How will this work realistically? How will you convince employers to keep workers employed till 70? Especially in fast changing fields like IT where a lot of old knowledge and experience gets considered obsolete by those screening resumes. Sure, people might survive longer, but that doesn't mean all workers will be equally mentally or physically fit to still perform well at some jobs at 70 as well as a 30 year old, especially if they're mentally or physically challenging jobs.
I'm not talking about government paper pushing jobs, but private industry jobs with international competition where you need to be agile and up to speed to survive as a business. This system worked for the boomer generation in slow moving highly regulated industries like steel, rail and automotive, where you'd spend all your life at one company who'd promote you and invest in your training till retirement, but this isn't as common anymore. International companies now want things done faster and cheaper and can't be competitive keeping 70-year-olds on the payroll idling around waiting for retirement.
For example, here in Austria, if you're laid off at the age of 50, the chances of getting another job at that age for many professions are already next to zero due to rampant ageism, so workers in some professions end up on long term unemployment till retirement, yet the government agencies are not talking about this major issue and just tell the 50 year olds on long term unemployment to "make a more colorful resume to stand out"(I shit you not). You're also not allowed to take your contributions out of that pot early or all at once to fuck off out of the system and be on your own if you want, proving it is Ponzi scheme in disguise.
- housing for 80k USD is 525k DKK: no way you can find anything at that price anywhere close to cph. Not sure for other "major" cities, but in cph you can expect to pay 4mil DKK (600K USD) for a ~60 sqmt apartment, prices will fall outside the cities, but nowhere close to 80k USD. Where did you get that number?
- you pay for your unemployment benefit, thought an a-kasse. Its not forever and it might barely cover your bills depending on where you live/your mortgage. If you have family its probably not enough and you need to add an insurance on your salary on top of that.
That is why I explicitly said major cities and not Copenhagen.
Look 20 minutes out of Odense, Aalborg, Randers, etc.
Don't let yourself believe that a country is nothing but its capital - it is correct, that if you decide to live in a 4mil DKK apartment in the Copenhagen area, then you have also opted out of public help, and you are on your own.
I think it's worth remembering that Hacker News is a global platform and if someone refers to "major cities" in Denmark, for many (most?) readers, the only name that would come to mind is Copenhagen.
I've actually spent a week in Copenhagen relatively recently and I literally couldn't have named another city in the country. My bad, I know, but I'm pretty well-traveled and that's the truth.
Again: That is why I wrote major cities - I wouldn't expect anybody to know.
Again - why this extreme focus on the specifics? I merely argued that the housing market in the broader Denmark is reasonable, and you can usually easily commute to jobs in a city while living cheaply - something that is strictly more difficult in the US.
Because from the point of view of the rest of the world, there aren't any major cities in Denmark other than Copenhagen...
Saying that there is cheap housing 20 minutes outside of a town with 64K people doesn't really make the point that it's inexpensive and accessible to live in / near major cities.
Cph is one of the major cities, and the biggest one. It's also the area with most population density and opportunities. I won't say that you are wrong because I'm not familiar with what you can find 20 min of Aalborg, etc, but I find disingeneus portraing a picture where in dk you can buy a house for 80k USD and leaving out the information that you are probably in the middle of nowhere - no jobs, no public transport, no services. It's not that people "decide" to live in cph or in a major city, they are basically forced to if they need to have a job and do stuff. Sure, if you work remote and like being in the countryside alone you have a lot of options, most people don't have that luxury.
If I say that you can get a house for 80K in the US, do you then automatically assume I mean San Fransisco or New York?
> but I find disingeneus portraing a picture where in dk you can buy a house for 80k USD and leaving out the information that you are probably in the middle of nowhere - no jobs, no public transport, no services
The point is exactly the opposite. You can get a house at a reasonable cost, 20 minutes away from a city you can likely get a job in - Even well paid tech jobs (They exists in both Odense and Aalborg).
I fint it disingenuous to pick pick out a very specific situation like this instead of looking at the broader argument.
Yeah, no. Most homes are in the range of 1.500.000 to 2.500.000 kroner. There are some homes closer to 1.000.000 kroner that need repairs or remodeling. You are not buying anything livable for 500.000 kroner, sorry. Those days are in the past. And mind you, these numbers are for medium-sized cities. Not any of the desirable cities, like Copenhagen, Odense, or Aarhus.
For most of history, care for the elders was a family responsibility first and a local community one second.
Only for a short period were western population growing so fast relative to small number of retirees that transferring that responsibility to government was a no brainer.
With diminishing demographics anywhere except maybe Africa, we'll need to be more creative once again. Raising retirement age is just one of many hard but inevitable policies.
A new category of jobs will be created: retirement jobs. People unable to work till their retirement age, will be given simple low paid jobs to earn enough work hours to hit their retirement. Think of all the simple jobs currently outsourced: content moderation for social media websites, training data tweaking, LLM training, teaching assistants, street cleaning assistants, etc.
But employees are not just pure net gains. If you hire a bunch of "retirement jobbers" you will still have to manage them. It sounds logical at first that you simply hire a few older people for lesser pay but in Europe the question is also why a 65 year old would accept a far lower paid job if he can simply go back on welfare and get paid the same? The reality will probably be that most old people will be unemployed so long that nobody wants to hire them even if they could hire them for a very low amount. People at that age will have a lot of pride built up, they are not going to want to stand in a supermarket for 3h a day either. Is society really going to force them? So far they are barely even willing to force young people to get jobs.
Just because you can hire a 68 year old to do content moderation or be an assistant teacher... does not mean that anybody actually wants him around at that age and that he will be a net gain to the environment. His speed and ability at work is inherently going to limit other people's speed in some way or form,not even just that. Even his vibe, his impact on the team. These things are all things that people consider during hiring. It's the concept of "the chain is only as strong as its weakest link" I suppose.
The government itself could hire many of them at a lower price point. Similarly, firms relying on content moderation farms could use the elderly population. Low wages, social corpo cred and government support (see subsidies) are things they could get for using this. And this would be cheaper than outright paying for the full needs of an ever growing elderly population and an ever shrinking working population.
Sure, no will force to take up the jobs but when the choice is heating up your home in winter or working a couple of hours per day, the decision will be obvious
>The government itself could hire many of them at a lower price point.
To do what?
>Similarly, firms relying on content moderation farms could use the elderly population.
Why would they do that when AI or foreign labor is cheaper? And this is happening right now, let alone in 2040 when there will be more automation and more offshoring. There no room for low-skill repetitive jobs in developed western economies unless you go full communism where the government employs everyone.
>A new category of jobs will be created: retirement jobs.
Who will create these job? Especially given the push towards more Automation in the west or at least outsourcing these easy repetitive jobs to countries in with lower wages as it is the case right now. When you call tech support, does an elderly US person answer or a person from India/Asia/LatAm? Do you think they'll hold back technological development just to give meaningless work to unemployed old people in the west?
But say such jobs are created, given how many youths are unemployed(in Europe at least), why would they hire people close to retirement instead?
The west has built itself into in a pickle with needing to work longer till retirement but has fewer easy jobs left due to automation, high labor costs, and outsourcing. What are you gonna do then, go back to uni and study another Masters' degree at the ripe age of 60 so you can retrain for another specialized job?
I’m not sure how I feel about this. I’m based in the Nordics and my estimated retirement age at the moment (where I can get my state pension) is 67y 4m. Whilst I understand the burden the aging population is having on society (lifespan) it doesn’t seem like there’s much proactive government input into people’s healthspan.
Maybe instead we should try investing in this area (reducing the burden on services) instead of simply trying to reduce the quantity of folks claiming from the state pension pot.
No. I am suggesting that governments invest more into ensuring their aging population is healthy instead of draining every bit of life from them by making them work later and later.
It’s not just about expanding lifespans. The cratering birth rates are a huge reason why societies are going to need people to work until they’re older.
Sure. But is that the society we want to live in. Do we not have ambitions to have people work less, enjoy what little life they have more? I'm not saying this is an economically easy problem to solve, but we focus so much on economics and so little on policies that make people happy.
> Do we not have ambitions to have people work less, enjoy what little life they have more?
Isn't that something for the individual to decide, not the collective? Many derive from work a lot of meaning in life. If working is what makes some people happy, it would be nice to not punish people for working until they die.
> I'm not saying this is an economically easy problem to solve, but we focus so much on economics and so little on policies that make people happy.
Drugs make people happy. It's not the state's job to define happiness for its people, it s there to manage the economy so they can find the happiness they like.
Economically, old people are a burden on society. If you want to have a long and easy retirement for your elderly, you need a growing population, forever. Like a ponzi scheme. The alternative is that you break young people's back by burdening them with providing for the elderly. No amount of redistribution will help a country with poor productivity. 60 was a reasonable retirement age years ago, because most people would be dead soon after retirement, but with people regularly reaching 80+, 70 for retirement seems very reasonable. It wouldn't surprise me if the average gen Z reaches 90+, so maybe they should be working until they're in their 80s.
A rich person doing nothing is not productive. They produce by giving their money to someone that is productive and getting rent on it. If billionaires and aristocrats were actually a sizable amount of a country's wealth it might make sense to redistribute their wealth to the actually productive people. But they're not.
If you had to pick an age for societal burden, it'd be the average "young" person who isn't making a net-positive contribution until around the age of 25. Most people don't receive a corresponding 25 years of retirement, and the retirement they do receive is a product of contributing to it for 40 years.
But it turns out young people become middle-age people, become old people, and we're all in this together. The real problem is not about how the pie is split across generations, but about the realities of lifespans, economic production, and expenses. If you're responsible for funding the entirety of your retirement, all of this is abundantly clear. When you nationalize retirement, all sorts of budgeting tricks start happening, like "borrowing" to fund other programs, papering shortfalls via population growth, etc. Then you start getting age warfare when the govt has to eventually cut back.
You could dissolve the national retirement plan, but that seems like a bad idea for similar reasons as entirely dissolving national welfare and insurance programs. It will always be the case that some people, need some help, some of the time. I guess in my ideal world, it's reduced to a much smaller safety net, because the government is managing the economy well enough that the populace has the wherewithal to save appropriately, and they are educated enough to do so.
Young people are an investment. Old people are purley a liability. This is true regardless of how they're cared for, when looking at it from a macro perspective. How the pie is split matters when talking about the sustainability of the system. Could you survive if 90% of your value is in investments? Maybe. 90% in liabilities? Probably not.
Having people fund their own retirement would be ideal from a economic standpoint, but given the histories and complexities of existing systems, it is probably not acceptable politically, or morally, in any country. Honestly it's a distraction.
At the end of the day, a country cannot tolerate too many freeloaders. It doesn't matter if they're pensioners or retired at 50, living to 100 hedge fund managers. Productivity is really the only thing that matters for a countrie's economic destiny.
That's a nice way to restate that young people will have to produce more, and receive less. But tell me, what incentive do you have to produce more when you'll just have it snatched away to be given to someone else? Why not move to the U.S where your productivity will be rewarded, or just put in minimal effort?
Young workers will produce more regardless because people don't stop being innovative. The incentive to produce more is that economic surpluses improve the standard of living for everyone, including young workers.
Is it better that retirements are funded by this surplus from the increased productivity, or by direct taxation on the income of young workers? Income growth doesn't keep pace with productivity so it's an easy answer.
Taxing the income of current workers to directly fund current retirees is the real "snatching away what you produced". If more national pension plans invested in broad-based stock indexes instead they wouldn't need to take more and more money out of young people's pockets.
Capital ownership entitles you to its returns. Young workers typically don't own a lot of capital. So it comes down to either retirement plans owning it, which means young workers also get its returns when they retire. Or a small wealthy elite could own it all, and everyone else gets left out, reduced to moving a dollar from an youngsters pocket to a retiree.
I am Gen X and fully expect to be working until 70, hopefully.
I knew a guy who worked full time at a bank at 85. He said all the time he didn't have to work but what else was he going to do all day? A big reason he was able bodied at 85 was from working and not sitting home all day.
I think we have confused retirement fund/planning marketing with reality.
The retired people I know are physical mess from retirement. Alcohol and restaurant food all the time, will be needing long term care much sooner than if they had worked longer.
As an American, I’m often that countries like Denmark are in fact constantly investing in health and entitlements, and so everyone is healthier and happier. Is that not the case?
Denmark has a lot of social services, and commensurate taxes to support them. This is reaching a breaking point. You can't get more blood out of a body that has already been drained to near the point of death.
In my part of the Nordics (Finland) they are cutting investment and sending people to private institutions. In rural areas private providers have entirely replaced public sector healthcare centers. This is seen as quite controversial across the board.
No, the taxes we pay are going to private institutions driven by profit instead of into funding public institutions that don't have this self-interest. This is not a model I support.
I can only speak for the two countries I've lived in (Finland & UK) and society is not amenable to privatisation in either. In the UK pretty much everything that has been privatised has been ruined (water, energy, transport) with high prices and poor service.
I honestly didn't think anyone in the US considered healthcare socialized (same for housing and a big chunk of university-level education), so I've learned something today.
I personally find it hard to reconcile the concept of socialized healthcare with UnitedHealth Group being apparently the 7th company by revenue in the world, at least I don't think that's what Europeans would mean by "socialized".
As someone from the US, I consider all those industries to be almost fully for profit. Our k-12 education is public, but constantly under fire to move those public funds to private providers via various voucher programs. I would say that each of those industries have various regulations around them, so maybe that's why the commenter thinks it's socialized.
Average lifespan is 81 in Denmark and 78 in USA. During the pandemic, average USA lifespan dropped to 76, while in Denmark it didn't drop below 81. So yes, it seems they are in fact healthier.
We have the same problem as every other western country. Sweden has lowered the taxes by about 500 billion SEK (corrected for inflation and population growth) since I was born close to 40 years ago. That is about a third of the annual budget.
How these tax cuts are distributed over the population is... not very evenly. There was even an article yesterday in the NYT (iirc) that warned about wealth accumulation patterns in Sweden.
It is the same neoiberal experiment that the US has had since Reagan, just with some more social democracy.
Denmark is not constantly investing in health and entitlements at all. On the contrary unemployment benefits and such has been slashed. Over the last two decades there has been many broad cuts to public services. The health sector had to do percentage fixed cuts every year for several years in a row.
Building on that, instead of viewing retirement (age) from a cost perspective (i.e. we have x budget and y lifespan, hence retirement age is z), it would be refreshing to see a high-quality and long retirement as starting point, and then figure out how to organize for that. One way would be to reduce burden on services indeed. A low retirement age (for those who want it) is a sign of a wealthy nation and something to strive for.
> Maybe instead we should try investing in this area (reducing the burden on services)
This doesn't require any investment or technological development; it just requires making rational-but-politically-nuclear policy changes reducing the infinite tap of publicly-funded extremely-low-ROI medical expenditures on old people.
An absurd fraction of medical spending goes to protracting the suffering of old people just a bit longer. We can simply stop doing that, given the political will to do so.
Extending people's lifespans won't do much to alleviate these expenditures, except perhaps to slightly dilute the amortization schedule.
The centre right often argue for less taxation ‘to grow businesses’. The argument being that the economy grows and that’s how the money is recouped. At least that’s what’s happened here in New Zealand.
Looking past ones next pay day does seem universally difficult.
You have to grow your economy at a rate that allows you to pay for the additional pensioners.
Birthrates seem very hard to change and even if change would happen it is much too slow.
Germany did the experiment on immigration and has not seen GDP growth for half a decade. There the system is failing far worse in some ways, but in Germany employees are paying directly for the pension plans, so the state just raises the employee contributions.
Because Germany does nothing to attract and keep employable immigrants. They only want to keep immigrants which completely tow the line of only speaking German, which inevitably attracts mostly bottom of the barrel. Significant portion of highly qualified workforce in Germany is umemployable because of refusal to conduct business in anything other than German.
Also, the beaurcracy is the real culprit for growth.
Getting immigrants who work is a non-issue. I never heard of immigrants from India, China, Africa or Latin America who don't work so long as they entered the country legally. The issue you are alluding to has to do with genuine refugees and illegal economic migrants, who are not filtered at the border depending on their employability within the local market.
But the cultural shift is still inevitable. A foreigner is not a local, and it is neither fair nor ethical to expect a foreigner to transform themselves into a local.
I think, if you are concerned with the cultural shift, you can give immigrants temporary term VISAs and make it clear their stay is going to be strictly temporary. That was supposed to be how the Gastarbeiter system works. Thing is, when you have already on boarded a foreign worker and have had them working for you for 2 years already, you don't want to let them go and replace them with a fresh foreign worker who you have to retrain.
Assimilation as most people understand it does not necessitate an immigrant become completely indistinguishable from a native citizen. There are some baseline expectations that are not always met right now, such as learning the official language of one's host country, and sometimes its social standards. Most countries simply lack the necessary coercive incentives to make that happen systematically. I would argue that most Western cultures have become too individualistic at the expense of societal health, fueling the notion that assimilation is inherently unethical.
Without establishing a hermetic environment a la the Amish, assimilation happens automatically in the next generation if a nation has basic structures in place like public education to some minimum standard and basic anti-discrimination laws to allow economic advancement. Children absorb the culture that surrounds them, often to their parents' dismay.
Mhm, the current generation of kids of Turkish immigrants in Germany all seem to believe they are actually displaced Turks. I suppose thats what you encourage with double passport and voting for authoritarians at "home". (of course they are totally out of place in Turkey, that part of assimilation is unavoidable)
This is not borne out by the anecdata I have collected over the last 22 years as a foreign invader living in and observing Europe. Moroccans in the Netherlands, Albanians in Switzerland, even Irish Travellers in Ireland-- despite being integrated from primary school onward, all seem to be somewhat apart from the host culture even after several generations.
And yet they remain a distinct cultural group with different traditions and modes of living, despite integration at a school level. Apparently they've even diverged genetically[1] from the main population.
The data I saw is that by the third generation, only a few percent speak the language of their grandparents' country, and most marry outside their nationality.
In the US, Italians, Irish, and Germans, as just a few examples, all were treated as unassmilated aliens. People say the same things, generation after generation about newcomers. If you moved to a country with a different language and culture, you might make an effort to learn the language but you would still think, read, etc. in your native language. Your kids would know both languages; their kids would of course speak the language of their surroundings.
What solves these problems is a fundamental belief in freedom for all. People don't need to speak your language to be your equal and be just as human, with the same rights as you.
This was certainly true of my Polish ancestors. My great grandfather arrived at age 19. He never really became fluent in English but could get by when he needed to. My grandfather spoke both Polish and English but only spoke English at home once he had school aged children. My father really only knew the Polish swear words and I know a handful of Polish phrases that only get used amongst family at Thanksgiving or Christmas. Don’t ask me to write them down. I’ve only ever heard them verbally.
Italians, Irish, Germans in US are bad examples, because Americans and Western Europeans are basically one and the same culture, the only significant difference being the language spoken. I suppose integrating Chinese or Indian people might take much longer.
In fact, they were seen as very different cultures and the exact same things were said about them. Only in hindsight do people say what you are saying (and in hindsight they will say the same about today's immigrants). In fact, the world has never been smaller or more homogenous - people in countries all over the world dress like us, are exposed to our culture a great many already speak English. Before you spread damaging misinformation - there are few evils inflicted by and on humanity than those based on these prejudices - shouldn't you know what you are saying? Shouldn't we talk great care?
Here's Benjamin Franklin (Palatine refers to the Holy Roman Empire or Germanic regions, depending on the source):
"[W]hy should the Palatine Boors be suffered to swarm into our Settlements, and by herding together establish their Language and Manners to the Exclusion of ours? Why should Pennsylvania, founded by the English, become a Colony of Aliens, who will shortly be so numerous as to Germanize us instead of our Anglifying them, and will never adopt our Language or Customs, any more than they can acquire our Complexion.
