just cancel it an put in place a UBI. Then people can work or not as they choose.

Tane Harre

Tane Harre August 13th, 2017 08:01

A UBI at pension level would cost a little over $69,299,520,000/year if you paid everyone over 15. That is after tax too. We currently spend about $9,000,000,000/year on SA.

(I have removed the tax as it is really silly for the govt to say here is $1, now give us $0.25 in tax......What? No. We paid you a dollar!)

Bruce King

Bruce King August 13th, 2017 20:14

In an alternative view, a UBI doesn't cost anything as it is merely a redistribution of income.
How much does it cost you if in a year you are taxed $5K, $15K or $25K extra but then receive back $15K as a UBI?

Colin England

Colin England August 14th, 2017 00:18

A UBI isn't a cost - it's the funding of the economy.

Economic Cycle

Daymond Goulder-Horobin

Daymond Goulder-Horobin August 14th, 2017 10:12

It may need to still be adjusted by age. Younger people have the capacity to work 40 hours a week while the older generations may only be able to handle 20 hours. Therefore perhaps something like a $200 UBI and then another +$200 retirement would work or something similar.

Suzie Dawson

Suzie Dawson August 14th, 2017 12:08

I know very little about the 65 vs 67 debate and also about UBI other than what it is in principle

Would appreciate any links on either!

IA

idiom axiom August 14th, 2017 21:12

UBI = end, Winz, public education, pensions, public healthcare and instead give everyone a small amount of money via the IRD. People get more money and better service due to removal of giant useless bureaucracies and replacement with markets.

Colin England

Colin England August 15th, 2017 00:02

This is Keith Rankin on it: [UBI as a Reconceptualisation of Income Tax](http://www.scoop.co.nz/stories/PO1603/S00396/ubi-as-a-reconceptualisation-of-income-tax.htm]

This is someone else: HiveMind: Universal Basic Income - Are we up for it?

And this a main NZ site for it: Basic Income New Zealand

I've only just got those in my inbox and haven't read them yet.

This is an article that I wrote on it several years ago: Universal Income & the Minimum Wage

And the article I wrote on the monetary reform I see as being needed for a UBI to be enacted: Real Monetary Reform

Colin England

Colin England August 15th, 2017 00:10

Nope.

Public healthcare would still exist because it's the most efficient form available.

If you want to get rid of giant, useless bureaucracies then you need to be looking at the private sector. Their bureaucracies are far larger and less efficient:

It compared their performance with companies that remained public and with their own past performance as public companies. The result? The privatized companies performed worse than those that remained public and continued to do so for up to 10 years after privatization.

It's only ideology, a belief, that private does better and it's wrong.

Suzie Dawson

Suzie Dawson August 15th, 2017 03:26

thank you

IA

idiom axiom August 15th, 2017 04:21

Public healthcare is a method of funding. UBI is a replacement method of funding.

IA

idiom axiom August 15th, 2017 04:24

Healthcare is one of the things that will take the longest to become post-scarcity, because you can spend a near infinite amount of resources trying to extend ones life.

Shall we gear our entire economy towards keeping old people alive a month longer, a week longer, a day longer, until we spend 20% of GDP like the monopolistic US?

Colin England

Colin England August 15th, 2017 12:16

Public healthcare is a method of funding. UBI is a replacement method of funding.

No it's not. A UBI is there to meet basic needs. The healthcare system is there to meet healthcare needs.

Tane Harre

Tane Harre August 16th, 2017 01:26

That doesn't work if you think about it. Say there is a tax of 50% to pay for the UBI that funds the private sector that gets taxed 50%. Each time the money goes around your tax income is halved yet you still have the same outgoing.

IA

idiom axiom August 16th, 2017 08:04

Why can't a ubi meet healthcare needs? A lot of healthcare counts as basic needs.

Tane Harre

Tane Harre August 16th, 2017 09:36

I do agree with the UBI. I just don't agree with the graphic. A better picture for me would have been comparing the UBI to raising the minimum wage. Since 2007 we have raised the minimum wage (hopefully with a roll on effect) by $180/week without blinking.

Colin England

Colin England August 16th, 2017 22:57

Say there is a tax of 50% to pay for the UBI that funds the private sector that gets taxed 50%.

You misunderstand.

The money is spent by government into the economy. This is by wages, salaries and the UBI. These people are going to want services that they're willing to spend that money upon. Most of those services are going to be provided by the private sector.

As that money passes through the private sector it's returned to the government in various ways such as FTT, GST, and charges for using the states resources.

There's also a multiplier effect. Each dollar will pass through multiple transactions before it's returned meaning the tax at each transaction can be minimised.

Each time the money goes around your tax income is halved yet you still have the same outgoing.

The government is creating the money in the first place. It's a not a fixed amount of cash and that's it. In fact, I'd expect the government to run at a deficit. It should be a minimal deficit that reflects the development of the economy but still a deficit. To cover that deficit they create more money.

