When a government retires people

Germans have been debating retirement age like the rest of the industrial world. They are having a hard time squaring higher life expectancy with the patriarchcal ways of old Europe.

The world's first universal social security system has seen interesting an unexpected twists in its 150 year history. For starters, it was instituted by a deeply conservative chancellor. Having survived two world wars and made the transition into the 21st century, it was conservatives who started cutting back on future entitlements as early as the 1980s and social democrats and Greens who put the axe to the system in the early 2000s.

The debate in Germany has seen the same arguments as everywhere, but there are a few aspects worth highlighting.

Governments are bad at managing money!

Not quite true. Here is why.

There is a pension fund system for German government employees who are not "Beamte", i.e. for employees who have not sold their lives and their souls to the government. They are treated like workers in private businesses but do get a supplementary pension. That pension has been managed by a pension fund, unlike general social security.
The fund gets very little media attention but has been doing astoundingly well through all the ups and downs of the economy.

The fund is run by professional fund managers. Unlike general social security, politicians have not been able to use it as a slush fund cum piggy bank to fill holes in the general budget.  So, we should probably say that politicians are bad at managing money.

The other aspect we want to highlight is the rigidity of the retirement age. For the longest time, retirement age meant that you had to retire, no matter what. And once retired, you were not allowed to continue to work for money.

The 80 something U.S. worker happily contributing to society in a job was an outlandish concept to Germans.

While Germans have loosened this strict rule once they started treating social security pensions as taxable income, they still won't allow you to "just continue" to work beyond retirement age. Even if you feel like working to 80 and claim benefits only at that age, no dice.

What the government can do, however, is retire you against your will. This is gone regularly if you become unemployed in your late fifties or early sixties, or if you become disabled. At this point, you receive a reduced pension. The maximum reduction currently stands at about 14% and applies for the rest of your life.

The most recent change to the contribution scheme was dropping the equal share of contributions paid by workers and employers. Up until this year, half of the social security contributions came out of people's pay check, the other half was paid by employers.
Starting now, the employer share is capped at the existing rate, while the share of the employees is not.

Of course, the government made sure that there is no rate increase next year.

The option of becoming Walmart greeters does not exist in Germany, after the retail giant quietly pulled out. Rumor has it that the Germans were not into the whole Hail to Sam thing in the morning. Unlike the Chinese by the way, who happily replaced Mao with Sam.