Which leads me to add one Remark: That the Number of purely white People in the World is proportionably very small. All Africa is black or tawny. Asia chiefly tawny. America (exclusive of the new Comers) wholly so. And in Europe, the Spaniards, Italians, French, Russians and Swedes, are generally of what we call a swarthy Complexion; as are the Germans also, the Saxons only excepted, who with the English, make the principal Body of White People on the Face of the Earth. I could wish their Numbers were increased. And while we are, as I may call it, Scouring our Planet, by clearing America of Woods, and so making this Side of our Globe reflect a brighter Light to the Eyes of Inhabitants in Mars or Venus, why should we in the Sight of Superior Beings, darken its People? why increase the Sons of Africa, by Planting them in America, where we have so fair an Opportunity, by excluding all Blacks and Tawneys, of increasing the lovely White and Red? But perhaps I am partial to the Complexion of my Country, for such Kind of Partiality is natural to Mankind."
It often takes three generations. The first generation came willingly and thus have an incentive to put up with shit; the second generation did not, find people hating on them anyway, and understandably react by pulling back and doubling down on their heritage.
I fundamentally agree with your comment. But for Denmark, it is very difficult to learn Danish. I lived there 3 years, took courses and was at end able to do my daily stuff in English, but a part of the society simply does not want a foreigner to speak Danish. You are forced to use English.
My girlfriend asked me once in a Restaurant (Cafe Norden in Kopenhagen) why I was ordering in English. Then, I spent the complete evening ordering everything in Danish, to always receive answers in English. And this nearly everywhere (not my bakery, the girls there could not speak a word of English, this was an exception). This was in the early 2000's. This never happened to me in all the other countries I have been living in. A Danish colleague simply told me that he does not like to listen to broken Danish, better switch to English.
Still have a lot of friends in Denmark, integration there is not easy, even for highly qualified people from the EU.
Danes are by and large all English speakers, probably the last generation who would have much difficulty with conversational English are all 70+ years old now. And while Danes are generally very polite and friendly with foreigners, there is a level of personal closeness (part of the "hygge" concept) that you will rarely penetrate if you are not a lifelong close friend or family member. This is another part of why real integration into Danish culture is nearly impossible for a foreigner.
I observed over my 11 years in the Netherlands that the friendliness and quality of service I received was greater when I spoke English and much diminished when I spoke Dutch. The Netherlands is, similar to Denmark, a place where people would seemingly prefer to speak English than listen to an accent on their native language.
I had a similar experience in the Netherlands. We could have a 30 second exchange in their perfect English or a laboured 2 minute conversation in my abysmal Dutch. I struggled to improve because everyone would immediately switch to English.
I commend you for your efforts and I'm sure they were appreciated even by those who switched to English with you. It sounds like you were in the infamous long awkward intermediate stage of language learning. Depending on the cadence of your language classes, three years may not be a long time. Intensive language programs with daily lessons and drills are exponentially more effective than typical language-learning programs spread out across short sessions sprinkled throughout the week/month. In my opinion, it makes a lot more sense to place newcomers in intensive learning programs on arrival than to accept they will not be functional outside of ethnic enclaves, and wait decades for their children and grandchildren to finally integrate, as other commenters suggest. It's not an easy process and we can't expect everyone to have the intrinsic motivation to do it all on their own, which is why incentives are needed.
> you can give immigrants temporary term VISAs and make it clear their stay is going to be strictly temporary
In practice that rarely goes as intended. The first political party to say, "We changed our minds, you can all have citizenship," gets to secure power with an influx of loyal voters.
Maybe I misunderstand your point but... if these people are not citizens (i.e. they need a VISA) how could they actually vote for whatever party proposing this?
Well, if a party has enough votes to pass such a law, it means that the majority of the society has no problems with that.
Conversely, if this hypothetical party had a secret agenda to pass the law when they get elected, but they kept this a secret until then... first of all they will probably lose of voters in the next election.
Also, they might find out that former immigrants do not automatically reward this behaviour in terms of votes.
I do not find this scenario particularly realistic.
> Immigration only works if the cultures are very similar so that they can assimilate, or the immigration levels are very low.
People just make this stuff up, any rationalization for hatred. It's not hard to see how immigration has worked, how Europe integrates with itself (a continent that fought endless wars before the proto-EU was born), and how the US is a country of immigrants. Rather than repeat it all, see:
"... Why should Pennsylvania, founded by the English, become a Colony of Aliens, who will shortly be so numerous as to Germanize us instead of our Anglifying them, and will never adopt our Language or Customs, any more than they can acquire our Complexion. ..."
It's very easy to see how immigration hasn't worked. Visit London, Brussels or Paris. Compare that to cities that have low immigration rates, like Warsaw.
Europe integrated itself because European countries have very similar culture, and are same/similar race.
You're comparing London, Brussels and Paris to Warsaw? I think most people would consider the former three to be much 'better' cities and greater successes - Paris and London are considered two of the greatest cities in the world! Right there with New York, also a home for immigrants from all over.
Yes, I have. You are living in an Internet disinformation unreality - just like the nonsense the right wing craps out about how horrible and dangerous NY is. As empirical data, look up real estate prices and tourism to the three cities, and see how Warsaw compares. Remember, people in Europe can easily go to Paris or Warsaw; going to London is a bit harder.
And that is with massive disinformation campaigns against immmigrants and 'liberal' cities.
(No offense to Warsaw - maybe only NY and Tokyo measure up to London and Paris.)
Integration is the job of the state as much as it is the job of the immigrant.
In America, we discovered basically by accident[0] how to bring in large groups of people and have them be economically and socially productive. Specifically, we had very generous family reunification programs, which outsourced the question of "what immigrants do we admit" to immigrants who had already successfully integrated. Effectively America became an invite system. The end result is that, for basically any background, every American city has a large and established immigrant population from that country for new immigrants to fall back on.
Other Western countries (e.g. western Europe, Canada, the UK, Australia, South Korea, and Japan) didn't do this. Instead, they treated immigration as a transaction: you can't come in unless you have some immediately beneficial purpose, and permanent residency is going to be an even higher bar still. What this gives you is immigration systems that select entirely for disaffected, college-educated workaholic youths with no connections to the local city. To put it in the words of Canadian Prime Minister Mark Carney:
"America is a melting pot. Canada is a mosaic. In the United States, they don't recognize differences[1]. They don't recognize First Nations. And there will never be the right to the French language."
These words are telling, in ways Carney probably didn't intend. He is proudly admitting that the thing that sets Canada apart from America - the thing that they should fight with military force against a wannabe dictator with annexation dreams - is the fact that they can't integrate people worth a damn.
[0] Family reunification visas were originally intended to deliberately preserve racist prejudices in the US immigration system. This backfired comically.
[1] ...has this guy never heard the phrase 'African-American' before?
Improve the birth rate, yes, but you probably can't do that unless you deal with the resource situation as well.
So you can reduce pensions, improve the situation for the youth, take efforts to get an improved birth rate, making use of the resources lost to pensioners, and then maybe you can raise the pension later on once you realize things are stable.
The total fertility rate (number of children per woman) seems stubborn against attempts to raise it.
I suggest instead altering the male/female ratio, so a stable or growing population can be maintained at lower TFR. Technically, filter sperm to remove those with Y chromosomes before artificial insemination.
Or more. The prevalence of males seems to be an unfortunate consequence of evolution. There's an evolutionary equilibrium of nearly an equal chance of a male or female offspring, even though the ability of the species to reproduce would be higher with mostly female offspring.
No no, not like that. Well, maybe, but no. Most men are useless from a reproductive standpoint because they're not the bottleneck. Women are the bottleneck. More women means no more bottleneck, means more children per person.
Also sexual selection is a thing and I think we were really never meant to have this many men. Men seem good for being really successful or otherwise dying, not much in the middle.
But also, all this talk is purely from a reproductive standpoint. Human societies also need to consider fairness and rights.
If TFR stays well below 2, there's going to be major change sooner or later. The question becomes which change. Maybe the Amish will take over the world? Or maybe some solution we find really weird will be adopted by some other minority and they'll dominate.
I feel like there really hasn't been sincere data-backed methods with proper resources behind them, for example governments giving out minor cash benefits to parents of a few thousand dollars when that's a drop in the bucket compared to the total cost of raising a kid and is not going to convince anyone who wasn't already going to have kids.
Also, that's a wild solution. You'd have to do away with monogamy which would cause some pretty insane societal shifts. However, as a straight guy I can see the appeal lol.
The issue with low TFR seems to be difficulty of forming relationships, not failure to have children once relationships are formed.
I'm imagining it becoming a social norm for single women to have (at least) a single child. Perhaps they'd team up to make raising them easier, forming loose family-like units. Romantic attachments would be optional.
One consequence of such a situation would be an incentive toward private positive eugenics. Women would prefer semen from top quality donors.
At least in the UK the cost of childcare is a major factor putting people off.
People simply can't afford to send a kid to pre-school childcare because it's 2 or 3 thousand GBP per month. So you have to stay at home to look after them, but then you can't afford the rent/mortgage and/or food because you're not working. Woe betide you if you earn over 1 penny over 100K GBP because then you get zero help with costs.
They need to provide more government funded (i.e. universally free non-means-tested) pre-schooling like they do for 5-18 year olds.
I love this as a science fiction thought experiment but altering the male/ female ratio will never happen.
If someone tried to implement it- aside from the obvious problem of authoritarianism- the resulting male minority would live life in romantic "easy mode" so people who want the best for their kids would want male children and rebel against a system more likely to give them female children who would find romantic prospects difficult.
I suppose if someone invented a way to alter sexuality to allow straight women to opt into becoming gay the romance problem could be mitigated, but I'm guessing that this is impossible given the human brain is only so neuroplastic in adult years.
Raising the birth rate is extremely difficult and immigration will destroy a country's culture if not managed properly.
For an interesting case study, compare Japan (who refuses to allow mass immigration and is at risk of going extinct) and the UK (who has embraced it and is on the way to becoming Muslim-majority). It'll be interesting to see in 50 years which one has had better outcomes.
You are not making your point any favour. It is right that everyone is calling you out for your xenophonbic BS.
If it grew 10x between 2001 and 2009 (starting from a very small base), then between 2009 and 2023 it grew by only 0.3x (see graph below).
So rate of growth went from 10x to 0.3x in around a decade, this is a hugely significant deceleration. It actually implies muslim community as portion of population is heading lower.
You're not comparing the same stats. The original stat was growth rate compared to the rest of the country. Islam's overall growth rate has been fairly steady for decades, although admittedly it has slowed, but at a rate that could conceivably stop above Christianity, which your chart shows is decreasing about as rapidly as Islam is rising. I think it's reasonable to project that it may settle below Islam eventually. Realistically, there will be continued backlash by native English and that may temper immigration, though even if immigration stops, the birth rate of Muslims in the UK is still much higher than native population.
However - if we're including atheist then clearly that'll be the majority position.
This is using the same flawed logic that has had people shouting about overpopulation since the 70's: assuming current* population growth rate will continue indefinitely
The difference is that this is a change in the demographics of a population, not the overall growth, which is limited by resources available. The growth of Islam isn't constrained by anything other than the cultural practices that lead to them having more children than the rest of the population and the tolerance of the country for immigration. These things could definitely shift to balance the scales but there's no guarantee that happens and there have absolutely been many times in history where a native population has been displaced by the growth of an immigrant group.
Nicholas, is it clear that at any point in the near future, let's say two generations (30-40 years) the Muslim population will not be a majority in the UK? I don't understand why you continue arguing.
Ah, it's the same argument that my mum uses to say that if we don't do something about "the gays" then straight people will disappear, after all "there are a lot more of them than there used to be".
Actually, OP has given information that proves exactly that. Maybe not in one generation, but Lebanon was in a similar situation where the Muslim population, which was firmly a minority in the 1940s, outbred the Christian population and is currently more than the latter.
I don't have a horse in this game - I'm Muslim after all. But I've experienced London pre-immigration boom and post-immigration boom and I definitely prefer the former, like some of my Muslim peers. The fabric of London has already been destroyed, especially when given the fact that London natives have been priced out of their own homes. Given what I've seen firsthand, and what's preached in the mosques of the UK by unleashed and unhinged Imams, the UK is on track to become a Muslim country in 2 or 3 generations.
The most recent birth rate stats I can find is 2005-2010 where Muslims have a birth rate of 3.0 while the rest of the country is at 1.8. Estimates say it's more like 2.5 now, but the current overall UK birth rate is only 1.57 from a quick Google.
Yes I know the stats hover around roughly that, which is why I requested you to post those numbers as proof for anyone questioning it. There's also the very concerning fact that the last census conducted was before the immigration boom period (2010 or 2011 iirc), so literally everyone is working on outdated data.
Maybe not in one generation, but in 2-3 generations, the UK will definitely turn Islamic, especially given the exodus of other communities. The irony is that the well-off British are settling in the UAE en masse, a distinctly Islamic country, and driving property prices up there. It's not that much of a concern since local housing is distinctly separated from expat housing.
There's not enough immigrants that actually are of financial benefit to Denmark. Only European immigrants are a large financial benefit throughout their lifespan, and Middle Eastern immigrants are a financial detriment even in their prime working years[0]. That is apart from the cultural effects of having a large portion of your population consist of non-Danish, and especially non-European immigrants, which might have its own detrimental effect on the birth rate.
It's not about race, it's about culture and education. For instance, Chinese immigrants are usually an economic boost anywhere they go, due to the can-do attitude and respect for education and business activity in the Chinese culture in general.
Also the Chinese immigrants in question, like many others, usually immigrate seeking a better life, it's a strong self-selection filter. Middle Eastern immigrants of last 10-15 years in Europe are refugees, displaced by wars; they did not choose Denmark (or other Western European countries) because they planned to integrate and to prosper there, they ran there to merely stay alive. They need a lot of help adapting. Even if they are very willing to work, they may lack the knowledge required for gainful employment, and there are only so many dish-washing and trash-disposal jobs.
Those who adapt can make it big; consider people like Freddie Mercury or Nassim Taleb.
The sultanate of Zanzibar is technically closer to Africa than to the Arabian peninsula, it was a remnant of the Omani empire, with very thick Middle Eastern influence, and obviously Muslim culture.
The problem with immigration isn't immigrants, it's racists. Immigration has never caused me any problem at all - it's added a lot to my life and my communities, in fact - and I've lived around many immigrants.
> Chinese immigrants are usually an economic boost
Chinese immigrants were hated and discriminated against for much of US history, going back over a century. You could hardly pick a worse example for your claim.
The US is built by uneducated immigrants - including from China - who came to the land of freedom and opportunity. China was a land of extreme poverty and illiteracy for much of US history (something Western countries had a hand in causing, and I'm very glad for people there that they have so much more prosperity now).
(However, the most prosperous Chinese people are in the democratic areas, Taiwan and, until recently, Hong Kong. It's freedom and democracy, not culture and language that matter. Give people freedom and they prosper.)
It's all just stuff fabricated by racists to rationalize their prejudices. Look at the horrors Europe has inflicted on itself and the world due to these prejudices and rationalizations - the most destructive events in human history. Enough.
More racism on their part - that's the problem, as I said. I also very much doubt that is true, but generally people do generally segregate by economic means, and first generation immigrants understandably tend to live in their own communities, everywhere. Where else do you find people to talk to, who understand you; where else do you even find dinner or some decent proper tea?
Middle Eastern immigrants are not (usually, relatively, on average) unproductive because of their skin color. They're unproductive because they suffer from a large language barrier, tend to have large families that use more government subsidies, are often traumatized by the conditions they escaped, have qualifications that are not recognized in Denmark and have to work menial jobs instead, face racism when they apply for jobs they are qualified for, etc.
And then their children turn out to be some of the most productive and contributory to a nation (in my experience), even despite some of the headwinds.
Perhaps in the US due to pre-selection, but in Europe the 2nd generation of those MENA migrants frequently becomes an even bigger burden to the host countries due to the former turning to criminal activities or radicalization.
"frequently" ... about as useful as my "in my experience", lol
Sorry, I don't buy that argument re: second generation. I've lived and seen it. Perhaps my lived experience isn't representative but I don't see second generation citizens turning to crime or radicalisation in huge numbers. I see them at work, and looking after their families. I fear the brush you are using is so broad as to, sorry, be useless.
"The study has faced criticism over its methodology, as it only studied rape convictions in Sweden. Experts point to the fact that just a small proportion of rapes in the country are reported to the authorities.
Jerzy Sarnecki, a criminologist at Stockholm University, dismissed the study as “meaningless” as it only examined figures for convicted rape.
“They’ve only looked at convicted people, and they make up a fraction of all rapists,” he told Swedish broadcaster SVT."
Even ignoring the above, I can think of many reasons, statistical and otherwise for the apparent difference. Perhaps you should try using your brain matter to do the same rather than just posting random links.
I repeat: I don't see second generation citizens turning to crime or radicalisation in huge numbers.
Agreed. And the idea that you can call people criminals based on their ethnic heritage is plain racism - they are individuals who will themselves succeed or fail, be good or bad, just like individuals whose parents already lived in the country. Some of those people do bad things like promote hate and racial discrimination, but we can't say that about all of them; it's their individual choice and action.
I think it's both. I think race plays part in it because the trend follows with the descendants who often absorb (parts) of the culture. There's also not that much in their culture that would explain it, to me. In my experience they are often hard workers. It's very taboo to say, but there is difference between races.
Is it racist to say that there's difference between races?
DEI is important, specially Diversity. In order to have diversity, you need to have different cultures. Mass immigration erodes diversity. Diversity exists by having different nations with different cultures, not one culture everywhere.
> They're unproductive because they suffer from a large language barrier,
Immigrants everywhere come with a language barrier. If you live in the US, very probably your ancestors did. It's the same with every first generation from everywhere.
The barriers are not all the same.
Somebody moving from Norway or Sweden will have a much easier time picking up Danish. And European immigrants are highly likely to speak English, meaning they can communicate with Danes who speak English (virtually all of them) from day one.
You're really struggling to find problems. English is spoken all over the world - people all over the world learn it, in China, India ... places with completely unrelated languages.
It's because the ME immigrants that make it to Denmark are traumatized refugees from war zones, with education that isn't recognized so they can often only do minimum wage work if they work at all. That's not racist, that's a result of laws and treaties.
I can only give you the rundown for Germany, but I guess it’s similar in Denmark:
Basically the state spends to much money on humans in general.
A young qualified immigrant might have a less negative impact than a slightly older German person, but both of them will be money sinks in the long run.
Statistically immigrants in Germany are less qualified than the general population, so they’ll have an even more negative impact.
The only valid solution is to reduce the spending per person, both birthrate and immigration will only delay the problem.
Denmark should be in a slightly better position than Germany since their health system is cheaper.
> Statistically immigrants in Germany are less qualified than the general population, so they’ll have an even more negative impact.
I need to see some data backing this. Also regardless of stats, many war refugees(the net negatives as told by media) are actually highly qualified but the asylum process and qualification recognition process is eternal. On top of the trauma and uncertainty, they also need to learn a new language, find a new community, patiently go through all the dystopian meetings, cope with their loss of loved ones.
In reality, it is possible for them to be net positive because if things were faster, they would often out qualify the average locals and this also has some effects on wage and market(over supply, constant demand and all the economics).
No one knows how to increase the birth rate. And all the studies show that immigration increases the budget deficit, not reduces it (at least in that way in which it is being implemented now).
Actually the factors inhibiting birth rate are well known, but the actions to take are not something states wants to take. In Europe you cannot even talk about it, usually, unless you talk to younger family members and ask them why they don't want kids at or or just 1 or 2 max. There are economic, education and legal aspects that are clear for anyone that looked not farther than 50 years ago when having 3-4 kids was not exceptional.
Everyone knows. Stop contraception, stop woman education, stop abortions, reduce woman rights to 1800. Remove children rights, make environment where children are productive and bring profits to their parents, so they have financial incentive to create children.
Right, if anyone here has taken a human geography course this is the obvious answer. This is why birthrate was so high for so long. As nations developed and gained rights for women, it went lower and lower and lower.
And it makes complete sense. The reality is having a child kind of sucks for a woman, and I, nor anyone else, can blame a large portion of women for just saying "eh... no". I would probably say no, too, although it's hard to tell, because I'm not a woman.
Having children was once a boon, because conditions were shit. Now it's a burden. So, people will treat it as a burden.
