A Modest Proposal for Social Security and Medicare Reform

[Smid]

In Australia, we have a 9% compulsory superannuation contribution for all employees earning over a certain amount - I think that amount is about $450. It effectively resulted in a 9% pay rise for all employees when it was introduced - so wages didn't increase for a while afterwards (it effectively results in compulsory savings). There may have been some form of business tax cuts or something at the same time as it was introduced, to reduce the burden on business. The Government provides the pension to everyone over the age of, I think 65 (women is 63 I think, although it increases by a year every two years until reaching parity with men), so it forces people to save for their own retirement, but still protects those who don't amass enough savings themselves. I think it's a fairly balanced approach that doesn't disadvantage the poor, while still not burdening the government to the same extent as a straight out pension would.