This can HAPPEN in the United States all of you disciples of Barack OBAMA!

Our subject today is not Barack Obama's "change" plan to "share the wealth." But readers who want to know what happens to a nation that legalizes plunder -- as the 19th century French economist termed the taking of private property for socialist ends -- will want to pay attention just the same.


Argentina is a constitutional republic with many historical similarities to the U.S. It has a rich immigrant heritage and an abundance of natural resources. But the U.S. is a rich, advanced country and Argentina is poor.


How did the breadbasket of South America fall so far behind? One explanation goes back some 90 years, when the Argentine Supreme Court began chipping away at property rights as a way of addressing economic inequality. Argentine politicians quickly learned that lawful plunder was their path to power.


This history is still being written, and the latest chapter ought to frighten Americans.
Buenos Aires as an example of "sharing the wealth." (Nov. 3)


After seven straight years of driving up government spending and hammering every capitalist in sight, the Argentine government, which went bust in 2001, is running out of money -- again.
No surprise there. For more than a few years, analysts have warned that inflation, trade protectionism, disregard for contracts and confiscatory tax rates were having a deleterious effect on capital flows.


Suboptimal investment rates, the same analysts warned, would mean economic trouble when global growth began to slow and the commodity boom came to an end. But former President Nestór Kirchner (2003-2007) and his wife, current President Cristina Kirchner, had promised to bring change to Argentina and didn't want to hear it. They thought they saw better returns to their own bottom lines by stoking class warfare while increasing government spending.
That revenues would, at some point, fail to meet the rising expenses of the welfare state was predictable. The only mystery was when the wall would be hit and how the further plunder to make up the difference would be carried out.


On Oct. 21, Mrs. Kirchner ended the suspense by announcing that the nation's private pension system -- with a stock of $30 billion and a flow of $5 billion annually -- would become government property. To put that in words that Americans can more clearly comprehend, it would be as if the assets of all 401(k)s were suddenly swept out of owners' accounts and into a single government account.


Mrs. Kirchner defended her decision to seize the pension assets by asserting that the market is too risky for retirement savings, and that the returns earned by private-sector fund managers are not adequate.


That's quite a claim considering that the average annual return of Argentina's private-sector pension managers over the past 14 years is 13.9%. But it is even more absurd if one compares the private-sector returns to those of the government's pay-as-you-go social security system over four decades.


Last week La Nacion columnist Adrián Ventura reminded his compatriots of this "history of state fraud." In the 1960s, "the law guaranteed retirees 82% of their salaries," Mr. Ventura writes. But, he says, "it became impossible to calculate." How come? Because the government did not publish the true rates of inflation and, more broadly, because politicians had zero interest in protecting the assets. "The government did little to maintain its promise to pay good pensions to workers," Mr. Ventura explains, "and it did a lot to make use, for itself, of their savings."


The columnist was not just teaching a history lesson. He was reminding change advocates that plus ça change, plus c'est la même chose. Today, the Argentine central bank stands accused of manipulating official inflation data and, because politicians have been spending like mad, between now and the end of 2009 the government will encounter a $10 billion financing gap.


By law half of the privately managed pension assets are already allocated to government debt. But it is not unreasonable to suspect -- as more than 70% of respondents in a Buenos Aires poll said last week -- that Mrs. Kirchner is acting not to achieve better returns, but to get her hands on the rest of the money ahead of midterm elections next year.


Mr. Ventura echoes the fears of many when he writes that her legislation "puts almost no limits on how the money can be used, and if it did, nothing would stop the government from modifying it or ignoring it."


Long-suffering Argentines know well that once converted into "an instrument of plunder" there is no limit to the pain the law can inflict. Americans might note that even when government is already highly interventionist, things can get worse.

By the way, this article is from the Wall Street Journal. All of you Obama fans, imagine tomorrow if he seized your parents 401k's and pensions. How does your life look then?