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Inflation Versus Unemployment

Inflation is the greatest threat to retired people on pensions.

Ever since the Great Depression, unemployment has been seen as both the endemic and the most dangerous disease of modern society and economy. Under pension-fund socialism, inflation can be expected to take over both roles instead. Inflation is the greatest threat to the retired people on pensions, and an equally great one to the workers over fifty with an increasing stake in the future purchasing power of their retirement benefits. Together, these two groups constitute a near-majority of the adult population. These two groups, as a result of pension-fund socialism, have a far greater interest in preventing inflation than ever existed before. A substantial constituency of this kind, sharing a common concern, is by definition a major “interest group” in the American political system and a potent political force. At the same time unemployment is far less of a threat, if a threat at all, for the “constituency” of the pension funds, that is, retired people and older workers.

ACTION POINT: Do you agree that inflation is a bigger problem than unemployment?

The Pension Fund Revolution

* Source: The Daily Drucker by Peter F. Drucker

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