As U.S. Dawdles, Sweden Reforms Pension System
September 27, 2001
As ill-advised as Sweden's addiction to the welfare state may be, at least it has moved to individual social security accounts. That's more than the capitalistic U.S can say.
- Since Jan. 1, all Swedes who earn wages have been able to put 2.5 percentage points worth of their 18.5 percent payroll tax contribution into an individual account.
- An individual worker may choose to invest in up to five mutual funds he has from among 600 which are available.
- The new program, known as the Premium Pension System, passed the Swedish parliament with 85 percent approval.
- Observers say that journalists were particularly skeptical and often compared projected benefits under the new system with benefits under the old system -- even though the old system was headed for bankruptcy.
Source: Jeremy Hildreth (American Skandia, Inc.), "Even They Do It: Socialist Sweden Surpasses America on Pension Reform," Investor's Business Daily, September 27, 2001.
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