Either make it less burdensome or revert women. Nobody wants to do the latter, so we must do the former. We have to invest in children, because children are a Nation's investment.
Not having to work as much to live seems like a decent way to increase birthrates. Having kids is/would be much easier if parents were at home more often and able to care for kids instead of contracting out childcare to daycare centers because you cannot afford to not have both parents working full time. But it comes at the cost of not growing as fast and being less attractive to capital investors/owners who are reaping by far the highest percentage of profits currently.
The elephant in the room that is getting some attention is demographic collapse. It’s been politicized, unfortunately, and seized on by strange people, but the fact remains that we’ve stuck our heads in the sand here. The seriousness of demographic collapse cannot be overstated. Social and economic collapse are inevitable unless something (morally licit, of course) is done to boost birth rates to above replacement rates, or kept at replacement levels. Once we reach a point of no return, it will be impossible to reverse course.
There’s a lot working against healthy demographics. We have decades of alarmist, misanthropic, Malthusian propaganda from types like Paul Ehrlich. We have now a hyperindividualistic culture - politically, socially, and economically - that is hostile both functionally as well as in sentiment toward the healthy function of family, and secondarily the community life it produces, as well as mental health). The logic of consumerism does not sit well with family life, because family life is not something that can be monetized. Consumerism relies on maximizing spending of the atomized individual, and in order for that to work, one must maximize the work done by that individual. Family life interferes with the regime of constant spending and the reign of total work. (Ironically, this makes the celebrated careerism of feminism an expression of this all consuming capitalist drive. It stigmatizes motherhood with demeaning labels like “stay-at-home mom” and celebrates the very office jobs that are the stuff of comedies.) Today, we understand everything with reference to the individual, even anachronistically reinterpreting history according to its alienating categories. Some governments have enacted pro-natalist policies, but they’re typically weak, superficial, and ineffective. We’re addicted to patterns of life formed over the last 70 years that we don’t want to let go of. Governments need to take much more serious measures that drastically favor, prioritize, and protect the family, through and through. Good luck doing that in our democratic societies. Addicts typically change only after they’ve experienced a crisis and hit rock bottom, and by then, it may be too late.
Immigration, of course, is no solution. The belief that immigration can fix the problem is itself rooted in the logic of hyperindividualism, where atomized individuals can be replaced by other atomized individuals to achieve net conservation or even gain according to the numbers. Cultural realities are totally ignored. The rate of immigration that a country can successfully absorb is not enough to outpace demographic decline. Exceeding that rate undermines the whole point of using immigration to compensate for demographic decline in the first place, since mass migrations are always harmful to host populations. You’re basically talking the collapse of the host populace and the formation of new ones in its place. Furthermore, immigration drains the populations of other countries, ones that are likely also facing demographic issues, which basically makes richer countries parasitic and callous about the continuity and futures of other peoples, until there are no more populations to drain of people anymore.
- increase productivity more than how much the workforce/receivers grow.
And if AI/robots eventually deliver, we're soon going to need a discussion about lowering the retirement age to 55 or even 50 if we don't want 30% unemployment anyway.
When people refer to “raise taxes” they usually talk about raising the rates, but you don't need to raise rates, if the GDP increase then the amount collected through taxes increases even if you don't change the rate.
And as such, it feels like labelling that “raise taxes” is disingenuous.
I'd you really wanted to fit this square peg into your artificial triangle hole, I'd argue that in practice this is closer to “lowering benefits” than to “raise taxes” since the purchasing power of the retired would decline compare to the population average.
But again, there's no basis to chose just your three items in particular.
Automation and increased productivity can also lower the cost of necessities such as food and health care, meaning retired people could theoretically get by with less.
Productivity has already increased several times over while the working age population has decreased. Working the young population into extermination is the current paradigm and is giving the current results, which is all according to plan.
This is the real demographic death trap, and why Taiwan and South Korea are probably past the point of no return.
If one generation has a fertility rate of 1 child per woman, the next must have 4 children per woman to undo the demographic change.
The people in the “corrective” generation must support their own two elderly parents plus four of their own children. It becomes practically impossible.
> The people in the “corrective” generation must support their own two elderly parents plus four of their own children. It becomes practically impossible.
The country and the individual has the same problem. But it also goes a generation further.
There was a link on HN recently which I can’t find. It discussed how we are in an unusual time, where kids can often meet their great grandparents. Previously people died younger, so couldn’t. Now people are having kids at an age where it will be unlikely for them to meet their great grandchildren.
I'm not sure that's true - people died younger, sure, but they also had kids much earlier. Even assuming 18 for first child(and it often was earlier than 18), you'd be a great grandparent at the age of 54 - and people have commonly lived that long even in antiquity.
"While the most common age of death in adulthood among modern hunter-gatherers (often taken as a guide to the likely most favourable Paleolithic demographic experience) is estimated to average 72 years,[169] the number dying at that age is dwarfed by those (over a fifth of all infants) dying in the first year of life, and only around a quarter usually survive to the higher age."
Yeah, I don’t know why people actually believe everyone died at 40 clearly that that’s not true. You’ve met a 40-year-old, right?
Here’s a popular one include all the abortions as deaths and you’ll see that the average age that we live now is also 40
Getting to a fertility rate of 2.1 will at least mean the problem will end at some point and the population will be stable, altough it will take the better half of a century.
This is a nice explanation from Kurzgesagt showing precisely why South Korea is completely screwed long term, and why it's impossible to course correct through birth rate alone:
But that’s not an example of a solution - the birth rate is driven by orthodox citizens who don’t participate in mainstream society, so they aren’t going to pay taxes or care for the elderly (outside their own family).
Yeah it’s a pessimistic data point because it’s challenging to replicate Israel’s unique circumstances and also it’s not clear this solution is even good for Israel.
US economic aid to Israel ended in 2007 (18 years ago).
The US since then only provides Israel with military aid (most of which is only allowed to be spent buying US-made goods). It’s more of a subsidy for the US military-industrial complex.
Also despite the military aid Israel still spends a much greater share of GDP on its military than most or all other developed countries (so the US isn't subsidising Israel’s unusually high birth rate).
And how does this explain Israel's abnormal birth rate (what ImHereToVote suggested in the parent comment)? I claim it's unrelated and is mostly to do with cultural and religious norms.
If the US starts sending proportional military aid to South Korea (fertility rate of 0.75 vs Israel's 2.83) it will not "fix it".
I agree my reply was flippant because I was annoyed by the original comment, and I apologise for that.
The US provides and provided a ton of assistance to Israel but there’s a tendency online for people (probably mostly Americans?) to assign credit to literally everything that happens in Israel to US aid.
Israel exists outside of US-Israel politics and not everything (like birthrates) that happens there is because of the US. The US also supported/aided a lot of other countries that didn’t experience the same economic/industrial/technological development that Israel has in the last 30-40 years - some of it really is because of Israelis’ efforts and not just because of Americans’.
> US economic aid to Israel ended in 2007 (18 years ago).
The US since then only provides Israel with military aid (most of which is only allowed to be spent buying US-made goods).
The Amish have the means because their means are not measured in normal dollar amounts. Most of what they have is traded and transacted outside of the dollar economy.
In fact, they may majority be of subsistence in which case the entire dollar value of all of their stuff is simply the land.
You can solve the means problem by making everyone wealthier or by lowering everyone's expectations. The problem is that "how much it costs to raise children" is dependent on your environment. One group's normal is another's neglectful parenting.
The catch-22 is that the people you presumably want to be having more children— educated working professionals— have some of the highest social standards for child rearing.
Typically EU countries implement the 3 options together - option 1. btw is meant to make the pension irrelevant. It can't happen from one day to the next, but there is a shift happening where people contribute more and more towards private pension funds. It's easy to see that at some point, there will be the equivalent of the US 401K in Europe.
> It's easy to see that at some point, there will be the equivalent of the US 401K in Europe.
* In some European countries. Many countries, however, have no meaningful avenues whatsoever for tax efficient pension saving. My own "pension fund" is just a regular broker account where I invest after income taxes, and where I have to pay capital gains as usual.
Isn't it essentially a thanks/appreciation for what the people built once they retire ? Without theire work, there would be nothing for the younger people to use and benefit from.
Would not be very motivational if you work hard your whole life and then you are considered a useless burden once you retire.
So have younger people too, just their life has not been as long (yet).
The way it usually works is taxation from the current working generation pays for the current retirees. You are not paying into your own account for later (that is a private pension)
FWIW in the UK there are more children in poverty (so their parents too) than retirees who are in poverty. Kids don't vote though...
IMHO it's a matter of basic justice. If you're forced to pay an amount for pension funds that you cannot even chose and have no control over for your whole work life, then you better should get a an adequate pension when it's time. As for the example from the UK (not comparable to Denmark), I don't see why someone who worked their ass off their whole life should be poor because some parents are too poor to have children. That seems to be a different problem.
What's annoying about these debates is that the people who'd e.g. like to see pension cuts are either young and will change their mind later, or they are so rich that none of this matters to them anyway and the latter shouldn't even have a voice in this debate.
> I don't see why someone who worked their ass off their whole life should be poor because some parents are too poor to have children.
The issue is the "triple lock" (state pension rises by whichever is higher of either rate of inflation, average earnings increases, or 2.5%).
While laudable in intent, recently this has led to situations where pensioners are getting bumper increases linked to high inflation, while the younger working age people are getting stagnant wages while inflation shoots up.
This is is why pensioners are on average getting wealthier than the working population. Let that settle in for a moment: year after year pensioners are getting more wealthy than the working population that is financing the pensioner's increase in wealth.
This is universally accepted as unsustainable and deeply unfair on an intergenerational basis as the pensioners - who generally tend to own their own homes and also get various benefits like free transport and extra money for heating costs etc as well as benefiting from more generous policies/working conditions of the past like free university education and final-salary private pensions or purchasing government-built social housing at steeply-discounted rates, lower tax burden - continue to get more and more well-off while the people financing their retirement are struggling with soaring costs, expensive childcare, high education costs, zero-hour contracts, stagnant wages and all the rest.
Yet pensioners complain that they paid their taxes "all their lives" so they deserve to continue getting a bigger and bigger slice of the pie, that they deserve to get wealthier and wealthier than the working population, all at the cost of pushing more children below the poverty line and financially crippling the current workers who have also paid their taxes all their lives (so far).
Eventually with policies like these, you run out of other people's money.
Trouble is that it is a political landmine since pensioners are a big part of the vote so no one has the balls to abolish (or at least reform) the triple lock.
It's not a choice. You're forced to pay for the pension system in Denmark and most other countries if you're employed. The only thing governments have to do is to use that money for actual pension funds instead of embezzling it, and to calculate the contributions on a reasonable basis with reasonable extrapolations about inflation, i.e., to properly finance these funds now and not abuse them for other purposes.
It's mysterious why they haven't done that despite the fact that the demographic problems were known to occur up to 40 years ago. But you see the same thing with housing prices and rents, forthcoming problems were already obvious 20 years ago in every country, yet only few have tried to deal with them in time. Maybe someone else can explain where this inertia comes from, I always found it strange.
And capital gains are actually property taken from the workers and given to capitalists. In both cases, the recipients have magic tokens that legally entitle them to some of the value created by other people.
I don't know how this works in other countries. In Finland, it was established decades ago that pensions based on past contributions are constitutionally protected private property. Because people made explicit pension contributions and because the government promised that the future pension would be based on the individual contributions, the government can't alter the deal substantially without a constitutional amendment. If the contributions had been general taxes, or if the promised pension had been independent of the actual contributions, ordinary legislative process would have been enough.
US annual deficit/debt is a meaningless number since it just prints as much money as it needs being the world reserve currency. It's a looney toons number.
This really isn't true. I am not deficit doomer, but you can't say its meaningless. The US paid $881 billion on interest on its debt last year. This is on par with the DoD. Yes, it's still only around a tenth of the US's total budget, but it is not hard to imagine the debt going up by 10 times. With the same interest rates, we then the US will pay as much in interest as the rest of the budget combined. If the US just needs to "print as much money as it needs", there is a certain point at which it will become hyperinflationary.
It's worth noting that it pays that interest back to itself. The risk of becoming hyperinflationary is real, but US can continue ignoring the problem pretty much indefinitely as long as other countries do their trading in US dollar.
My grandpa went to prison (in Romania) in the 1950-es for being part of bourgeoise class because he fixed and ran a broken mill. He was a war refugee (from Romania to Romania) without any money, land or any other resources, but in Communist Romania running a mill would tag you as "super rich". I guess this is what you wanted to say there, correct?
I consider myself reasonably well-off but am unlikely to become even a millionaire in my life (inflation-adjusted). I’d say millionaire = rich, 10-20 million or more = super rich. See also https://en.wikipedia.org/wiki/High-net-worth_individual.
If we assume the wealthy own the stock market, it’s $52 trillion - enough to pay off the debt and leave $16 trillion left over - which would cover about ten years (assuming the debt service has been removed by the payoff).
Whether nationalizing the entire US market would be worth it is left to the reader.
The top 1% pay like 25% of all taxes. If we want to increase tax revenue 25%, we can just double the taxes on the top 1%. This might cause some of the top 1% to suffer the extreme suffering of being in the top 2%.
>The top 1% pay like 25% of all taxes. If we want to increase tax revenue 25%, we can just double the taxes on the top 1%.
Just look at the countries that have already done this. What share of taxes does their top 1% pay, and does that consistent with your model? Or does the reality show exactly the opposite result?
Not everyone sits on a bazillion tons of natural gas and oil. Also, there are 5.5 million people in Norway. Though, Denmark is almost the same population, they have no bazillion tons of oil and natural gas. See the problem?
That omits the essential fact that economies tend to grow - quite a bit over your lifetime. 2% compounded annual growth over 50 years will result in the economy being 2.7x its starting size.
Economic growth in the abstract doesn't help much, because a retiree is only on the consumer side of the equation. 2% compounded annual growth over 50 years will result in the average worker consuming a lot more stuff, and they're not going to be happy if they have to throw that all out and embrace a 1970s-era standard of living when they retire.
And established elsewhere is this post, people apparently don't want to live like we did 50 years ago, so economic growth has merely been translated into inflated expectations.
The social pension system always was a Ponzi scheme where the ones who got in first(boomers) get the biggest share of the pie(10-20 years of life left after retirement), while those coming into the system last(millennials+) and pay for the current retirees will get rug-pulled(5-10 years of life left after retirement).
Sustainable population and economic growth at that rate can't happen indefinitely.
Some people have been vocally saying this system in unsustainable long term, just that Europeans governments never wanted to publicly admit this due to fears of loosing elections, so they kept kicking the can down the road.
The boomers definitely weren’t the first getting in, the original pensions were paid to their own parents
It’s not really a Ponzi scheme, it is completely possible for the system to be balanced, it’s just very very hard to get people to vote for you if you say they’ll have less tomorrow
> It’s not really a Ponzi scheme, it is completely possible for the system to be balanced, it’s just very very hard to get people to vote for you if you say they’ll have less tomorrow
This is exactly what happens in Denmark - a balancing of the pension system.
Also,rgis has been planned since 2006 - so it is nothing new.
A real balancing would entail cutting pensions for existing pensioners. Which is electoral suicide. So what you always end up doing is shafting future pensioners, either by pushing back the retirement age, or by doing nothing and waiting for it to explode
Also, that people who have twenty years to plan for their retirement to happen under these conditions will not be as screwed as someone told that their plans for next week are off.
But those people retiring from 2040 are still getting screwed by a policy. How is more time to prepare gonna help? Are you gonna magic some more money out of thin air by then?
maybe you don't like it to be called a Ponzi scheme, but the reality is that it is one.
Definition of a Ponzi scheme: A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investor. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk. But in many Ponzi schemes, the fraudsters do not invest the money. Instead, they use it to pay those who invested earlier and may keep some for themselves.
That's exactly how pensions work in Europe. Replace "Ponzi scheme organizers" by "legally elected governments" and here you have it - you have a whole continent of people believing that their pension is a given. Not everybody may like it, but that's the hard truth.
In the US, people contribute towards a 401K, and choose how to invest, but typically pick up just the S&P 500 - anyway and at least that money is somehow what they have saved for themselves.
But I agree with your statement "it is completely possible for the system to be balanced" - yes a Ponzi scheme can be absolutely balanced, you just need enough participants ...
i disagree. this is not at all a ponzi scheme. as you have pointed out the ponzi scheme has no value outside of the system and relies on deception to convince people to buy in to it. crucially the investment scheme provides no "value".
pensions on the other hand don't have the quality of deception and the value is straightforward - it redistributes wealth from the younger population to the older ones. this reduces the need for individuals to plan their retirements as the state takes care of it. as pointed by another post, you don't need a pyramid here, just somewhat equal proportions of population on each side.
wouldn't you characterise any tax scheme as a ponzi scheme? unemployment benefits, healthcare etc? what makes them different from pensions?
but i do agree that one should not think of pensions as a given. its worth pointing out that there are two types of pensions - defined benefits and defined contributions.
> wouldn't you characterise any tax scheme as a ponzi scheme?
No, not exactly, that's different.
> unemployment benefits, healthcare etc? what makes them different from pensions?
That's certainly contributions I don't like either, because of how this system is abused. But to be fair, unemployment benefits or healthcare aren't a pyramid scheme, because you aren't paying for the previous "investors" - you might get back what you contributed (with a lots of caveats). In the case of the pension system, you clearly pay the previous "investors".
It's not a fraud. How can you say so? Also, the first pensioners didn't invest in the system. There isn't even a concept of investment in old-age social welfare, unlike other pensions. It's also not a pyramid scheme, since the structure is upside down, and there is no recruitment.
Calling it something else than it is, only to taint the system and its receivers by associating it with a criminal undertaking is bad faith, if not worse.
I just quoted the definition of a Ponzi scheme, hence the word "fraud". The definition of a fraud is "... fraud is intentional deception ... to gain from a victim ... unfairly" https://en.wikipedia.org/wiki/Fraud - maybe this gives another perspective what a fraud can be?..
> the first pensioners didn't invest in the system
I agree with you .. I suppose you're making my point here?
> It's also not a pyramid scheme, since the structure is upside down
The structure would be upside down if the demography was growing as expected - and that's the core of the issue, why governments have to extend the age of the retirement: the burden of the pensions is becoming unbearable relative to the amount of active people.
> there is no recruitment.
No indeed, though if you decide to live in Denmark, you are not recruited, you're forcefully enrolled in this scheme.
> ... to taint ... its receivers by associating it with a criminal undertaking is bad faith
There is no "criminal undertaking" here, the system is simply broken and you're saying things I didn't - I certainly don't blame the current pensioners, nor the active generation working for these pensioners - they are all victims of this system.
My boomer parents are already pushing being retired for 20 years, neither did anything more than the bare minimum in life.
They could have easily worked 10 years longer instead of doing nothing but drinking wine all day and/or going out to restaurants in retirement. That is in between traveling to go out to restaurants and/or drink wine.
The boomers scammed us all and aren't done yet. They are going to make sure to bankrupt the entire system with healthcare cost before they go.
yes. life expectancy going up is a good thing - it means people can keep working even when they are older. but fewer young people is not a desirable outcome, some of the pension funds could be redirected to more benefits for child care etc.
While some can continue to work longer, most adults I’ve known simply can’t work, at least in their chosen field, much past 67. Physical pain and loss of mental acuity take their toll. Pushing the retirement age out to 70 might prevent the whole system from collapsing but we need to make sure younger people save with the understanding that working until age 70 might simply not be possible.
Living longer doesn’t necessarily mean having more productive years than in the past. We simply have the medical tools to keep people alive even if they can’t much get out of bed.
If pensions were funded by actual retirement accounts, where employees invested money into some state fund and have it paid out for retirement this would be entirely unproblematic.
But the pension system in many EU countries is set up in a way in which tax contributions now finance pensions now. This can only work with a steadily growing economy which continually generates more revenue when more people retire. In some sense it is a literal Pyramid scheme, in which the obligations are continually pushed to younger generations, which have to contribute based on how many pensioners there are.