Tane Harre

Tane Harre August 17th, 2017 08:47

I had forgotten about the multiplier effect. I have serious doubts about the government creating that much money in the first place though. Remember money is based on trust. The US went through a period of quantitative easing (creating money) and their dollar dropped compared to ours. The only reason they were able to stay up was because they have the largest military (Eg; they are able to back their dollar with force) which gave trust in their currency.

Daymond Goulder-Horobin

Daymond Goulder-Horobin August 17th, 2017 13:02

Very good discussion going on here. I would like to try and keep discussion to working out how to handle the act of a person going from full time work to retirement and how we should keep that person in check. I believe that a UBI would be a good way forward to ensuring that people have at the very least a fallback and an assurance that as a Citizen you have a right to acquire basic needs for oneself. But we run into an issue where a UBI would be enough for the ones that can work but not enough for people that are unable to work as long when they get older. Henceforth either a retirement add on would need to go on the UBI or the retirement pension would still be separate.

Discussion the UBI on its own should go in the UBI thread. But certainly interactions between UBI and retirement can be discussed here.

https://www.loomio.org/d/xAB9ThWv/universal-allowance-basic-income-

M

Martyn August 17th, 2017 15:02

I've got no problem with the Pension age being raised, I had pretty much committed to working till I died anyway so it doesn't really bother me.

What does income testing entail?

Colin England

Colin England August 17th, 2017 23:43

Remember money is based on trust.

There's no elimination of trust. We have a viable economy supporting it.

And no matter what, governments can't actually go bankrupt like private banks can.

I have serious doubts about the government creating that much money in the first place though.

The private banks create billions every year. It's what's been driving housing prices over the last few years.

I suggest that we stop the private banks from creating money at the same time as we bring in a UBI. We'd probably see a decrease of money in the system over time as bank money is paid off.

The US went through a period of quantitative easing (creating money) and their dollar dropped compared to ours.

It was a slight drop. England, the EU and several other countries did the quantitative easing as well. What they were actually trying to do was to crash their countries currency so as to boost export trade which is why several economists and other commentators referred to it as a trade war. That was also the reason why no currency really dropped much - they essentially all dropped together.

The only reason they were able to stay up was because they have the largest military (Eg; they are able to back their dollar with force) which gave trust in their currency.

Nope. It was because:

  1. The US$ is still the Reserve Currency (This really is a licence for them to print money. In fact, it was their printing of money that got them to drop the Gold Standard that they were supposed to maintain according to the Bretton Woods Agreement)
  2. Other nations were also engaging in quantitative easing dropping their own currencies. In fact, NZ was one of the few who didn't which is why we saw our currency rise
Tane Harre

Tane Harre August 18th, 2017 02:02

The economy is only viable while the economy is viable.

And there is an elimination of trust because you have just f'd over the banking system by removing their money creation ability. To do so you would have to give the ability for to reserve bank to create money, essentially nationalising the banking sector. Nationalising your banking sector would remove you from the International banking system, the banks would call in their loans. Credit ratings would drop and interest rates go up.Then you are faced with the choice of creating vast sums of money to pay the loans...and not just govt debt....which would place New Zealand in default. Inflation would go through the roof.

So to insure trust you would have to pay New Zealand's debts first.

Countries can go bankrupt, it is called default.

It wasn't a slight drop. It hit a record low in 2008 and each time quantitative easing happened it just about hit that low again in 2010 and 2012.

Military power - If you look at the countries the US has tried to/or has overthrown is recent years quite a few of them had dropped the US dollar in the years before. Iraq dropped the dollar in 2000 (invaded 2003), Libya in 2009 (military intervention 2011), Syria dropped the US dollar in 2006 (the same year the U.S. and its allies began discussing plans to overthrow it).

New Zealand also went through a dairy boom which forced our dollar up and saved us from extended recession.

Colin England

Colin England August 18th, 2017 03:56

And there is an elimination of trust because you have just f'd over the banking system by removing their money creation ability.

It's either them or us. Leave it as is and it will be us.

To do so you would have to give the ability for to reserve bank to create money, essentially nationalising the banking sector.

The Reserve Bank already has that ability. IIRC, Labour used that ability to extend a non-repayable loan to a foreign corporation to set up here.

Nationalising your banking sector would remove you from the International banking system, the banks would call in their loans.

So? If they try they simply lose immediately whereas if they maintain relations they'll get their money back eventually.

When you loan some one money you're taking the risk that you're not going to get it back.

BTW, I'm only talking about removing the private banks ability to create money which is rightly called a Ponzi Scheme. They'd still be able to loan out any money that they have deposited for that purpose. The government won't guarantee it at all though and if the bank loses so do the depositors.

Credit ratings would drop and interest rates go up.

Interest rates would be at 0%. That's the beauty of using a Sovereign Money System. The government never has to borrow and, in fact, shouldn't.

New Zealand also went through a dairy boom which forced our dollar up and saved us from extended recession.

More likely to have deepened it actually. A higher dollar would have decreased our exports and thus decreased employment. And you'll note that that boom ended resulting in our farmers so far in debt that they can no longer maintain the farms. The banks did well though.

