Recently a physician I know and respect
indicated that a child born to day could easily live to be 105, in good
functioning health. This with the known
medical craft of today. Another article
indicated that by the turn of the century we could expect people to live 200
years, also in good health. A recent
death in my family produced a plethora of picture of old looking relatives (my
parents among them) who rarely lived to more than 60 years. At 40 they were old. What can I say about me, who is in his 79th
year and feel, mentally at least, decades younger.
The reason that I make these observations
is that I cannot think of one think tank (and there may be some) who has
addressed this problem in terms of what such longevity will mean in social and
political terms. If a person who is
50ish loses his/her job today it is unlikely that he/she will find
employment—ever. This in an environment
where most people live (at least in the first world countries) past 80. Adding another 20 year to longevity will put
extreme pressure on the work force. Who
will make room for younger workers where the existing workers work past 80
years of age. If one assumes that
retirement age (say 65 or even 70 years of age) remains relatively constant it
is possible that people will be retired for more years than they were at
work. How will society adjust to
that? The pressure that this may put on
the medical resources of our community will be enormous. I can only assume that, by the time people regularly
live to 105 we will have solved the problem of cancer or dementia. We will therefore have a great deal
relatively well people in our society who are not working. What do we do with them? What do they do with themselves?
As a student of economics I am wary of
those who play with demographic numbers. Malthus who believed that, since
people multiplied in geometric progress would soon outstrip food supply did not
take into account fundamental changes in the technology of growing food. The greater population was well
accommodated. I am assuming that
technology will accommodate our order populations. However some basic questions still arise.
We put an enormous value on work. What we have learned from the recent downturn
is that when businesses increase efficiency during a downturn the last unit
added is labour. Those who argue that
people will be needed to manufacture technology devices (people built cars that
replaced horses and wagons) do not take into account the labour saving aspect
of most technologies. It took 20 years
for the computer to demonstrate its efficiency in the work place but, having
done so, the effect was profound. I
believe that we will move into some sort of economy where the value of work
will be supplanted with something else.
What that “else” is, as yet, unclear.
Our current pension algorithms are just
starting to take into account longevity data in a world where many people live
well into their 80s. Therefore most
pension funds are woefully underfunded.
When news of this underfunding hits management (as it must with current
accounting rules) many companies “reorganize” under bankruptcy protection rules
where the underfunding is eliminated—to the detriment of existing
employees. Because competition is so
fierce the pressure on existing labour rates is such that the employees can
save little or nothing for their retirement.
The confluence of these events will be catastrophic in the future.
There are but two issues that require some
discussion. There a re many more. Most governments today can’t think beyond the
next election. Therefore there is little
or no discussion or analysis of what life will be like beyond 2015. However, the problem, like global warming,
won’t go away. We will reach the tipping
point and when our leaders respond it may be too late.