Especially now as EU economies become weaker this issue becomes bigger and bigger.
Fundamentally any retirement plan that doesn't involve canned food in a celler is pay-go because the retirees will be consuming resources from the economy they retired into rather than the one they were workers in.
Their retirement savings can be in public company stocks instead of government guarantees but that only works if there are people willing to buy those stocks (ex: younger people saving for retirement).
That's only true if the economy doesn't grow i.e. productivity doesn't improve. If retirements are funded from returns on assets they scale with productivity. If they're funded by current workers they're bounded by the limits of population and wage growth.
There is a production side of the equation but also a demand side. Through robotics and AI, Toyota might get really good at making cars really fast with minimal human labor. But if the demand for cars drops every year, the value of Toyota will be like a melting ice cube. This will be true for all stocks actually, (except perhaps the firms that sell adult diapers) but not only stocks, but property as well. And probably bonds. Do we really think Japan is good for their 2060 bonds, assuming no debasement?
In a world with forever imploding consumer aggregate demand, there is no safe asset.
It breaks down if you think about individual firms like Toyota. But the macro picture is that humans are consuming less goods and services and due to that consumer demand drops. And that means the non-working population's needs can still be fulfilled by the proportionately-smaller working population.
Asset prices are just numbers. A retirement fund that invests in broad-based stock and bond indices will have returns that track the productivity of the entire economy. If the economy is producing more it means people are consuming more. If it produces less, people are consuming less. It balances out.
An extremely productive economy with 1/5 the number of consumers (and dropping) will have a cheaper stock index, even with improved productivity. Asset prices over the long-term are driven by cashflows. Hollowing out revenue while improving productivity still results in a lower asset price because your cashflows are smaller.
Productivity gains will also be swimming against the stream because scale advantage will deteriorate in all sectors.
Exactly. A world where aggregate consumer demand shrinks year after year is a world where all asset prices slide forever. Retirement is simply not possible on any large scale.
No, fundamentally it doesn't really matter. Retired people consume but don't produce. They are fed by the economy of today, not by economy of the past.
Whatever you accumulate for retirement (cash, stocks, gold, state pension points) it only represents coupons for your share of the economy of the future. Details may differ but fundamentals are the same: it a promise that the future generation will share some of their yield with you.
Retirement migration will be common in the future, either to lower-cost parts of the country or to different countries altogether. It's happening right now with Spain or Florida, but it will get even more common.
> If pensions were funded by actual retirement accounts, where employees invested money into some state fund and have it paid out for retirement this would be entirely unproblematic.
You're talking about a system of pension by capitalization, like in US, which comes with its own problems.
Namely that if you reach retirement age during a crash like in 2008, you're screwed. You have to work 5 more years hoping the market recovers in the meantime, or retire anyway and get way less than you put in.
But people are living longer, in better health (I think but didn’t verify with data) and entering the workforce later (due to more secondary schooling).
Setting aside the issues of declining birth rate for a minute, this seems like a reasonable adjustment to the other factors?
There was a steady rise in life expectancy at retirement age in the UK until 2020, then something happened and it's fallen significantly. My guess is that it will rise rapidly over the next 15 years and this will be regarded as some sort of triumph for the public health system (unless there is another pandemic of course).
I didnt have time to write a whole treatise. Yes women’s was brought in line with men’s. I should have said, men’s retirement age has not gone up but said retirement age bc it’s an HN comment, not a published paper.
The raise to 68 will happen, but it has not happened yet. So, I think to frame my comment as “simply untrue” is disingenuous at best.
The metric of “living longer” isn’t the same as “life expectancy once you reach the age of 65”, for example. In the US, when someone cites a statistic that our average life span decreased, it’s due to the effects of early-life mortality on the mean. If you make it past 65, it’s a different statistic.
Take on and service more debt (e.g. larger mortgages). The productivity gains are claimed by creditors (i.e. those with existing capital). At least, that's a possible explanation.
Personally, I'm not sure that they are living in better health in the way that I care about. I.e. my goal is to retire when I'm still healthy enough to do things (i.e. travel). Although they are likely healthier than previous generations, most of the 70 years olds I see still aren't healthy enough to travel.
The policy for retirement age is related to when society sees fit to sustain someone that does not work. I think it has more to do with how the society sees the elders and what it can afford than to the goals of specific individuals.
I had a great grandparent live to 102. 3 of my 4 grandparents lived into their late 80s with the oldest passing a month shy of 90. Even my grandparent who smoked 2 packs of cigarettes a day lived to 78. For all of them, their last good year was about year 80.
My dad just turned 78 and has really slowed the last 5 years. Longer life says little about quality of life.
why wait for travel until you are retired? Retirement should not be "the" goal in life.
I've been traveling for holidays every year since I was 25 for at least 3 weeks every year, loving it so much. First it was backpacking, now it transitioned into a bit more luxury as I got older.
You don't know if you'll be hit by a bus next year, retirement is a silly milestone to focus on.
True but no matter how healthy one is in their 60s and 70s people's health degrade significantly in their 80s. So, you have then 10 year of healthy life after retirement.
There's the flip side if the coin though: old people are healthier in Denmark (vs US for example [1]) due to the social welfare system. Well, that system needs to be funded. With the aging population, the costs are rising but contributions are (relatively) declining. That's why there's a push for higher retirement age. It's either this, or defunding the social welfare programs, or immigration. That last one isn't a viable political option in Denmark at the moment.
I think what's happening though is that current generations are taking it easier in a lot of ways as a result of having to work more. For example, avoiding senior promotions into management etc.
The first pension was put in place by Bismark as a way to "steal the clothes of the socialists whilst they were bathing". It was seen as the cheapest social benefit because life expectancies were so low. A popular policy delivered at low cost to the state.
That people are living longer is why the system is failing. It's an interesting thought experiment to consider whether any country would introduce a state pension now knowing how much they cost.
I'm in the US, but I'd be happy if social security ages were pushed out to 75 or 80 but benefits preserved.
I'm saving heavily for retirement, but the biggest challenge is figuring out how long you're going to live. If you have sort of a defined and horizon, it's much easier to calculate.
Yeah, probably 90 here in the EU is a good cut off. People I know seem to make 80 quite easily, but at 85 it goes down quite a bit and after that even the best seem to be done. For me that's 35 years ago at least but I am planning to not get to 90 and if I do, I won't be interested (or know it) anyway.
Of course it failed when it was created in completely different circumstances.
Or some may say it got outdated.
It was started at times when the life expentancy was low. And it was given at age above the life expentancy. And in the beginning not to everyone. The retirement age got lower and given to broader set of population gradually. These moves made governments popular, so it was no brainer to introduce, on the expense of future generations.
Birth rates that can maintain the economics of relatively low retirement age could not be sustained without destroying the planet. Actually has to be reversed still as it went too far already and deteriorating as we speak, especialy with the ongoing large increase in the overall life quality - causing decreasing birth rate alone - and healt. The system was destined to fail. But how to take away rights? It is much harder than giving, especiallly when the adverse effects are for current voters, not future generations?
So the necessary steps are postponed, postponed, postponed yet again, for many decades, taking about necessity in many forms, meanwhile filling bigger and bigger holes in the budgets, through borrowing, making the problem worse, again for future generations. Very few countries do tiny adjustments, and even those are met with huge protests mostly.
I wonder what the future holds. Painful adjustments or more painful collapse later in some form.
No it isn't because of their birth rate, or at least, birth rates are an issue orthogonal to it.
In some rich countries people spend now more years of their life out of work than in work because of much longer education and much longer lifespans. If you want to keep the same social standards, all other things being equal, you need to raise the retirement age.
It's not that you are expected to work that long. It is a case of not being expected to work longer than that. You are always welcome to retire earlier if you have the financial means to do so. You are also welcome to work longer than that should you have the desire to do so.
Of course, those last two sentences are tongue in cheek.
The real problem is that certain segments of society are not compensated for their labor at a rate that would allow them to retire early, and may even have to work beyond retirement age in order to supplement their stipend. Worse yet, these people often work in sectors that offer few affordances for them to maintain their health into old age and may even push them into living conditions that are detrimental to their health (assuming their job isn't detrimental to their health in the first place).
Ideally, people would be able to retire when they want (within reason). The reality is that some people can retire at a relatively young age while others don't really have that option.
The system has effectively failed most everywhere on the West. The post-WWII generations are numerous and have a long life expectancy, apparently longer than the pension systems planned for. Generations that came after them are less numerous, and, in a way, somehow less prosperous. They cannot pay enough to keep the pension systems afloat.
The Japanese faced this earlier and harder than Europe, with about 30% of their population being past the retirement age. They increased their productivity very significantly, but it's still not enough, and a lot of older folks in Japan keep working well past the retirement age, sometimes even re-hired by the companies from which they had retired.
It'll keep getting worse, as more and more people concentrate into large cities. And large cities are family-hostile. The birth rate in cities is strongly anti-correlated with the city size. People just don't feel content and happy to have children in dense cities.
Japan is very illustrative in this regard. Young people are forced into unaffordable cities, where they often live in cramped shoebox-sized apartments. While beautiful spacious traditional homes are decaying just 2 hours away by car.
What can help? Promote smaller cities, by focusing on making smaller cities more attractive for employers. This is already happening with the remote work, and it helps: https://eig.org/families-exodus/
How to make smaller cities more attractive? Put a stop to densification of larger cities, and tax (or cap-and-trade) the office space in dense areas.
Well in my country all the land is owned, either by the crown or by land owners, so at least in my country, the government would have to just...give away land? (Canada, The West)
To build a house and live sustainably it needs to be somewhat near other community surly? For access to grocery, education and health care, and then also modern opportunities. Barrie is probably the most reasonable area outside of Toronto and land out there is still very expensive. How do you see it working for someone who just graduated from college and has $200k in student debt? I know a lot of people who are stuck, I don't know the solution. If I was them and society wanted me to have a kid for the good of society, I'd say sure, give me a house and $3MM, other wise, why bother...?? Nobody wants to continue this miserable cycle.
Of course, building a new community from scratch is hard and is probably not worth it. But there are plenty of small cities that can act as "seeds".
Barrie is still in the general Toronto area, so it's expensive. Sudbury further north that is definitely not a part of Toronto anymore, has very reasonable houses for ~$400k, or 5 years of average household income in Ontario. This is well within the normal "affordable" range, so a 20-years mortgage will be around 30% of income.
The problem is, people _can't_ live in Sudbury because there are no jobs there!
My plan at some point is to do a big tech start-up in Winnipeg. Bit of other stuff still to do first, but I have an eye on Winnipeg (good flight times!!)
This is a very sensible comment. One thing that could explain why I see (subjectively) a lot more bigger families in Switzerland where I live compared to other places in Europe is that cities‘ size is „just right“, so having a family to start with is much easier than in large, urban areas.
But the current drop below the replacement rate is all due to increased density. If you look at the stats, the urbanization percent stayed flat. However, more and more people are moving into a smaller and smaller set of large cities.
> People just don't feel content and happy to have children in dense cities.
Correlation is not causation. People happily raised children in dense cities for centuries. It was only when the postwar regime of making new housing illegal took hold, and housing prices inevitably spiralled out of control, that they stopped.
> Young people are forced into unaffordable cities, where they often live in cramped shoebox-sized apartments. While beautiful spacious traditional homes are decaying just 2 hours away by car.
Those old houses look great in instagram photos but they're not very fun to actually live in. Young people are rightly prioritising places that are good to live instead of the boomer square feet fetish.
> Put a stop to densification of larger cities, and tax (or cap-and-trade) the office space in dense areas.
Killing the most economically productive parts of the country is not going to magically make other parts more productive, it's just going to destroy the whole country's economy.
The causes of the population decline are a) women marrying later, or not marrying at all, because they have the option of a career and prefer that b) families that want to give their children a good future having few children, mainly because of the cost of education. Those are the things you need to address if you want to change it.
> Correlation is not causation. People happily raised children in dense cities for centuries.
London is an example of such a city. Its population in 1750 was 750000 people. It was not a "large city" at all by current standards.
> Those old houses look great in instagram photos but they're not very fun to actually live in.
Oh, I agree. However, for the price of an apartment in Tokyo, you can build a _new_ home with all the modern amenities.
> Young people are rightly prioritising places that are good to live instead of the boomer square feet fetish.
Yeah, like "microapartments" where you can cook food while sitting on a toilet. Very well suited for hikikomori, great for raising 3 children!
> Killing the most economically productive parts of the country is not going to magically make other parts more productive, it's just going to destroy the whole country's economy.
It won't kill anything, it will just move jobs out of large cities. We've already had a "dry run" of this during the pandemic.
> amilies that want to give their children a good future having few children, mainly because of the cost of education.
Europe has free (or cheap) education. Yet birth rates are even lower than in the US.
> Those are the things you need to address if you want to change it.
Then why people moving out of cities have a greater fertility rate?
> London is an example of such a city. Its population in 1750 was 750000 people
And its population in the 1930s, with a healthy fertility rate, was 11 million.
> for the price of an apartment in Tokyo, you can build a _new_ home with all the modern amenities.
Maybe - bear in mind that building costs are much higher out in the country. But assuming you build a big house, what would you do with it? I guess all the cleaning will help make life less boring.
> It won't kill anything, it will just move jobs out of large cities. We've already had a "dry run" of this during the pandemic.
The pandemic did a lot of economic damage, and many jobs stayed in the cities or are rushing to return there now.
> Europe has free (or cheap) education.
But much stronger womens' rights and correspondingly low marriage rates.
> Then why people moving out of cities have a greater fertility rate?
In Japan? Maybe because of all the cash subsidies for moving out with children.
> Those old houses look great in instagram photos but they're not very fun to actually live in. Young people are rightly prioritising places that are good to live instead of the boomer square feet fetish.
How practical is raising kids in a 20m2 studio? Especially if you've got multiple. I'd bet not nearly as practical as in a house. Plus the recent trend of building lots of smaller apartments instead of a bit bigger and way more practical ones.
20 is maybe going too far, but a bigger space is often just harder to keep clean, especially with kids. Of course if you're raising kids in a city apartment you'll want them spending a lot of time out of the house (whether that's parks, community centers, just shopping, ...) but that's a good healthy practice anyway.
How do you know that this is separated from other factors, like woman being more educated and have more access to birth control in urban area ? How can we be sure that housing size is the single deciding factor as you said ?
To tell you the truth I only ever see poor people (immigrants, mostly) that carry around like 3-4 kids in cities (I am in SF) while everyone else either has 1 or no kids.
They don’t speak English and I’m not sure if they will assimilate well. I already see street vendors, trash everywhere, and other 3rd world behavior in some parts of SF.
I’m an immigrant from 3rd world. It’s pretty sad to see here.
I feel, generally, with an aging population + rising unemployment due to AI, we'll reach a crunch point that puts governments under immense pressure to increase taxes (probably on megacorps & the wealthy) more in order to fund welfare. The most optimistic, utopian, solution would be UBI and an artisan economy, but I think we all know that capitalism isn't kind enough for that to play out so we'll probably end up with something much more dystopian.
> we'll reach a crunch point that puts governments under immense pressure to increase taxes (probably on megacorps & the wealthy) more in order to fund welfare.
I don't see how even that helps. What you need to fund basic welfare is a large supply of basic goods (shelter, food, medical care). The basic problem with retirement of a lager generation than subsequent generations is a lack of labor/productivity. Those basic goods don't really respond well to just throwing money from tech companies/rich people at the problem, you need people to work to provide those goods and services.
The only way taxes help is if they discourage "unproductive" economic activity (SWEs and financial planners) so much that those people start working as nurses and construction workers instead.
The spend like crazy on nothing, cruises, trinkets and inflated healthcare. All that spending yields nothing of substance except for experienced and critical doctors.
Higher life expectancy more like, the state can't afford for people to spend 20 years unproductive. This is a much less acute issue in the USA and Russia where health is poor and life expectancy low.
It is simple mathematics. European pension systems are not a saving system, but a pay as you go system, where pensions are paid from the people who work now. What you get in taxes this month you pay as pensions this month, as a state. This is the Bismarck model and it was invented at a time when the average lifespan was lower than the pension age, so many people were contributing very little as a percentage for very few people to get pensions. Today the situation is the opposite, with less and less people paying (not too many people start working at 16 years like in 1860), retirement age was lowered in most countries, the percentage of salary you pay as pension tax can be 25%, growing that is not too easy as this is just part of the taxes workers pay.
This system was working back in 1860, but it is a Ponzi scheme in decline for the past 50 years. And there is no way out, most people rely on state pensions to live after retirement; it is the perfect trap.
Maybe the system needs a rethink; an expectation that everyone able to will pretty much work their whole lives, but making work much less miserable and time-consuming so that's just fine.
Ha. Total pipedream. It is easier to imagine the end of the world than to imagine the end of our current economic system.
How would you fix it? Note that even Scandinavian nations with very generous healthcare and childcare policies can't raise their rates, it simply seems that as people get wealthier, they have fewer kids, regardless of the status of their country's systems.
My take is that saying the problem is birth rates is misguided. Surely we have enough labor to provide for the elderly, why can’t our economy be structured to get this labor to the people who need it?
Do we have enough labor? At least in the US there has been a shortage of elderly care workers. And even if we didn't, what does it mean, concretely, to structure the economy to get the labor to those who mean it?
> least in the US there has been a shortage of elderly care workers
Well yeah, because it's difficult, taxing, often traumatic work that pays the same as any other nursing job with a higher QoL and social status. And even then they're pushing out all the actual nursing staff that pays well in favor of MAs/CNAs who get paid like shit.
But at current unemployment rates, raising pay to get more workers into elderly care is just poaching them creating shortages in other places. I always say that the demographic challenges ahead of us are not about a shortage of dollars but about a shortage of humans.
I don’t ever expect everything to be perfectly efficient or even close to it, but how many jobs are there that really truly matter? A job “mattering” is binary either, a doctor is probably essential, and an artist isn’t, but it still matters.
I personally don’t think wages always correspond to how essential a job is, but for the sake of the argument let’s pretend that wages match the necessity of a job, its difficulty, educational requirements, etc.. In this case, I’d expect that we would see people move to jobs that are more essential than their prior job. I think this is more complex that just “poaching”.
Correction to myself, I believe we have more than enough people to provide the labor.
I really don't mean to get into the nitty gritty details - I'm not an economist and I'm not providing solutions, just stating what I see as the problem. I believe that we have enough resources, and there are issues getting those resources to where they need to go.
Example:
Assume we do have a shortage of elderly care workers. Why is this the case? Could this be fixed by increasing their wages? Then that implores the question of who is paying for these increased wages, which is the question I'm not answering and I don't know enough to answer.
I just don't really believe that keeping the birth rates high is the answer to this economic problem. It might be a solution, but it's more of a band-aid than truly facing the issue. If you have a inefficient engine you can either figure out how to produce more gasoline (babies), or you can figure out how to produce a more efficient engine.
The US's problem with healthcare workers isn't because nobody wants to do it, its because of not the great wages for a career that many don't just inherently enjoy doing on top of high educational costs and limited positions for trainees. The not great wages cuts prospective workers, caring for old people in general is not super attractive and cuts potential workers, the limited spots for residency cuts many qualified people who had the drive and intelligence and the money to become healthcare workers, and the high educational costs kills even more potential workers before they even try putting a step into the healthcare industry.
A truthful ad for working in an old folks home in the US would be, "slightly over median wages, but with inflexible and unreliable schedules, rampant industry wide exploitation of workers and their rights, likely multiple ownership changes of your place of business, caring for potentially deranged and violent individuals, high non-refundable monetary investment up-front, no guarantee of residency availability"
Yeah, people keep trying to find a purely economic reason for why folks are having less kids. I think I'm satisfied with the very simple reason that raising kids is hard work. Most people feel like 1 kid already gets their hands full. That's really it IMO. Whenever it was that joint families split up into disparate nuclear families, obviously the load of raising say 5 kids that was being shared among 20 people, suddenly fell on just 2 people.
