While the Greek experience may be the extreme, it provides a good lesson of promises made, but not kept; how dependence on entitlements can be a cruel trap and how politicians will do almost anything to keep votes and stay in power.
Politicians make promises they can’t keep, public employee unions sell their votes for overly generous pensions, unions and other organizations and voters oppose necessary changes. All the while Congress ignores the well-known problems with Social Security and a socialist promises higher benefits as the retired population grows and the working population declines.
American voters should take note‼️
There have been calls for reform of Greece’s pension system since the 1980s when worries arose about the mass retirement of baby boomers coinciding with a working generation with falling birth rates. The problem of an ageing population was not unique to Greece. But while other European countries, like Sweden, carried out reforms in the 1990s, Greece held on to its ill-structured system. Entitlements were calculated by an array of special regulations that varied not only among the numerous different funds but also among workers belonging to distinct groups within the same fund. Factors like age, gender and union membership made the system discriminatory: some got a lot while contributing little; some got little despite paying a lot. The most successful attempt to change the regime came in the early 1990s, but it only managed to scratch the surface. Strong unions, professional associations and some sectors resisted any change that would deprive them of special treatment and politicians gave in to save their seats. After 1992, pensions were not matched by contribution increases, says professor Platon Tinios of the University of Piraeus; they became reliant on state grants that were financed by external borrowing. Source: The Economist