Final Word from Monday, April 19, 2010
The Constitutional Court told us on Fri. what we have all known for years. Namely, that Czech "social insurance" isn't insurance at all. It's merely a tax by another name. The Court argued in effect that pension payouts to high wage-earners are too low and need to be raised to avoid discrimination. Some politicians immediately started talking about the added costs this would bring to the state budget, but Finance Minister Eduard Janota identified it as mainly a matter of semantics. If we start calling it a tax, he said, nothing else will need to change. ČSSD jumped on the idea too. It's the most likely outcome, but it's a dangerous one. Removing any pretense of a correlation between pension contributions and pension payouts would be like going off the gold standard. Lawmakers would have no restraints and would be able to freely devalue your pension, just as central bankers have devalued your money.[Czech Republic social security pensioners]
Glossary of difficult words
semantics - the meaning of a word, phrase, sentence or text;
pretense - an attempt to make something that is not the case appear true;
correlation - a mutual relationship or connection between two or more things;
restraint - a measure or condition that keeps someone or something under control or within limits;
to devalue - to reduce or underestimate the worth or importance of; to reduce the official value of a currency in relation to other currencies.