This writer's wife, having complied with the requirement of being 60 years old and having contributed to Social Security for 35 of those, retired at the beginning of this school year. Calculating the approximately 2,500 euros she'll find deposited in her bank account every month (but not for the fact that this amount will be indexed, to some degree, to inflation) as yield on Europe's risk-free benchmark investment - the Bund - we can assure the reader that her personal net worth, not including any savings or physical assets, is no less than 2,238,805.97 euros.
Income - 2,500
Interest rate - 1.34%
Spanish union leaders Cándido Méndez and Ignacio Toxo, true to the cause of the working class as their rhetoric might ring to those who believe that all problems, and their solutions, were described for eternity at the end of the 19th century, will quite simply be protecting the right of millionaires to remain so as they clot up the streets of every city in the country.
Moving on to the related theme of the economic costs of concentrating buying power in the pockets of groups that spend the least money, we'd suggest that the current trend towards lengthening the working lives of contributors in order to ensure the solvency of pension funds is wrongheaded nearly to the point of being suicidal. Lowering, on the other hand, the retirement age to 60 would immediately absorb about 1 million unemployed from the ranks of the younger.
Taking a high guess at an average pension of 2,000 euros a month, the cost to Spain would be 2.4 of GDP per year. Bearing some of it would be a considerable rise in VAT revenues as money gets into the hands of people that don't (like this writer) pine over the demise of a much-loved 8 year-old shirt - because they change their wardrobe every year. Another share would come from the evident increase in employment and SS and income tax receipts that would accrue from any invigoration of Spain's moribund domestic economy. The rest gets funded with income tax hikes. Until it is proven that eating the future of the young makes for a free lunch, there isn't one.
In the incalculable benefit realm - exactly what is the return on the state's investment in education when the youth unemployment rate verges on 50 percent?
Others recently attempting to deal with the issue of too much wealth in the power of low spenders are Cassandra, with his neat and tidy recommendation for the American version of the same problem, and Chris Dillow with his Steely Dan parable describing intergenerational differences in the marginal utility of consumption.
With any luck, the above will provide a bit of assistance to Stanislas Jourdan's (our favourite Occupy/Indignado blogger) wonderment at the fact that no European union leaders seem even to be minimally concerned about the problem of unemployment.
*One could, of course, calculate that at the current yield on the 10-year bono and come up with a mere 510,204.08 euros. Anyone with the gall to do it at Ibex Salad, however, should be prepared to present a notarized document attesting to the fact that they have never, over the length of the crisis, subscribed to the notion that Spain was on the verge of defaulting.