In the places with high fertility rate, you will almost surely observe joint families. I'm from India where we have such demographic variety that you can see adjacent areas with completely different fertility rates. In one, you will see old-style large houses with courtyards and 15+ people in them living as a joint family. Invariably these people have more kids. But in the next town with more nuclear families and modernish apartments, you will be lucky to see 2 kids per family. [1]
This is what births the secondary economic incentives which are mentioned a lot in popular discourse. For example, if you're already living in a house with 15 people your financial realities will require a similar number of people in the next generation to continue the same lifestyle.
[1] Wealth is not a confounding factor here. The specific two areas I have in mind are both more or less equally wealthy, one has folks running a coconut business primarily and the other is a small town with the usual assortment of office jobs.
Best simple and obvious explanation I’ve seen for the root cause.
So … probably most straightforward solution is to update local zoning laws to encourage a more communal style of living. Not communes but more along the lines of suburbs-as-village.
Having a child has a significant impact on your professional career (women in particular). Even in countries with great parental leave, like Denmark, the absence still reduces the years of experience you would otherwise get. Once they are "ready" for a child, they are in their late 30's and barely have time to birth one or two babies and would probably not have the stamina required to take on more.
The social pressure of raising the perfect kid with multiple activities in their "spare" time is much higher today and require more from the parent.
Ideally, people should get children in their early 20's, when they are physically more fit to handle the pressure. Unfortunately the current education system does not combine well with young parents. The government would need to integrate child care in colleges so that the parents have somewhere to place the children while studying.
It is important to keep in mind how these pension schemes are funded. Already now over 40% of Danish government expenses go towards social security a large part of that is pensions.
With a growing population of pensioners and a declining population of taxpayers many EU countries are walking towards a future where it is abundantly clear that the state can not finance pensions. Especially when at the same time their companies loose their economic competitiveness.
I do not believe that raising the retirement age in 15 years will be of any major help here. And it seems especially outrageous for the younger generation.
It's obvious, that there is no pension in Europe in 20 years anyway. Demographics are super ugly everywhere. Investing individually is the single way, that works if one does not want to retire in under the bridge. Sadly Germany does not help me caring about my retirement taking 18.6% away and heavily taxing the rest.
The math for pensions is fine as long as the maxes payout isn’t excessive and you don’t start too early. There’s a huge cost difference between a 30k/year pension at 70 and a 45k per year pension at 60.
People also focus on a fixed percentage being returned while ignoring the long term increase in productivity and people’s standards of living. In real terms people in 2025 get way more out of pension systems than people did in 1925, that’s as central to the problem as any changes in lifespan.
I will pay more than €600000 for this “retirement insurance” over my entire career. So with 30k/year pension and living under the bridge at 70 I must have superior health to break even at 90 and benefit from the “insurance” afterwards. Ok, it’s not that bad, there is some disability insurance included. Better than nothing.
The value you get is as an inflation and lifespan hedge. There’s no investment built into the system but the money being paid in by younger workers for people who are 100 is adjusted for inflation that year not whatever the currency was worth 75 years ago when they started. Similarly if you die at 55 you don’t benefit from retirement savings either.
Historically payouts also benefited from rising productivity and populations but those assumptions are breaking down.
> I will pay more than €600000 for this “retirement insurance” over my entire career. So with 30k/year pension and living under the bridge at 70 I must have superior health to break even at 90
Let's see. If you pay 15000 euros per year for 40 years, and get 5% interest, that's 1,800,000 euros at retirement. Even if you held that in cash, a 30,000 euro/year withdrawal would last you to 130.
Not sure how your system works but US SS also covers spouses, widows, disabled workers etc which limit the average benefit.
Assuming full employment every year is a mistake. Also, 5% interest above inflation is an unpredictability good return, especially if you’re assuming it’s a safe investment. The stock market has mostly done well over the last century but start in 1969 and the 40 year return on the S&P 500 was 4.2% after inflation. Things could be far worse over the next 40 years, the 20 year S&P returns have been as low as 0.6% over inflation.
Running the numbers assuming zero taxes and fees is a separate issue.
There must be full employment every year with a mortgage. And I will work 6-7 years of my career just for this mandatory insurance. Sounds stupid and absurd when I read what I wrote. The widow might get something from that. But let me invest half of that in stocks and another half in 2 rental apartments and I will do much better that state. Plus it stays in the family after I die.
At an average of say 4% unemployment rate over your lifetime means the average person is unemployed ~1.6 years out of a 40 year working career. That’s not all in one chunk, but any time not spent working is time not funding a pension or retirement account.
In US SS your spouse can collect benefits when you died at 22 if you had a kid together, you also can collect benefits if your disabled. There’s obviously not 1.8 million in your retirement account to fund such things at 22. Similarly the payout for a married couple is 1.5x if only one of them have ever worked because it’s not a requirement account it’s a social security program, and then 75% if the worker dies. No idea how your system works, but it’s common worldwide for pension programs to do such things.
UK-based here and despite it being one of the lowest state pensions in Europe, there are still complaints that it's too high. I fully expect to never receive a State Pension, and so contribute the maximum to my private pension. But even then it wouldn't surprise me if soon even those contributions got taxed too.
I think that the long term consequences of cases of CFS/ME that are induced by Covid (and thus Long Covid) are going to take out a large amount of the top of the population pyramid well before their time, myself included.
The increased medical costs as we go, however, might actually make it worse, faster.
In many EU countries, retirement age increase while the value of the pension itself decreases. It's about demographic of course but it's also the signs of a failed system. People understands this and are contribution more and more towards private funds which are meant to offset the loss - slowly shifting to a US system.
The current system is just not broken but unfair. In many EU countries, people are not contributing for themselves, but for the previous generation being currently retired. In turn, it's supposed that babies born today will work for the pension of the currently active generation. This pension system is nothing else but a pyramide scheme and that scheme is now breaking due to a demographic issue - just like a traditional pyramide scheme would break because there are not enough participants to that scheme ...
No, you're reversing the burden of proof. People who make bold claims need to back them up somehow. If they fail to do so, their posts have no information value and should be downvoted.
The thread was about the work force and in Denmark the vast majority of migrants work. Go look it up on any statistics site, I certainly did but I'm not going to provide you with the link. It's very easy to look up. The Danish government publishes this information.
Industrialized countries unable to accommodate and become appealing to a sufficient yearly inflow of migrants to rejuvenate the work force are doomed. The population statistics are crystal clear about that. That's just how it is. Those countries could have changed their pension systems 30 years ago to avoid this problem but didn't.
Other than that, I don't care what you personally mean by "...are positive" about a whole group of people. Making such statements about hundreds of thousands to millions of people is an obviously gross generalization and not at a level worth discussing.
The problem is, policies are about generalisation. Otherwise we couldn't make any laws at all. It's not realistic to evaluate person-by-person millions of people either. Especially when you take into account that 2nd and 3rd generation immigrants are usually more problematic than parents who actually did immigrate.
„Work“ is not always beneficial-to-society work. Especially if you have a good safety net. Even in my country break-even to pay more in taxes than you get back is above minimum wage. I'd expect it even higher in Denmark.
I don't know which are more doomed. Countries who don't „accomodate“ immigrants, or countries who let them in and fail into assimilate.
Policies should be based on proper statistical evidence. That's exactly the point.
> countries who let them in and fail into assimilate
There is no meaningful definition of "assimilate" in this context, at least not one that would be desirable. Immigrants have to follow the law like citizens and need to pass a language test. That's it. Anything beyond and above that is personal conjecture of the people who demand it, as there is no broad common denominator between the born citizens of a country either. You shouldn't demand of others what you cannot achieve within your own citizens (neither would any homogeneity be desirable and healthy for a country, but that's another matter).
Why not desirable? It'd be very desirable for immigrants to adjust to local society. If people are not willing to integrate and assimilate their kids into host society, they should not come.
We should not see people as economic unit who just produce value. People and society in general is much more complex system.
One common denominator in vast majority of europe is not being a muslim. And many of issues with immigration does raise from this fundamental difference. And I'm not saying to not let in any people from muslim countries. But they should denounce their religion the moment they get work permit. And don't raise their kids accordingly.
My thinking was, cutting taxes via budget reconciliation (which is the only process the currently paralyzed legislature can do) requires some hand waving deference to the notion of being revenue neutral by the Byrd rule, so cuts to social programs or rollbacks of government spending have been increasingly included as a way to get tax cuts. Tax cuts fund your donors who fund your reelection campaign.
But, I just looked it up again for this comment and that same rule says "No changes to social security" in reconciliation. It is specifically called out as forbidden to touch via reconciliation unlike almost every other program. So, maybe you are right, it will just be ignored because it doesn't seem possible to quietly change.
The income part of SS is more or less subsistence level, which arguably was its intention to keep the elderly from begging in the streets. But in the dystopian US healthcare system, Medicare is arguably the more important part of the social net. Without it, you are not going to afford any healthcare in old age.
If this budget hits the PAYGO limits, which is basically guaranteed, that will trigger automatic cuts to Medicare, so they can backdoor cut the program without anybody voting for that.
Where is the political incentive not to do this ever? If you reduce spending on social safety nets, you can reduce taxes on the wealthy, and as a bonus the poor die. win/win.
You can reduce taxes on the wealthy without reducing spending, which is what the Republicans just did, kicking the can down the road to a future administration while getting the political benefit of the current spending.
Not sure about the US, but from what I have seen in Europe the questionnaires show that older people are actually for these policies more so than young people, especially when they are already retired and thus not affected. In Germany, two thirds of retirees answered for abandoning a public holiday while everyone else was by majority obviously against it.
Trump is priming to con the Republicans into touching the third rail, and they'll all lose their seats. They're already warming up by chopping Medicaid. It's stupid, unnecessary, and cruel.
that's easily "solved" by setting the cutoff date to benefit the older generation. I believe that kind of ladder kicking is exactly what's happening in the article on Denmark, and how several other European countries squared that circle.
"Not retiring" in the US will be more dictated by inability to purchase a home than Social Security.
Look at all these people around you in their forties who are still renting. They are basically too late to buy. They will be "forever renters". This means they will have to work until death, as their rents continue to rise when their peers who owned homes took their downsizing premium and lived off of it for a few years.
What's crazy is the number of grown adults who think their 401ks will magically grow to fill the gap.
I hear this sentiment frequently but it doesn't pencil out. Renting an equivalent unit will typically, month-to-month, be cheaper than buying. Of course a significant portion of the monthly mortgage payment goes to principal which increases your net worth, but there are many cases where the money you save monthly by renting will actually exceed the principal you accumulate from your mortgage payment. In fact, there are plenty of helpful calculators to help you figure out what makes the most sense if you don't have a love affair with Excel [1].
You may argue that the the value of the house will appreciate well in a good market, but there is nothing stopping you from taking the money you saved by renting and putting it in an appreciating asset.
Where do I input the yearly growth of the property's value? Property prices where I live in Sydney have grown ~7% on average over the last ten years. That's higher than the average loan interest rate over the last ten years of ~4.5%. It's possible to find some other investment that earns more than ~7% profit, but in order to really be more profitable it would also need to cover the amount you spent in rent over that period.
You can still find plenty of reasonable housing in the US. As for young people on the coasts, yea I don't know how they will own a house within the next 10 years.
Housing in the US isn't anywhere near as cost prohibitive as a vocal minority of people like to make it sound like it is.
You just have to give up on the Santa Monicas, San Franciscos, and Manhattans of the nation. There's plenty of affordable housing outside the top tier cities, and modern tech has made it easier than ever to work from practically anywhere on the planet.
The only people in their 40s I know of who are still renting that I would consider "forever renters" are being extraordinarily undisciplined with their finances and spend what they could be saving towards a down payment on credit card debt they self-inflicted.
From my uninformed perspective this seem like a rather big and sensible lever toward rebalancing US national finances. The actuarial math must have changed significantly since the inception of the program, no?
Not significantly compared to other changes. SS taxes are at a much higher rate than when the program started. The workforce is also vastly more productive enabling a much higher standard of living.
What ended up happening is we rebalanced the program based on a lot of positive changes and used a huge ‘surplus’ to subsidize government borrowing, and nobody wants to adjust for any negatives ever.
The US may have to raise the retirement age eventually but it could put off needing to do so for a long time by making the payroll tax flat instead of regressive. Currently here is the percent various workers pay:
Just make it 6.2% across the board and it will push off the need for further major reforms far enough to largely get past the peak in Boomer retirements which are happening now. Maybe gradually raise the rate from 6.2% (which has not changed since 1990) to 7.2% to be safe.
Once Boomers pass through the system and start dying off in significant numbers over the next 10-30 years there won't be any size differences between successive generations nearly as large. Gen X is smaller than Millennials, then Gen Z is between Gen X and Millennials in size, and the current generation is projected to be around the same size is Gen Z. This should make it considerably easier to keep the system working.
Polls show [1][2] that this approach (flat rate + 1% gradual rate increase) is the solution voters prefer by a large majority regardless of party affiliation when presented with all the solutions that have been proposed by politicians and experts.
Generally whenever Democrats in Congress introduce bills to address the problem this is the approach they go for, although sometimes they talk about keeping a lower marginal rate for people making between $176100 and $400000, like this:
Republicans in Congress do not really have a coherent approach to this. There's a powerful group in the House called the Republican Study Committee, which is a large conservative caucus of around 190 members (~85% of House Republicans). They are the ones setting Republican policy in Congress on this issue.
According to them there are only three ways to fix Social Security: some combination of (1) raise the money it takes in, (2) reduce the amount it pays out, and (3) make up for any shortfall by paying some benefits out of the general budget.
They also say that #1 and #3 are off the table. Their proposals generally go for #2 via raising the retirement age. That does buy some time but not much, and runs into the problem that the Republican Party Platform says (caps in original) "FIGHT FOR AND PROTECT SOCIAL SECURITY AND MEDICARE WITH NO CUTS, INCLUDING NO CHANGES TO THE RETIREMENT AGE", and Trump also keeps saying that which doesn't leave them any options.
Because politics. Americans like to delude themselves that their taxes are low by splitting them up into various buckets (Social security, Medicare, Federal Income tax, State income tax, even city income tax some places, property tax, sales tax, and now tariffs). Like selling a computer then charging for the keyboard and the power supply separately. Makes people feel like they're paying less.
The numbers only work if you assume the program exists in a total vacuum. You can expect Congress will borrow any social security surplus as they start running short in other places, like Medicare.
I’d encourage thinking not just about yourself or your immediate circle when it comes to policy like retirement age. State run pension systems affect nearly everyone, not just the extremely fortunate few who can become financially independent at a younger age. And that is also largely an American phenomenon anyway. Salaries are much lower on average than in Europe and there is far less differential between minimum wage and what senior employees get paid. There’s also not the same culture of investing because European companies don’t have the same performance as the US stock market. Lower yield real estate investment is much more common in many European countries. And with strong social safety nets Europeans are generally less pressured to save a huge nest egg.
So this raising of the retirement age will affect a huge portion of workers and 70 is OLD to be working full time for all but the most relaxed jobs. Most older folks I know have know being dealing with multiple chronic age related illnesses well before 70.
It's a financial goal that is literally based on how long you plan to live, aka, your age.
Let's say I have €100.000 in the bank and that's two years of expenses based on my budget. Can I retire tomorrow? Well, what's my age? and what X do I plan to add to my age to determine if that amount of money is sufficient to retire?
It's utterly insane that people need to work more and longer as technology increases productivity. A truly dystopian economic system.
In 1930 Keynes projected that by 2000 their grandchildren could work 15 hours per week¹. Now the projection is that we will work more and longer in the future.
And what is this labor supposed to even do? How much of even current work really increases wellbeing?
Graeber's thesis of bullshit jobs becomes increasingly more convincing: work isn't about production, it's about social control².
If you wanted to live to a 1930s standard of education, healthcare, food, entertainment, interior decorarion, transportation, savings etc etc you could most definitely do it on very few hours of work. Lots of people associated with homesteading, tiny houses etc do so.
That said I agree we should be further ahead in paving a way to paradise.
It's not necessarily about the standard of living, but about production going into the zero or negative sum status consumption. Or as Keynes puts it:
> Now it is true that the needs of human beings may seem to be insatiable. But they fall into two classes -- those needs which are absolute in the sense that we feel them whatever the situation of our fellow human beings may be, and those which are relative in the sense that we feel them only if their satisfaction lifts us above, makes us feel superior to, our fellows. Needs of the second class, those which satisfy the desire for superiority, may indeed be insatiable; for the higher the general level, the higher still are they. But this is not so true of the absolute needs -- a point may soon be reached, much sooner perhaps than we are all of us aware of, when these needs are satisfied in the sense that we prefer to devote our further energies to non-economic purposes.
It's precisely what Keynes meant. He meant that 15 hours of labor now will buy you what 40 would then. How could he have meant anything else?
How would he anticipate houses 50% larger than his generation's, or cars with twice the horsepower at four times the gas mileage, or universal air conditioning (as few houses in the US lack air conditioning now as lacked running water in 1950) or a monthly bill for Internet or proles being able to afford intercontinental flights more than once in a lifetime?
He postulated eightfold increse in economy, though not clear at what working hours. If he assumed 40 hours then and eightfold productivity increse, with 15 hours that would still be threefold increase in living standards. The productivity has increased even more than eightfold.
Keynes was quite damn good at anticipating things.
Yes. That's math, the rule of 72. At a 2% growth rate the economy will be 8 times larger in 108 years, more or less. The rate is a bit higher, so we're a bit over 8 in the 95 years since that's been written.
> Keynes was quite damn good at anticipating things.
But that's not anticipating things, that's projecting an existing growth rate out for another century. Improbable really that it would neither rise nor fall, and one of the reasons it hasn't fallen is that we didn't cut our work week to 15 hours. So the only thing (in this context) that he really anticipated was wrong.
It’s not insane. People are living longer than before, unfortunately when initially set up, people didn’t take increasing longevity into account as well as lower fertility rates. Quite a few people never got to retirement when initially instituted. Where is money supposed to come from?
Historically, in multigenerational households of yore elders were productive till they could no more.
Retirement started as ”you’re too old and frail to work”, but morphed into ”now that you’ve worked for a number of decades, you can relax and enjoy life for 20+ years before your health starts to deteriorate”
Personally I think we should revert to the earlier system, where you are free to retire as soon as you want on your own money, but if you want the state (=other regular people) to fund your lifestyle, you need to be no longer fit for work
Yes, that's what strikes me as well. Where is the productivity gains going? Why are we still working 40 hour weeks, and possibly even for many more years?
If I remember correctly, Denmark even removed a holiday recently. So work more days a year as well.
That's the problem here. That a few people reap all the benefits of this, while the rest of us toil.
I wonder what a good answer would be here. Intuitively we are increasing productivity in activities that does not increase social welfare. Take corporate lawyering, marketing as an example.
The rising wealth inequality is a blunt answer. Similarly saying that we are increasing productivity in activities that protect interest of the rich.
It seems that significant amount of productivity gains are lost because of activities that profit from deception and counter activities that accounts for them.
I have no specific figures to back this up, but my assumption is that as we become more productive, more credit is made available, which leads to bigger debts and asset price inflation. Because of the asset price inflation, the debt is not necessarily used for productive purchases but, for example, to pay more for existing things - the obvious one being a home. The productivity gains are therefore claimed by creditors.
It would be interesting to see how well productivity increases and debt growth (esp. private) correlate.
Its an intrinsically anti-human system thats starting to need less and less people. How these surplus people are dealt with isn't going to be pretty... Hopefully it results in the actors, being human and all, having a social revolution and pivoting away from it.
> In 1930 Keynes projected that by 2000 their grandchildren could work 15 hours per week
This projection came true. You can live with a 1930s living standard while working 15 hours per week at a median wage. However, nobody wants to live at a 1930s living standard. It turns out that in aggregate people prefer to spend productivity gains on conveniences and higher standards of living than on working fewer hours.
- Asset inflation can be tackled with flexibility. The level of flexibility my acquaintance showed is not required. He bought a fixer-upper two apartment building with a garden in a livable small walkable eurozone city for 5k€.
- The productivity growth really has had incredibly strong deflationary effects. So much more, more diverse, tastier and healthier food for example, for so much less money.
