Instead of holding hostage for more than a week the crew of a U.S. surveillance aircraft and inspecting the plane to garner potential secrets of sophisticated U.S. spycraft technology, the Chinese ought to have captured something truly of value to their country: namely, an understanding of the workings of the U.S. funded pension system.
In dismantling a U.S. company, or labor union organization, or public pension sponsor, the Chinese would have discovered a technology in retirement financing programs as sophisticated and fascinating as that of the spyplane.
The retirement time bomb of an aging and very poor population is a much bigger threat to China's wellbeing than U.S. military spying. Until China begins to solve its retirement financing issue, the vast majority of its people will be hostage to continuing poverty in old age. And the effort of capturing pension funding technology is less daunting than international political confrontation. U.S. corporations, labor unions and public sponsors generally are very willing to exchange business-related ideas with China, all toward enhancing the lives of its own citizens. These U.S. sponsors operate pension programs that have provided - despite flaws and failings of regulations and some pension sponsors themselves - a generally reliable measure of retirement income and security.
The Chinese, in fact, have an example in their own country: the Hong Kong Mandatory Provident Fund. As reported in Pensions & Investments, Hong Kong companies last year were required by law to start defined contribution plans. But that's only Hong Kong, already a sophisticated business center. In resuming control of Hong Kong, the Chinese rulers should speed up the integration of ideas involving pensions to the rest of the country.
Too bad for China, its rulers sacrificed precious time preoccupied with diplomats and international brinkmanship instead of actuaries and strategic investment allocations.