The mistake you're making is to assume that a high dollar is good but it is neither good nor bad. You're also assuming that a high dollar represents people wanting buy our stuff which isn't exactly true either - it's more because we have the highest interest rates in the world.

Then there's the purpose of exchange rates (which is taught in economics) and that is to balance trade between countries. A high dollar would, if the exchange rate was operating correctly, show that we're importing too little while exporting too much. It's actually backwards because of that high interest rate and we're actually importing too much and not exporting enough.

If the exchange rate was working correctly our dollar would be significantly less than it is now.

There's a difference between the way things are and the ways things should be and I'm specifically saying that we need to change to the latter.

Bruce King

Bruce King August 18th, 2017 09:52

(Imho UBI is the way to go, as above) but imo 1 is your simple question: yes, leave it at 65. Raising it won't be a huge fiscal saving and afaik not even the Nats want to raise it until around 2040, so imo let the 65 yo's be.

IA

idiom axiom August 21st, 2017 08:29

Bruce King

Bruce King August 21st, 2017 19:07

I think his response to Q on UBI, from 1m57s, is utter utter BS: "The question of 'what will that do?' is completely unanswerable. We have no idea what that will do." What?!! NZ Superannuation is already a UBI ffs. The Corporatocracy will stonewall UBI as it empowers people, aka 'the workforce'. To hear them tell it, it will always need more testing & trials.

Colin England

Colin England August 23rd, 2017 00:20

We actually have a very good idea as to what it will do from all the trials over the last 40+ years. It appears that a few people don't what it will do and so rant against the UBI.

IA

idiom axiom August 23rd, 2017 08:16

We do know that mice die off in utopian conditions.
We do know that inherited wealth seldom makes it past 3 generations and the grandchildren are oft rotten.
We know many people have quite negative reactions to retirement. Even wealthy early retirement.
Its not an argument against UBI, its more of a warning not to think its going to be a magical panacea.

Colin England

Colin England August 23rd, 2017 23:26

We do know that mice die off in utopian conditions.

Citation needed

We do know that inherited wealth seldom makes it past 3 generations and the grandchildren are oft rotten.

That would explain all those families that have been wealthy for centuries.

We know many people have quite negative reactions to retirement.

Yep. One reason why I think a UBI would work as people simply prefer to work than do nothing.

Its not an argument against UBI, its more of a warning not to think its going to be a magical panacea.

Nothing's a magical panacea but UBI as a replacement for most of our present welfare system would be a hell of a lot better to everyone but especially to those who are dependent upon it and those administering it.

IA

idiom axiom August 24th, 2017 00:41

Mice:

Population went extinct, only ever got up to 60% of carrying capacity. Duplicated with rats.
A good break down of the experiments and the papers:
https://www.youtube.com/watch?v=HfNKFvHtA3g

The families that have their wealth continue for centuries are pretty seriously dedicated to it. It doesn't happen by accident.

Daymond Goulder-Horobin

Daymond Goulder-Horobin started a proposal August 27th, 2017 06:23

Retirement - Commit to keeping it at 65 Closed 6:20pm - Wednesday 30 Aug 2017

It is a good step forward to first make some clear commitments. I believe that the first would be to come to a decision on whether in any case whether we continue with the development of UBI or not that we will keep the retirement age and the eligibility for pension (or increase in UBI) at 65.

Results
Agree - 7
Abstain - 2
Disagree - 0
Block - 0
9 people have voted (0%)
Daymond Goulder-Horobin

Daymond Goulder-Horobin
Agree
August 27th, 2017 06:26

I believe that while people are living longer that the capacity for people to work is not going up. Therefore we should keep it at 65 for now.

Jo Booth

Jo Booth
Abstain
August 27th, 2017 06:43

I think 65 is an arbitrary age - not sure either way

Miriam Mallinder

Miriam Mallinder
Agree
August 27th, 2017 09:00

mind you, give it two decades and there might not be the work for people to remain in anyway and retirement will have to drop! Bring on UBI ...

Bruce King

Bruce King
Agree
August 27th, 2017 09:35

Tane Harre

Tane Harre
Abstain
August 27th, 2017 10:08

I think it should but also think it should be job and average age adjusted.

BC

ben cooney
Agree
August 27th, 2017 21:02

Colin England

Colin England
Agree
August 27th, 2017 21:38

With the proviso that the if we do decide to have a UBI policy that it doesn't rise at the retirement age.

Suzie Dawson

Suzie Dawson
Agree
August 28th, 2017 07:00

Colin Smith

Colin Smith
Agree
August 29th, 2017 09:58

I am assuming that the vote is for "Open a discussion on this issue of "Keep of Drop"

Daymond Goulder-Horobin

Daymond Goulder-Horobin August 29th, 2017 10:00

Its basically saying that with or without the UBI we hold the official Retirement age at 65. That also includes things such as Kiwisaver, gold cards etc on top of the pension which may or may not be dropped if we press forward with the UBI depending on future decisions and votes.

IA

idiom axiom August 30th, 2017 09:37

Would have voted no.

Johnny Canuck

Johnny Canuck September 26th, 2017 03:19

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