- The growing affluence has really created incredible opportunities for scavenging from the waste stream. A practical example. About half of the food I eat is leftovers from a nearby school. I'm proud to be saving good food from going to waste _and_ it lowers our expenses quite significantly.
It's not insane if you consider that people neglect to raise the next generation to fund their retirement. Fund in the real sense: by doing work and ceding part of the yield to people who retired from work but keep consuming.
Whatever people save for retirement, cash or stocks or points, it only facilitates the said exchange, it doesn't somehow replace or alleviate it. It only works if the next generation exists and is prosperous enough to share their income.
> How much of even current work really increases wellbeing?
If you think about it, there are fewer and fewer jobs that are genuinely useful.
I know it's a difficult topic, but I can't shake the feeling that we need some sort of government intervention in order to reorient the economy towards activities that actually benefit us.
> It's utterly insane that people need to work more and longer as technology increases productivity.
Productivity gains are kept by the owners of the institutions as profits that made that productivity possible. Do you think YOU will work less once LLM tech is deployed at scale? Of course not, your company will pay you the same and expect the same work. Every company out there will do the same. They will reap the productivity gains.
> It's utterly insane that people need to work more and longer as technology increases productivity. A truly dystopian economic system.
Keynes was almost right. He underestimated the ability of future generations to consume conspicuously. Also, the need for many to fit in by working, but I digress.
Many don't _have_ to work more and longer. I'm speaking of a large class, very much overrepresented on HN, of smart, healthy westerners with no dependents to care for. We have only one major problem. We live in this bubble nudging us towards conspicuous consumption - gently or less so.
My job closely resembles Keynes' 1930's prediction. Sometimes I work (much) more. Not because I need money, but because the job is interesting. Interesting as in, me learning, contributing something positive to other people's lives, growing my family's financial resilience and robustness, or just enjoying the flow.
We don’t live with 1930s standards of housing, education, welfare, material wealth, services, etc, etc, etc. Compare the taxes you pay now with the taxes people paid in the 1930s.
I would like to point to a topic about extending pilots’ mandatory retirement ages. Most pilots plus or minus retirement age are unable to pass the physical or mental demands of the job, so only 25-30% are able to work and not on short- or long-term disability. Some choose to work privately past retirement age. I don’t have any numbers for pilots who decided to leave, were forced out, or could not pass the training.
Extending the retirement age doesn’t really help the situation much, as you need younger and cheaper pilots to fulfill the roles of pilots who are retiring.
The problem is, becoming a pilot takes a fair amount of time, over $100k in training fees, low pay for a while until fully certified with hours in, a very mobile lifestyle, and now you are subjected to physical as well as mental demands of the job certification standards.
There are quite a few highly paid professions where the main purpose of that profession’s union seems to be to prevent there being an adequate supply of the professionals.
I'd call this soft power projection by medical means. Which is absolutely OK IMO, compared to lets say producing AK-47, or meddling in other countries internal affairs, invading and destroying them, and whatnot else.
I think you're overcomplicating things. Castro was very vocal about medical care being a top proority during and after the revolution. There's no coincidence or conspiracy.
When you try to build a society around human needs instead of capital needs, you end up with different priorities. It's that simple.
If anyone thinks they're making the big bucks and accumulating "soft power" by training a bunch of doctors then selling treatments to Americans for cheap, I'm not sure they can be helped.
Yah. Maybe I can't be helped. Shrug. I got aware of this, I don't know exactly when anymore, has to be about 15 years ago now, or even longer.
I wondered about why there were almost always cuban medics, doctors, nurses etc. in action, when there has been some larger catastropic event in the world, and you could see them in the media.
Why is that, I thought? That doesn't fit being sanctioned by the US(and vassals), being poor in general, and so on.
That's how I became aware of ELAM.
And made up my mind the way I described. Can't help it :-)
Maybe I should have written Why is that? According to the picture mainstream media is projecting, this shouldn't be, because they can't afford it?
I'd feel offended if the YOU in "You cannot imagine a motive beyond calitalist logic, but that doesn't mean nobody else can." was addressed to me, personally.
Or was it just meant as a general description of the concept?
It's easy to have really good health outcomes at really low cost if you just fabricate the data. It's easy to export lots of doctors if you force them to work abroad, force them to pay most of their salary to the government and hold their families hostage to ensure compliance.
It's difficult to understand your point given how this was written. However, it's worth pointing out that the Cuban doctor export scheme is, in fact, very profitable to the Cuban government.
Much less so to the doctors themselves, which frequently have to work in what amounts to conditions of indentured servitude. And they have no other option, as working as a domestic doctor in Cuba typically pays less than being a taxi driver.
One has to wonder why they don't just copy the Cuban model of having a surplus of their own slave doctors, especially given the supposed immense profit potential!
To be honest, I'm not convinced of your explanation.
The US docotor shortage is a myth. Wait times are the result of beauracratic nonsense has reduced the efficiency of the existing physician workforce [1, 2].
In my experience a big part of the problem is specialists. I remember many years ago people were saying that we shouldn't go to a Canadian style single-payer system because Canadians had rationed care and they had to wait six months for a hip replacement.
Well, guess what? I now also have rationed care. I have to wait six months just for a colonoscopy, plus I pay twice as much for the privilege!
Part of the specialist problem is they make so much they realize they can work for ten years and retire, instead of working the 20-30 years that used to be common.
Has nothing to do with wait times. AMA lobbies the government to keep number of seat at med schools low, number of residencies low, etc. as a result number of licensed doctors is low, and salaries remain high.
The AMA has been arguing for increased medical school seats and increased GME funding for about 20 years now. There have been 27 (!!) new medical schools opened in the last 15 years, in large part driven by the AMA in its capacity as one of the two primary stakeholders in the LCME, which accredits allopathic medical schools.
1 out of every 7 medical schools currently active in the US was founded in the year 2010 or after. That's a veritable bonanza in medical school creation, facilitated by the AMA.
Because they are overworked? Most of the physicians I talk to want more physicians. My understanding is that the limit on residencies is a huge bottleneck, which receive most of their funding through CMS.
Its just like nationality based employment rights(need to be citizens or have a visa/permit to work) but more granular.
It can have its place, i.e. a way to balance bargaining power with the employer. It’s inherently anti meritocratic though.
In some cases it’s not about merit or about limiting supply however. In some cases it’s impractical to test someones work continuously, so instead it becomes honor based. That is, you are expected to go through an elite track and succeed in an exam once and then you are good for life unless you commit fraud or show gross incompetency.
The cost of training is real. 15 ago a colleague did the training slowly while working for some training companies and it costed him just $42,000 to get ATPL, but you need to take trainings and flight hours and that is most of the cost. There are enough people willing to become airline pilots, but most don't have the money and the cost is not an artificial barrier.
Even the cost of PPL, the lowest license on the path, is around $10,000 while the ultralight (European)/sport pilot (US) is over $6,000. From that you need CPL (commercial), multi-engine, complex aircrafts, instrument rating (bad weather or night) etc., that takes time and money most people cannot afford.
What I find interesting is how often casual discussions about unionization on the internet will organically reinvent this concept. Especially on HN, Reddit, and Twitter the banter about unionization always seems to pivot toward using the union to force companies not to hire certain developers.
The obvious one that comes up in every discussion is thinking that unions will protect their jobs from being outsourced to other countries. People like to layer various more palatable explanations on top of this to make it sound better, but when you ask them if the employees who receive the outsourced jobs should get the same union protections you usually get their real motivation: They want to keep the jobs local to their own market and exclude foreign labor supply in order to improve demand for their services (and therefore their leverage, and therefore their own wages)
It gets interesting when different demographics start imagining that their ideal union would protect them from other demographics: Commonly, older people like to think of unions that will protect them from losing their jobs to young people.
Then when I’m working with college students and they start discussing hypothetical unionization, they come up with ways to think the union will give them more jobs by protecting them from the old people “hoarding” the jobs. (Sorry, that’s the least likely outcome for a union)
What’s most interesting is that the people I know who are in unions (non-tech industries) don’t hide the fact that decreasing labor supply to increase their own demand is exactly what they expect from a union. The first time you hear someone complain that a non-union worker is “taking food off their table” by simply doing their job you realize that it’s not as simple as Unions versus Corporations like we’ve been led to believe. The Unions are advocating for the people in the union, not workers everywhere.
> The obvious one that comes up in every discussion is thinking that unions will protect their jobs from being outsourced to other countries. People like to layer various more palatable explanations on top of this to make it sound better, but when you ask them if the employees who receive the outsourced jobs should get the same union protections you usually get their real motivation: They want to keep the jobs local to their own market and exclude foreign labor supply in order to improve demand for their services (and therefore their leverage, and therefore their own wages)
Bear in mind it's completely normalised for companies to charge higher prices in one market than another, and put barriers in place to make sure customers in the more expensive market can't just pay the lower price. So all the union is doing here is bringing it closer to a level playing field.
The broken pilot training pipeline is mainly a US problem. Airlines got spoiled because the military trained thousands of pilots every year for "free", then some would go on to get civilian flying jobs. Now the military is smaller and there aren't enough experienced pilots coming out. But there's nothing preventing airlines from hiring pilot candidates with zero experience and paying them to go through flight training. Some other countries do this and it works fine.
For pipeline capacity, it's not even really broken in the US. The airline problem is that they have to whipsaw between "growth is stalling, time to furlough our junior pilots" and "growth is now, time to hire all junior pilots with ATP minimums". But there's enough pilots being trained to handle the average.
Seventy might feel like fifty in Scandinavian cities where cycling is part of daily life—but try that in the U.S., and the idea of retirement quickly becomes a parody.
The US already has a retirement age of 70 depending upon how you figure it. As noted in sibling comment, depending upon various factors, that's the age it's generally recommended to start receiving social security benefits unless you want/need smaller payouts sooner. Medicare starts at 65 however. IRAs don't require you to take distributions until you're 73.
This comes about due to incompetent politicians running things. Australia is spending billions on nuclear subs it doesn’t need, and even paying France $300 million for not buying their subs.
Australia doesn’t have enough money for that? No problem, just make everyone work longer.
As an individual if I don’t earn enough to cover my spending I have two choices.
1. work more
2. Spend less
In all these discussions we never see politicians do anything about spending less, they just throw us under the bus to work more, while of course exempting themselves.
The birth rates have been low for a decade. I wonder if the change is triggered by US stock market downturn where majority of EU pensions are invested and expectation of a doom.
Without discarding the issue of the moving goalpost, I do wonder what the quality of life contrast looks like between a 70-year old in 2025 and a 70-year old in 1925. Note: I arbitrarily picked the latter date, as I wasn't able to (with a quick search) locate the year in which the original retirement age was established in Denmark.
I also wonder what it would look like for the government to encourage (or even facilitate) "jobs for seniors" that only become available to you after you turn 60. They could be jobs that are, by design, low-risk, low-physicality, but medium-high mental stimulation.
my sources : "a History of the Lutheran Church in America", and a personal history written at that time. If your records are accurate and unbiased, I would accept that answer completely and admit it.. but I am not convinced both of those are true. It is interesting and more clarity is welcome. Also your estimate of the population varies by 40% so the accuracy is in question.
Why do people owe me a nice retirement? I never really got the idea of state-funded retirement. Perhaps I should feel I'm owed something if I'm too fragile/disabled to work, but I don't know why age alone should grant me anything?
Appreciate this is a controversial view so interested in hearing why I'm wrong so I can stop holding it. I think retirement should just be replaced by disability welfare to be honest.
The state pension in most countries is simply a collective pension fund that you pay for during your working life (or your employer does on your behalf). The state owes you retirement because you paid for it. It's not a handout that others are paying for you; you actually paid for it your entire working life.
So, Denmark raising the retirement age is kind of a big deal. I imagine the Danish might be less than thrilled about that.
Open a history book. Read upon why state pensions were introduced - by people who thought like you actually. (Spoiler: because alternative doesn't end well even for the wealthy.)
Isn't 19th century covered by history classes anymore? :/
At least in Europe, you pay a percentage of your wage into the state’s pension fund. Details vary by country, but it’s not uncommon that you contribute automatically 10% of your gross salary. For your entire working life.
The state then being kind enough to give you something back after 35-40 years of contributions is expected.
Just to throw out one reason - it's valuable to working people because they don't have to take care of their parents in old age. Can't speak to Europe, but Social Security in the US is definitely not enough for a "nice retirement". It may help a frugal person in a low cost of living area cover their basic expenses.
> Social Security in the US is definitely not enough for a "nice retirement".
A two-retiree couple who contributed at the tax limit for long enough would get $122,592 in Social Security benefits in 2025. Not beachfront living in the Hamptons, perhaps, but not cat food eating money either.
The state isn't paying for it, you're paying for it, through your taxes. (Technically you're paying for the next generation's retirement, but it's the same principle.)
There is an obvious solution to the problem of ageing population and declining birth rates. Furthermore, it's a solution everybody's secret soul wants very much: keep people younger for longer. Invent rejuvenation. But politicians would never dare go in front of cameras and say that they will put a dollar into R&D for such an outcome, because the wall of insults and disdain we would hurl, for no rational reason, at them, would be higher than a tsunami. There is something seriously broken in our collective psyche.
And while we're at it, can we do teleportation too? Think of all the parking hassles, the car accidents, the carbon emissions we could save! And yet, just try to convince those funding agencies...
You're equating teleportation...something that violates our current understanding of physics..with rejuvenation, which does have some promising peripheral research, such as studies on telomeres.
It might be the obvious solution but is it the right one?
People are significantly more productive than say 50 years ago due to technological advancement. So where is all the money going?
I am no economist but it is my understanding that all this extra money goes to the rich because they've entrenched themselves in positions where they can extract a portion of a person's income with no recourse.
It's not normal that a single person can legally own tens of apartments and get a third or each tenant's salary without providing any value to society. It's not normal that companies can own residential properties, they have no use for them other than extracting money from people.
I recall danluu blogging about how multiple times he made code fixes that saved the company more than his salary just in electricity. What I see is an incredible technical achievement but also I see how he's being exploited - the money saved is value he directly provided to society, yet he sees none of it. Where does it go? To people who are already rich.
> People are significantly more productive than say 50 years ago due to technological advancement. So where is all the money going?
People have far better lives considering all the things available to them compared to 50 years ago. Most people would not want to live life like how people lived it 50 years ago.
> It's not normal that a single person can legally own tens of apartments and get a third or each tenant's salary without providing any value to society. It's not normal that companies can own residential properties, they have no use for them other than extracting money from people.
This is definitely a problem but I don't think the only one.
> This is definitely a problem but I don't think the only one.
Certainly. Planned obsolescence and devices being impossible (or illegal) to repair is another. If a device costs 20% less but lasts only half a long, buyers are losing money because the profits go to the rich more often.
Food has ingredients and an expiration date on the packaging as required by law. Expected lifespan should be required for petty much everything.
There are tons of companies researching methods to increase life expectancy and rejuvenation. There is not much controversial about it yet.
It is not that it is hard because it is a controversial subject. It is hard because it is not one problem. To develop rejuvenation you would need to tackle hundreds of very difficult problems, both physiological and neurological, which individually, would represent solutions to critical conditions today (diabetes, dementia, ataxia, arthritis, many types of cancers etc etc).
I definitely don't think we have succeeded in "invented" this, but it surely has happened slowly over time. People in theirs 60s today are surely sharper than they used to be, with less chronic physical ailments.
But the end results is people living longer, and the solution still ends up being pushing back the retirement age.
That's because it has no guaranteed outcomes and it's just a big bet. It's not a "solution" until it's proven to work. If you bet on some unproven tech to save you in the future and that never materialises then as a country you're fucked. So the disdain and contempt would be 100% earned towards towards anyone who would seriously suggest betting the future of society on some unproven technology. Only techbros would ever suggest something so profoundly out of touch with reality.
So this means that eventually Danes will not be able to draw from their government pensions until the age of seventy? Is there a mechanism where people can stop working before age seventy if they save privately?
> That’s what happens when nations like Denmark and Sweden with extensive social wellfare system, does not grow organically and instead allow people to invade their countries and let them use the system without giving anything back.
Some immigrants do a great job but way too many have no interest in integrating nor working, they are perfectly happy with getting money and social healthcare without giving anything back. They even get enough money to send to relatives not able to leave their shitty countries.
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[ 1.6 ms ] story [ 445 ms ] threadHow will this work realistically? How will you convince employers to keep workers employed till 70? Especially in fast changing fields like IT where a lot of old knowledge and experience gets considered obsolete by those screening resumes. Sure, people might survive longer, but that doesn't mean all workers will be equally mentally or physically fit to still perform well at some jobs at 70 as well as a 30 year old, especially if they're mentally or physically challenging jobs.
I'm not talking about government paper pushing jobs, but private industry jobs with international competition where you need to be agile and up to speed to survive as a business. This system worked for the boomer generation in slow moving highly regulated industries like steel, rail and automotive, where you'd spend all your life at one company who'd promote you and invest in your training till retirement, but this isn't as common anymore. International companies now want things done faster and cheaper and can't be competitive keeping 70-year-olds on the payroll idling around waiting for retirement.
For example, here in Austria, if you're laid off at the age of 50, the chances of getting another job at that age for many professions are already next to zero due to rampant ageism, so workers in some professions end up on long term unemployment till retirement, yet the government agencies are not talking about this major issue and just tell the 50 year olds on long term unemployment to "make a more colorful resume to stand out"(I shit you not). You're also not allowed to take your contributions out of that pot early or all at once to fuck off out of the system and be on your own if you want, proving it is Ponzi scheme in disguise.
Ok, so if you're near retirement now you're fine
But if you're younger, you can look forward to not retiring until 70, as if the younger generation hasn't been shit on enough
Amazing stuff. One last ladder for the older generation to pull up behind them before they die, I guess
the housing market in Denmark is approachable - you can get houses near major cities for usd 80k.
Social security, you can go unemployed for years and still pay your bills.
Government provided education with stipend - having masters degrees are common.
And the economy is strong.
Most Danes understand that this is inevitable - the big issue is that the politicians have given themselves more favorable terms.
- housing for 80k USD is 525k DKK: no way you can find anything at that price anywhere close to cph. Not sure for other "major" cities, but in cph you can expect to pay 4mil DKK (600K USD) for a ~60 sqmt apartment, prices will fall outside the cities, but nowhere close to 80k USD. Where did you get that number?
- you pay for your unemployment benefit, thought an a-kasse. Its not forever and it might barely cover your bills depending on where you live/your mortgage. If you have family its probably not enough and you need to add an insurance on your salary on top of that.
Just wanted to give my 2 cents.
Look 20 minutes out of Odense, Aalborg, Randers, etc.
Don't let yourself believe that a country is nothing but its capital - it is correct, that if you decide to live in a 4mil DKK apartment in the Copenhagen area, then you have also opted out of public help, and you are on your own.
Copenhagen: ~1.4M people
Odense: ~190K people
Aalborg: ~120K people
Randers: ~64K people
Again - why this extreme focus on the specifics? I merely argued that the housing market in the broader Denmark is reasonable, and you can usually easily commute to jobs in a city while living cheaply - something that is strictly more difficult in the US.
Saying that there is cheap housing 20 minutes outside of a town with 64K people doesn't really make the point that it's inexpensive and accessible to live in / near major cities.
> but I find disingeneus portraing a picture where in dk you can buy a house for 80k USD and leaving out the information that you are probably in the middle of nowhere - no jobs, no public transport, no services
The point is exactly the opposite. You can get a house at a reasonable cost, 20 minutes away from a city you can likely get a job in - Even well paid tech jobs (They exists in both Odense and Aalborg).
I fint it disingenuous to pick pick out a very specific situation like this instead of looking at the broader argument.
Can you share what well paid tech jobs exist in such cities? I mean jobs open to foreigners not just Danish citizens.
There are 53706 homes for sale today. 2784 of those are actual homes, not empty lots, costing less than 600K DKK.
I would not expect to live a healthy, comfortable life in most homes at that price range. Draft, mold, poor insulation and high energy bills.
Only for a short period were western population growing so fast relative to small number of retirees that transferring that responsibility to government was a no brainer.
With diminishing demographics anywhere except maybe Africa, we'll need to be more creative once again. Raising retirement age is just one of many hard but inevitable policies.
A new category of jobs will be created: retirement jobs. People unable to work till their retirement age, will be given simple low paid jobs to earn enough work hours to hit their retirement. Think of all the simple jobs currently outsourced: content moderation for social media websites, training data tweaking, LLM training, teaching assistants, street cleaning assistants, etc.
Just because you can hire a 68 year old to do content moderation or be an assistant teacher... does not mean that anybody actually wants him around at that age and that he will be a net gain to the environment. His speed and ability at work is inherently going to limit other people's speed in some way or form,not even just that. Even his vibe, his impact on the team. These things are all things that people consider during hiring. It's the concept of "the chain is only as strong as its weakest link" I suppose.
Sure, no will force to take up the jobs but when the choice is heating up your home in winter or working a couple of hours per day, the decision will be obvious
To do what?
>Similarly, firms relying on content moderation farms could use the elderly population.
Why would they do that when AI or foreign labor is cheaper? And this is happening right now, let alone in 2040 when there will be more automation and more offshoring. There no room for low-skill repetitive jobs in developed western economies unless you go full communism where the government employs everyone.
Who will create these job? Especially given the push towards more Automation in the west or at least outsourcing these easy repetitive jobs to countries in with lower wages as it is the case right now. When you call tech support, does an elderly US person answer or a person from India/Asia/LatAm? Do you think they'll hold back technological development just to give meaningless work to unemployed old people in the west?
But say such jobs are created, given how many youths are unemployed(in Europe at least), why would they hire people close to retirement instead?
The west has built itself into in a pickle with needing to work longer till retirement but has fewer easy jobs left due to automation, high labor costs, and outsourcing. What are you gonna do then, go back to uni and study another Masters' degree at the ripe age of 60 so you can retrain for another specialized job?
Maybe instead we should try investing in this area (reducing the burden on services) instead of simply trying to reduce the quantity of folks claiming from the state pension pot.
Now people live way longer, but the retirement age never got adjusted properly to the new reality. So 15-20 years of retirement is the new normal.
In addition, way fewer young payers for the now old.
I think it is possible, but we need to raise (corporate) taxes a lot, and this needs to happen globally, as companies move.
As a star I would love to see global minimum corporate taxes, and then take it from there.
Spend less, save more. Vote for governments that do likewise.
Isn't that something for the individual to decide, not the collective? Many derive from work a lot of meaning in life. If working is what makes some people happy, it would be nice to not punish people for working until they die.
> I'm not saying this is an economically easy problem to solve, but we focus so much on economics and so little on policies that make people happy.
Absolutely!
https://www.gov.uk/government/statistics/pensioners-incomes-...
They'll go directly from factory line to care home.
Only if they are poor. If they're rich, they can continue "producing wealth" from interest and investments even after they're dead.
It's a silly thing to say, of course, but it's built into most people's assumptions who are discussing it.
I might be misunderstanding your point, but I think they might be? E.g. in the UK:
> By 2023, the richest 50 families in the UK held more wealth than half of the UK population, comprising 34.1 million people
https://equalitytrust.org.uk/scale-economic-inequality-uk/
But it turns out young people become middle-age people, become old people, and we're all in this together. The real problem is not about how the pie is split across generations, but about the realities of lifespans, economic production, and expenses. If you're responsible for funding the entirety of your retirement, all of this is abundantly clear. When you nationalize retirement, all sorts of budgeting tricks start happening, like "borrowing" to fund other programs, papering shortfalls via population growth, etc. Then you start getting age warfare when the govt has to eventually cut back.
You could dissolve the national retirement plan, but that seems like a bad idea for similar reasons as entirely dissolving national welfare and insurance programs. It will always be the case that some people, need some help, some of the time. I guess in my ideal world, it's reduced to a much smaller safety net, because the government is managing the economy well enough that the populace has the wherewithal to save appropriately, and they are educated enough to do so.
Having people fund their own retirement would be ideal from a economic standpoint, but given the histories and complexities of existing systems, it is probably not acceptable politically, or morally, in any country. Honestly it's a distraction.
At the end of the day, a country cannot tolerate too many freeloaders. It doesn't matter if they're pensioners or retired at 50, living to 100 hedge fund managers. Productivity is really the only thing that matters for a countrie's economic destiny.
Or a population that can produce the same amount of stuff and services with fewer and fewer workers. Fortunately that's what capitalism excels at.
Is it better that retirements are funded by this surplus from the increased productivity, or by direct taxation on the income of young workers? Income growth doesn't keep pace with productivity so it's an easy answer.
Taxing the income of current workers to directly fund current retirees is the real "snatching away what you produced". If more national pension plans invested in broad-based stock indexes instead they wouldn't need to take more and more money out of young people's pockets.
Capital ownership entitles you to its returns. Young workers typically don't own a lot of capital. So it comes down to either retirement plans owning it, which means young workers also get its returns when they retire. Or a small wealthy elite could own it all, and everyone else gets left out, reduced to moving a dollar from an youngsters pocket to a retiree.
I knew a guy who worked full time at a bank at 85. He said all the time he didn't have to work but what else was he going to do all day? A big reason he was able bodied at 85 was from working and not sitting home all day.
I think we have confused retirement fund/planning marketing with reality.
The retired people I know are physical mess from retirement. Alcohol and restaurant food all the time, will be needing long term care much sooner than if they had worked longer.
I think it is a balance.
Auctioning this work to private companies should theoretically make it more cost efficient - and I think it is.
At least I hear that workers a much more stressed than they were historically, so I don't hope this comes with no benefit...
I personally find it hard to reconcile the concept of socialized healthcare with UnitedHealth Group being apparently the 7th company by revenue in the world, at least I don't think that's what Europeans would mean by "socialized".
https://countryeconomy.com/countries/compare/denmark/usa?sc=...
How these tax cuts are distributed over the population is... not very evenly. There was even an article yesterday in the NYT (iirc) that warned about wealth accumulation patterns in Sweden.
It is the same neoiberal experiment that the US has had since Reagan, just with some more social democracy.
This doesn't require any investment or technological development; it just requires making rational-but-politically-nuclear policy changes reducing the infinite tap of publicly-funded extremely-low-ROI medical expenditures on old people.
An absurd fraction of medical spending goes to protracting the suffering of old people just a bit longer. We can simply stop doing that, given the political will to do so.
Extending people's lifespans won't do much to alleviate these expenditures, except perhaps to slightly dilute the amortization schedule.
I think the system has failed at this point, when you are expected to work that long.
And this is the case in all western countries.
It is just being realized in different ways.
Fundamentalle there are 3 ways to cope
1. reduce pensions
2. Raise taxes
3. Decrease amount of benefit receivers.
Denmark choose number 3
The centre right often argue for less taxation ‘to grow businesses’. The argument being that the economy grows and that’s how the money is recouped. At least that’s what’s happened here in New Zealand.
Looking past ones next pay day does seem universally difficult.
Birthrates seem very hard to change and even if change would happen it is much too slow.
Germany did the experiment on immigration and has not seen GDP growth for half a decade. There the system is failing far worse in some ways, but in Germany employees are paying directly for the pension plans, so the state just raises the employee contributions.
Also, the beaurcracy is the real culprit for growth.
The more old people there is the more taxes you need.
More taxes - economy must grow. And it can’t grow if working population is shrinking
I think, if you are concerned with the cultural shift, you can give immigrants temporary term VISAs and make it clear their stay is going to be strictly temporary. That was supposed to be how the Gastarbeiter system works. Thing is, when you have already on boarded a foreign worker and have had them working for you for 2 years already, you don't want to let them go and replace them with a fresh foreign worker who you have to retrain.
You can look at any country in western europe to see how it's not.
[1] https://www.pure.ed.ac.uk/ws/portalfiles/portal/35314239/sre...
In the US, Italians, Irish, and Germans, as just a few examples, all were treated as unassmilated aliens. People say the same things, generation after generation about newcomers. If you moved to a country with a different language and culture, you might make an effort to learn the language but you would still think, read, etc. in your native language. Your kids would know both languages; their kids would of course speak the language of their surroundings.
What solves these problems is a fundamental belief in freedom for all. People don't need to speak your language to be your equal and be just as human, with the same rights as you.
Here's Benjamin Franklin (Palatine refers to the Holy Roman Empire or Germanic regions, depending on the source):
"[W]hy should the Palatine Boors be suffered to swarm into our Settlements, and by herding together establish their Language and Manners to the Exclusion of ours? Why should Pennsylvania, founded by the English, become a Colony of Aliens, who will shortly be so numerous as to Germanize us instead of our Anglifying them, and will never adopt our Language or Customs, any more than they can acquire our Complexion.
Which leads me to add one Remark: That the Number of purely white People in the World is proportionably very small. All Africa is black or tawny. Asia chiefly tawny. America (exclusive of the new Comers) wholly so. And in Europe, the Spaniards, Italians, French, Russians and Swedes, are generally of what we call a swarthy Complexion; as are the Germans also, the Saxons only excepted, who with the English, make the principal Body of White People on the Face of the Earth. I could wish their Numbers were increased. And while we are, as I may call it, Scouring our Planet, by clearing America of Woods, and so making this Side of our Globe reflect a brighter Light to the Eyes of Inhabitants in Mars or Venus, why should we in the Sight of Superior Beings, darken its People? why increase the Sons of Africa, by Planting them in America, where we have so fair an Opportunity, by excluding all Blacks and Tawneys, of increasing the lovely White and Red? But perhaps I am partial to the Complexion of my Country, for such Kind of Partiality is natural to Mankind."
https://www.theatlantic.com/politics/archive/2008/02/swarthy...
My girlfriend asked me once in a Restaurant (Cafe Norden in Kopenhagen) why I was ordering in English. Then, I spent the complete evening ordering everything in Danish, to always receive answers in English. And this nearly everywhere (not my bakery, the girls there could not speak a word of English, this was an exception). This was in the early 2000's. This never happened to me in all the other countries I have been living in. A Danish colleague simply told me that he does not like to listen to broken Danish, better switch to English.
Still have a lot of friends in Denmark, integration there is not easy, even for highly qualified people from the EU.
In practice that rarely goes as intended. The first political party to say, "We changed our minds, you can all have citizenship," gets to secure power with an influx of loyal voters.
Before: 5 million illegals or immigrants.
Party A passes law making them all citizens.
After: Party A always wins because large portion of the new 5 million vote for Party A
Conversely, if this hypothetical party had a secret agenda to pass the law when they get elected, but they kept this a secret until then... first of all they will probably lose of voters in the next election. Also, they might find out that former immigrants do not automatically reward this behaviour in terms of votes.
I do not find this scenario particularly realistic.
In Denmark, immigration from culturally similar countries are usually net-positive, while others are net negative (financially).
There's a reason people are choosing to vote for parties that are (publicly) anti-immigration
People just make this stuff up, any rationalization for hatred. It's not hard to see how immigration has worked, how Europe integrates with itself (a continent that fought endless wars before the proto-EU was born), and how the US is a country of immigrants. Rather than repeat it all, see:
https://news.ycombinator.com/item?id=44092557
Excerpt, from Ben Franklin:
"... Why should Pennsylvania, founded by the English, become a Colony of Aliens, who will shortly be so numerous as to Germanize us instead of our Anglifying them, and will never adopt our Language or Customs, any more than they can acquire our Complexion. ..."
Europe integrated itself because European countries have very similar culture, and are same/similar race.
Paris and London used to be great cities. Not anymore, they are just living off their formal glory.
It feels like your image of London/Paris is based of movies and tv shows.
And that is with massive disinformation campaigns against immmigrants and 'liberal' cities.
(No offense to Warsaw - maybe only NY and Tokyo measure up to London and Paris.)
In America, we discovered basically by accident[0] how to bring in large groups of people and have them be economically and socially productive. Specifically, we had very generous family reunification programs, which outsourced the question of "what immigrants do we admit" to immigrants who had already successfully integrated. Effectively America became an invite system. The end result is that, for basically any background, every American city has a large and established immigrant population from that country for new immigrants to fall back on.
Other Western countries (e.g. western Europe, Canada, the UK, Australia, South Korea, and Japan) didn't do this. Instead, they treated immigration as a transaction: you can't come in unless you have some immediately beneficial purpose, and permanent residency is going to be an even higher bar still. What this gives you is immigration systems that select entirely for disaffected, college-educated workaholic youths with no connections to the local city. To put it in the words of Canadian Prime Minister Mark Carney:
"America is a melting pot. Canada is a mosaic. In the United States, they don't recognize differences[1]. They don't recognize First Nations. And there will never be the right to the French language."
These words are telling, in ways Carney probably didn't intend. He is proudly admitting that the thing that sets Canada apart from America - the thing that they should fight with military force against a wannabe dictator with annexation dreams - is the fact that they can't integrate people worth a damn.
[0] Family reunification visas were originally intended to deliberately preserve racist prejudices in the US immigration system. This backfired comically.
[1] ...has this guy never heard the phrase 'African-American' before?
So you can reduce pensions, improve the situation for the youth, take efforts to get an improved birth rate, making use of the resources lost to pensioners, and then maybe you can raise the pension later on once you realize things are stable.
I suggest instead altering the male/female ratio, so a stable or growing population can be maintained at lower TFR. Technically, filter sperm to remove those with Y chromosomes before artificial insemination.
Also sexual selection is a thing and I think we were really never meant to have this many men. Men seem good for being really successful or otherwise dying, not much in the middle.
But also, all this talk is purely from a reproductive standpoint. Human societies also need to consider fairness and rights.
Also, that's a wild solution. You'd have to do away with monogamy which would cause some pretty insane societal shifts. However, as a straight guy I can see the appeal lol.
I'm imagining it becoming a social norm for single women to have (at least) a single child. Perhaps they'd team up to make raising them easier, forming loose family-like units. Romantic attachments would be optional.
One consequence of such a situation would be an incentive toward private positive eugenics. Women would prefer semen from top quality donors.
People simply can't afford to send a kid to pre-school childcare because it's 2 or 3 thousand GBP per month. So you have to stay at home to look after them, but then you can't afford the rent/mortgage and/or food because you're not working. Woe betide you if you earn over 1 penny over 100K GBP because then you get zero help with costs.
They need to provide more government funded (i.e. universally free non-means-tested) pre-schooling like they do for 5-18 year olds.
If someone tried to implement it- aside from the obvious problem of authoritarianism- the resulting male minority would live life in romantic "easy mode" so people who want the best for their kids would want male children and rebel against a system more likely to give them female children who would find romantic prospects difficult.
I suppose if someone invented a way to alter sexuality to allow straight women to opt into becoming gay the romance problem could be mitigated, but I'm guessing that this is impossible given the human brain is only so neuroplastic in adult years.
For an interesting case study, compare Japan (who refuses to allow mass immigration and is at risk of going extinct) and the UK (who has embraced it and is on the way to becoming Muslim-majority). It'll be interesting to see in 50 years which one has had better outcomes.
[1] https://en.wikipedia.org/wiki/Religion_in_the_United_Kingdom
> Between 2001 and 2009, the Muslim population increased almost 10 times faster than the non-Muslim population.
https://en.wikipedia.org/wiki/Islam_in_the_United_Kingdom?wp...
Granted 2009 was a while ago but they're still the fastest growing population in the UK by a lot.
If it grew 10x between 2001 and 2009 (starting from a very small base), then between 2009 and 2023 it grew by only 0.3x (see graph below).
So rate of growth went from 10x to 0.3x in around a decade, this is a hugely significant deceleration. It actually implies muslim community as portion of population is heading lower.
https://new.islamchannel.tv/wp-content/uploads/2024/04/63860...
However - if we're including atheist then clearly that'll be the majority position.
* well, not even current. 15+ year old
Stepping back a bit, Pew expects Islam to overtake Christianity as the dominant world religion in a few decades: https://www.pewresearch.org/short-reads/2017/04/06/why-musli...
I don't have a horse in this game - I'm Muslim after all. But I've experienced London pre-immigration boom and post-immigration boom and I definitely prefer the former, like some of my Muslim peers. The fabric of London has already been destroyed, especially when given the fact that London natives have been priced out of their own homes. Given what I've seen firsthand, and what's preached in the mosques of the UK by unleashed and unhinged Imams, the UK is on track to become a Muslim country in 2 or 3 generations.
https://www.pewresearch.org/religion/2017/11/29/europes-grow...
The most recent birth rate stats I can find is 2005-2010 where Muslims have a birth rate of 3.0 while the rest of the country is at 1.8. Estimates say it's more like 2.5 now, but the current overall UK birth rate is only 1.57 from a quick Google.
https://assets.pewresearch.org/wp-content/uploads/sites/11/2...
The same article also states that the average age for Muslims is much lower than non-Muslims as of 2016, 28 vs 41 for the UK.
https://www.pewresearch.org/wp-content/uploads/sites/7/2017/...
Maybe not in one generation, but in 2-3 generations, the UK will definitely turn Islamic, especially given the exodus of other communities. The irony is that the well-off British are settling in the UAE en masse, a distinctly Islamic country, and driving property prices up there. It's not that much of a concern since local housing is distinctly separated from expat housing.
https://en.wikipedia.org/wiki/Religion_in_the_United_Kingdom
> the UK (who has embraced it and is on the way to becoming Muslim-majority)
.. Seems like we've found a fix for ;) I wonder what's the difference between Muslims in the UK vs Japanese folks.
[0] Figure 2.7 of the Danish Government report "Økonomisk Analyse: Indvandreres nettobidrag til de offentlige finanser i 2018" - https://fm.dk/udgivelser/2021/oktober/oekonomisk-analyse-ind...
Also the Chinese immigrants in question, like many others, usually immigrate seeking a better life, it's a strong self-selection filter. Middle Eastern immigrants of last 10-15 years in Europe are refugees, displaced by wars; they did not choose Denmark (or other Western European countries) because they planned to integrate and to prosper there, they ran there to merely stay alive. They need a lot of help adapting. Even if they are very willing to work, they may lack the knowledge required for gainful employment, and there are only so many dish-washing and trash-disposal jobs.
Those who adapt can make it big; consider people like Freddie Mercury or Nassim Taleb.
It is about race, and here is a commenter saying it explicitly, while you know others resort to dog whistles and other workarounds.
https://news.ycombinator.com/item?id=44091194
The problem with immigration isn't immigrants, it's racists. Immigration has never caused me any problem at all - it's added a lot to my life and my communities, in fact - and I've lived around many immigrants.
> Chinese immigrants are usually an economic boost
Chinese immigrants were hated and discriminated against for much of US history, going back over a century. You could hardly pick a worse example for your claim.
The US is built by uneducated immigrants - including from China - who came to the land of freedom and opportunity. China was a land of extreme poverty and illiteracy for much of US history (something Western countries had a hand in causing, and I'm very glad for people there that they have so much more prosperity now).
(However, the most prosperous Chinese people are in the democratic areas, Taiwan and, until recently, Hong Kong. It's freedom and democracy, not culture and language that matter. Give people freedom and they prosper.)
It's all just stuff fabricated by racists to rationalize their prejudices. Look at the horrors Europe has inflicted on itself and the world due to these prejudices and rationalizations - the most destructive events in human history. Enough.
Racism is the problem.
And then their children turn out to be some of the most productive and contributory to a nation (in my experience), even despite some of the headwinds.
Sorry, I don't buy that argument re: second generation. I've lived and seen it. Perhaps my lived experience isn't representative but I don't see second generation citizens turning to crime or radicalisation in huge numbers. I see them at work, and looking after their families. I fear the brush you are using is so broad as to, sorry, be useless.
"The study has faced criticism over its methodology, as it only studied rape convictions in Sweden. Experts point to the fact that just a small proportion of rapes in the country are reported to the authorities. Jerzy Sarnecki, a criminologist at Stockholm University, dismissed the study as “meaningless” as it only examined figures for convicted rape. “They’ve only looked at convicted people, and they make up a fraction of all rapists,” he told Swedish broadcaster SVT."
Even ignoring the above, I can think of many reasons, statistical and otherwise for the apparent difference. Perhaps you should try using your brain matter to do the same rather than just posting random links.
I repeat: I don't see second generation citizens turning to crime or radicalisation in huge numbers.
The problem with immigration is not the immigrants, it's the racists. They create the pain and horrors and the social tension.
DEI is important, specially Diversity. In order to have diversity, you need to have different cultures. Mass immigration erodes diversity. Diversity exists by having different nations with different cultures, not one culture everywhere.
Immigrants everywhere come with a language barrier. If you live in the US, very probably your ancestors did. It's the same with every first generation from everywhere.
They actually go lots of places. How are there so many refugees in the US (a good thing)? Canada and Mexico aren't places producing a lot of them.
It's a major issue of international law, as people who are anti-immigrants try to insist refugees stay in nearby countries.
Basically the state spends to much money on humans in general. A young qualified immigrant might have a less negative impact than a slightly older German person, but both of them will be money sinks in the long run.
Statistically immigrants in Germany are less qualified than the general population, so they’ll have an even more negative impact.
The only valid solution is to reduce the spending per person, both birthrate and immigration will only delay the problem.
Denmark should be in a slightly better position than Germany since their health system is cheaper.
I need to see some data backing this. Also regardless of stats, many war refugees(the net negatives as told by media) are actually highly qualified but the asylum process and qualification recognition process is eternal. On top of the trauma and uncertainty, they also need to learn a new language, find a new community, patiently go through all the dystopian meetings, cope with their loss of loved ones.
In reality, it is possible for them to be net positive because if things were faster, they would often out qualify the average locals and this also has some effects on wage and market(over supply, constant demand and all the economics).
> they would often out qualify the average locals
That's definitely not true, which is why they want to immigrate to those countries in the first place.
Regarding your other point: https://home-affairs.ec.europa.eu/whats-new/publications/oec...
The liked pdf there gives a good overview.
No one wants to implement it.
And it makes complete sense. The reality is having a child kind of sucks for a woman, and I, nor anyone else, can blame a large portion of women for just saying "eh... no". I would probably say no, too, although it's hard to tell, because I'm not a woman.
Having children was once a boon, because conditions were shit. Now it's a burden. So, people will treat it as a burden.
Either make it less burdensome or revert women. Nobody wants to do the latter, so we must do the former. We have to invest in children, because children are a Nation's investment.
The elephant in the room that is getting some attention is demographic collapse. It’s been politicized, unfortunately, and seized on by strange people, but the fact remains that we’ve stuck our heads in the sand here. The seriousness of demographic collapse cannot be overstated. Social and economic collapse are inevitable unless something (morally licit, of course) is done to boost birth rates to above replacement rates, or kept at replacement levels. Once we reach a point of no return, it will be impossible to reverse course.
There’s a lot working against healthy demographics. We have decades of alarmist, misanthropic, Malthusian propaganda from types like Paul Ehrlich. We have now a hyperindividualistic culture - politically, socially, and economically - that is hostile both functionally as well as in sentiment toward the healthy function of family, and secondarily the community life it produces, as well as mental health). The logic of consumerism does not sit well with family life, because family life is not something that can be monetized. Consumerism relies on maximizing spending of the atomized individual, and in order for that to work, one must maximize the work done by that individual. Family life interferes with the regime of constant spending and the reign of total work. (Ironically, this makes the celebrated careerism of feminism an expression of this all consuming capitalist drive. It stigmatizes motherhood with demeaning labels like “stay-at-home mom” and celebrates the very office jobs that are the stuff of comedies.) Today, we understand everything with reference to the individual, even anachronistically reinterpreting history according to its alienating categories. Some governments have enacted pro-natalist policies, but they’re typically weak, superficial, and ineffective. We’re addicted to patterns of life formed over the last 70 years that we don’t want to let go of. Governments need to take much more serious measures that drastically favor, prioritize, and protect the family, through and through. Good luck doing that in our democratic societies. Addicts typically change only after they’ve experienced a crisis and hit rock bottom, and by then, it may be too late.
Immigration, of course, is no solution. The belief that immigration can fix the problem is itself rooted in the logic of hyperindividualism, where atomized individuals can be replaced by other atomized individuals to achieve net conservation or even gain according to the numbers. Cultural realities are totally ignored. The rate of immigration that a country can successfully absorb is not enough to outpace demographic decline. Exceeding that rate undermines the whole point of using immigration to compensate for demographic decline in the first place, since mass migrations are always harmful to host populations. You’re basically talking the collapse of the host populace and the formation of new ones in its place. Furthermore, immigration drains the populations of other countries, ones that are likely also facing demographic issues, which basically makes richer countries parasitic and callous about the continuity and futures of other peoples, until there are no more populations to drain of people anymore.
I’m an immigrant, and I think at least where I live in USA we need to stop immigration from any random place or of people who refuse to assimilate.
- increase productivity more than how much the workforce/receivers grow.
And if AI/robots eventually deliver, we're soon going to need a discussion about lowering the retirement age to 55 or even 50 if we don't want 30% unemployment anyway.
- indifferent to how much automation you have, people still need to pay for it, for money they don't earn.
And as such, it feels like labelling that “raise taxes” is disingenuous.
Indeed the normal Understanding is not only about increasing rates - look at Switzerland eg.
But again, there's no basis to chose just your three items in particular.
A part of necessities are access to assets.
In the model you propose, inequality in itself will make those more expensive.
They talk abiut the squeeze, if Birthrates increase too suddenly - workers would both have to pay for the elderly and the kids.
If one generation has a fertility rate of 1 child per woman, the next must have 4 children per woman to undo the demographic change.
The people in the “corrective” generation must support their own two elderly parents plus four of their own children. It becomes practically impossible.
The country and the individual has the same problem. But it also goes a generation further.
There was a link on HN recently which I can’t find. It discussed how we are in an unusual time, where kids can often meet their great grandparents. Previously people died younger, so couldn’t. Now people are having kids at an age where it will be unlikely for them to meet their great grandchildren.
I'm not sure that's true - people died younger, sure, but they also had kids much earlier. Even assuming 18 for first child(and it often was earlier than 18), you'd be a great grandparent at the age of 54 - and people have commonly lived that long even in antiquity.
The average lifespans was only 40-something until the 1850-1950 range.
I’m sure plenty lived longer, but the average was terrible.
https://en.wikipedia.org/wiki/Life_expectancy
"While the most common age of death in adulthood among modern hunter-gatherers (often taken as a guide to the likely most favourable Paleolithic demographic experience) is estimated to average 72 years,[169] the number dying at that age is dwarfed by those (over a fifth of all infants) dying in the first year of life, and only around a quarter usually survive to the higher age."
Etc.
https://youtu.be/Ufmu1WD2TSk?si=3mMFke_Rj6b3jWld
The US since then only provides Israel with military aid (most of which is only allowed to be spent buying US-made goods). It’s more of a subsidy for the US military-industrial complex.
Also despite the military aid Israel still spends a much greater share of GDP on its military than most or all other developed countries (so the US isn't subsidising Israel’s unusually high birth rate).
That's a funny way to twist it. US is providing aid to Israel. Billions a year.
US also provides indirect aid, through protection or aid to neighbouring countries (e.g Jordan and Egypt) as bribes so they play nice with Israel.
And who knows, with the way the Iran thing is panning out, you might be paying a lot more if US decides to bomb Iran on Israel's request
If the US starts sending proportional military aid to South Korea (fertility rate of 0.75 vs Israel's 2.83) it will not "fix it".
The US provides and provided a ton of assistance to Israel but there’s a tendency online for people (probably mostly Americans?) to assign credit to literally everything that happens in Israel to US aid.
Israel exists outside of US-Israel politics and not everything (like birthrates) that happens there is because of the US. The US also supported/aided a lot of other countries that didn’t experience the same economic/industrial/technological development that Israel has in the last 30-40 years - some of it really is because of Israelis’ efforts and not just because of Americans’.
That’s one hell of a disclaimer on the statement.
To me it seems rather obvious: you need both the will and the means to raise 3+ children.
In fact, they may majority be of subsistence in which case the entire dollar value of all of their stuff is simply the land.
The catch-22 is that the people you presumably want to be having more children— educated working professionals— have some of the highest social standards for child rearing.
Increase the number of (young female) immigrants
* In some European countries. Many countries, however, have no meaningful avenues whatsoever for tax efficient pension saving. My own "pension fund" is just a regular broker account where I invest after income taxes, and where I have to pay capital gains as usual.
People with good private pensions can decide to retire 5 years before they officially retire.
1. A state provided welfare benefit Or 2. A privately held long term savings/investment account
Would not be very motivational if you work hard your whole life and then you are considered a useless burden once you retire.
The way it usually works is taxation from the current working generation pays for the current retirees. You are not paying into your own account for later (that is a private pension)
FWIW in the UK there are more children in poverty (so their parents too) than retirees who are in poverty. Kids don't vote though...
What's annoying about these debates is that the people who'd e.g. like to see pension cuts are either young and will change their mind later, or they are so rich that none of this matters to them anyway and the latter shouldn't even have a voice in this debate.
The issue is the "triple lock" (state pension rises by whichever is higher of either rate of inflation, average earnings increases, or 2.5%).
While laudable in intent, recently this has led to situations where pensioners are getting bumper increases linked to high inflation, while the younger working age people are getting stagnant wages while inflation shoots up.
This is is why pensioners are on average getting wealthier than the working population. Let that settle in for a moment: year after year pensioners are getting more wealthy than the working population that is financing the pensioner's increase in wealth.
This is universally accepted as unsustainable and deeply unfair on an intergenerational basis as the pensioners - who generally tend to own their own homes and also get various benefits like free transport and extra money for heating costs etc as well as benefiting from more generous policies/working conditions of the past like free university education and final-salary private pensions or purchasing government-built social housing at steeply-discounted rates, lower tax burden - continue to get more and more well-off while the people financing their retirement are struggling with soaring costs, expensive childcare, high education costs, zero-hour contracts, stagnant wages and all the rest.
Yet pensioners complain that they paid their taxes "all their lives" so they deserve to continue getting a bigger and bigger slice of the pie, that they deserve to get wealthier and wealthier than the working population, all at the cost of pushing more children below the poverty line and financially crippling the current workers who have also paid their taxes all their lives (so far).
Eventually with policies like these, you run out of other people's money.
Trouble is that it is a political landmine since pensioners are a big part of the vote so no one has the balls to abolish (or at least reform) the triple lock.
It's mysterious why they haven't done that despite the fact that the demographic problems were known to occur up to 40 years ago. But you see the same thing with housing prices and rents, forthcoming problems were already obvious 20 years ago in every country, yet only few have tried to deal with them in time. Maybe someone else can explain where this inertia comes from, I always found it strange.
Because it goes against their personal interests.
I don't know how this works in other countries. In Finland, it was established decades ago that pensions based on past contributions are constitutionally protected private property. Because people made explicit pension contributions and because the government promised that the future pension would be based on the individual contributions, the government can't alter the deal substantially without a constitutional amendment. If the contributions had been general taxes, or if the promised pension had been independent of the actual contributions, ordinary legislative process would have been enough.
The scale of the problem is absolutely mind-blowing.
Not saying that the math would work out without problems then.
Whether nationalizing the entire US market would be worth it is left to the reader.
What part of the math am I not understanding?
Just look at the countries that have already done this. What share of taxes does their top 1% pay, and does that consistent with your model? Or does the reality show exactly the opposite result?
https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor...
True, but economic growth is very real.
And established elsewhere is this post, people apparently don't want to live like we did 50 years ago, so economic growth has merely been translated into inflated expectations.
It's been translated into far better services too.
Most don't want to so they have to compensate via taxes and higher pension age.
Sustainable population and economic growth at that rate can't happen indefinitely.
Some people have been vocally saying this system in unsustainable long term, just that Europeans governments never wanted to publicly admit this due to fears of loosing elections, so they kept kicking the can down the road.
It’s not really a Ponzi scheme, it is completely possible for the system to be balanced, it’s just very very hard to get people to vote for you if you say they’ll have less tomorrow
This is exactly what happens in Denmark - a balancing of the pension system.
Also,rgis has been planned since 2006 - so it is nothing new.
Hence only doing this for future pensioners will give equal time as reitred.
(at least, this is the core reasoning)
Definition of a Ponzi scheme: A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investor. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk. But in many Ponzi schemes, the fraudsters do not invest the money. Instead, they use it to pay those who invested earlier and may keep some for themselves.
https://www.investor.gov/protect-your-investments/fraud/type...
That's exactly how pensions work in Europe. Replace "Ponzi scheme organizers" by "legally elected governments" and here you have it - you have a whole continent of people believing that their pension is a given. Not everybody may like it, but that's the hard truth.
In the US, people contribute towards a 401K, and choose how to invest, but typically pick up just the S&P 500 - anyway and at least that money is somehow what they have saved for themselves.
But I agree with your statement "it is completely possible for the system to be balanced" - yes a Ponzi scheme can be absolutely balanced, you just need enough participants ...
pensions on the other hand don't have the quality of deception and the value is straightforward - it redistributes wealth from the younger population to the older ones. this reduces the need for individuals to plan their retirements as the state takes care of it. as pointed by another post, you don't need a pyramid here, just somewhat equal proportions of population on each side.
wouldn't you characterise any tax scheme as a ponzi scheme? unemployment benefits, healthcare etc? what makes them different from pensions?
but i do agree that one should not think of pensions as a given. its worth pointing out that there are two types of pensions - defined benefits and defined contributions.
No, not exactly, that's different.
> unemployment benefits, healthcare etc? what makes them different from pensions?
That's certainly contributions I don't like either, because of how this system is abused. But to be fair, unemployment benefits or healthcare aren't a pyramid scheme, because you aren't paying for the previous "investors" - you might get back what you contributed (with a lots of caveats). In the case of the pension system, you clearly pay the previous "investors".
Writing this in an article about how a country rug-pulled it's young citizens is quite amusing.
If that's not deception, I don't know what is.
> you don't need a pyramid here, just somewhat equal proportions of population on each side
Which hasn't been the case in how many years already?
Calling it something else than it is, only to taint the system and its receivers by associating it with a criminal undertaking is bad faith, if not worse.
> the first pensioners didn't invest in the system
I agree with you .. I suppose you're making my point here?
> It's also not a pyramid scheme, since the structure is upside down
The structure would be upside down if the demography was growing as expected - and that's the core of the issue, why governments have to extend the age of the retirement: the burden of the pensions is becoming unbearable relative to the amount of active people.
> there is no recruitment.
No indeed, though if you decide to live in Denmark, you are not recruited, you're forcefully enrolled in this scheme.
> ... to taint ... its receivers by associating it with a criminal undertaking is bad faith
There is no "criminal undertaking" here, the system is simply broken and you're saying things I didn't - I certainly don't blame the current pensioners, nor the active generation working for these pensioners - they are all victims of this system.
They could have easily worked 10 years longer instead of doing nothing but drinking wine all day and/or going out to restaurants in retirement. That is in between traveling to go out to restaurants and/or drink wine.
The boomers scammed us all and aren't done yet. They are going to make sure to bankrupt the entire system with healthcare cost before they go.
I suppose increased life expectancy and fewer young people both contribute to worse dependency ratios.
Living longer doesn’t necessarily mean having more productive years than in the past. We simply have the medical tools to keep people alive even if they can’t much get out of bed.
If pensions were funded by actual retirement accounts, where employees invested money into some state fund and have it paid out for retirement this would be entirely unproblematic.
But the pension system in many EU countries is set up in a way in which tax contributions now finance pensions now. This can only work with a steadily growing economy which continually generates more revenue when more people retire. In some sense it is a literal Pyramid scheme, in which the obligations are continually pushed to younger generations, which have to contribute based on how many pensioners there are.
Especially now as EU economies become weaker this issue becomes bigger and bigger.
Denmark has private pensions like the 401k system in the US.
People can start tapping into these up to 5 years before they are 70.
In reality most people will go down in time and partially tap into private pensions and saving long before they turn 70.
This is opposed to other European countries, like Germany, that does not have these private pensions, but only retirement insurance.
Just as in Germany Denmark funds it's pensions through taxes, Germany additionally funds them through employee contributions.
In Denmark you have ratepension, which truly is an investment account and not an insurance product.
Their retirement savings can be in public company stocks instead of government guarantees but that only works if there are people willing to buy those stocks (ex: younger people saving for retirement).
In a world with forever imploding consumer aggregate demand, there is no safe asset.
Productivity gains will also be swimming against the stream because scale advantage will deteriorate in all sectors.
And that's fine because it means consumption is lower too.
Whatever you accumulate for retirement (cash, stocks, gold, state pension points) it only represents coupons for your share of the economy of the future. Details may differ but fundamentals are the same: it a promise that the future generation will share some of their yield with you.
You're talking about a system of pension by capitalization, like in US, which comes with its own problems.
Namely that if you reach retirement age during a crash like in 2008, you're screwed. You have to work 5 more years hoping the market recovers in the meantime, or retire anyway and get way less than you put in.
Hopefully US people realize that this is also how US public pensions (social security) actually works.
Setting aside the issues of declining birth rate for a minute, this seems like a reasonable adjustment to the other factors?
Retirement age has not gone up since it was created in 1940s. Not crazy to raise it a little.
Quickly looking at Denmark articles, it seems they’re raising the age to adjust to life expectancy increases as well.
I don’t see this a sign of the system failing.
There was a steady rise in life expectancy at retirement age in the UK until 2020, then something happened and it's fallen significantly. My guess is that it will rise rapidly over the next 15 years and this will be regarded as some sort of triumph for the public health system (unless there is another pandemic of course).
Since 2010, the retirement age for women has raised from 60 to 65. Bringing it in line with the male retirement age.
See https://www.thetimes.com/money-mentor/pensions-retirement/st...
The age (for both) is gradually rising to 68.
Source https://www.gov.uk/government/news/state-pension-age-review-...
The raise to 68 will happen, but it has not happened yet. So, I think to frame my comment as “simply untrue” is disingenuous at best.
Commercialize GLP1s.
Spend it on wars.
The policy for retirement age is related to when society sees fit to sustain someone that does not work. I think it has more to do with how the society sees the elders and what it can afford than to the goals of specific individuals.
My dad just turned 78 and has really slowed the last 5 years. Longer life says little about quality of life.
I've been traveling for holidays every year since I was 25 for at least 3 weeks every year, loving it so much. First it was backpacking, now it transitioned into a bit more luxury as I got older.
You don't know if you'll be hit by a bus next year, retirement is a silly milestone to focus on.
There's the flip side if the coin though: old people are healthier in Denmark (vs US for example [1]) due to the social welfare system. Well, that system needs to be funded. With the aging population, the costs are rising but contributions are (relatively) declining. That's why there's a push for higher retirement age. It's either this, or defunding the social welfare programs, or immigration. That last one isn't a viable political option in Denmark at the moment.
[1] https://www.euronews.com/health/2025/02/05/older-people-are-...
That people are living longer is why the system is failing. It's an interesting thought experiment to consider whether any country would introduce a state pension now knowing how much they cost.
Or some may say it got outdated.
It was started at times when the life expentancy was low. And it was given at age above the life expentancy. And in the beginning not to everyone. The retirement age got lower and given to broader set of population gradually. These moves made governments popular, so it was no brainer to introduce, on the expense of future generations.
Birth rates that can maintain the economics of relatively low retirement age could not be sustained without destroying the planet. Actually has to be reversed still as it went too far already and deteriorating as we speak, especialy with the ongoing large increase in the overall life quality - causing decreasing birth rate alone - and healt. The system was destined to fail. But how to take away rights? It is much harder than giving, especiallly when the adverse effects are for current voters, not future generations?
So the necessary steps are postponed, postponed, postponed yet again, for many decades, taking about necessity in many forms, meanwhile filling bigger and bigger holes in the budgets, through borrowing, making the problem worse, again for future generations. Very few countries do tiny adjustments, and even those are met with huge protests mostly.
I wonder what the future holds. Painful adjustments or more painful collapse later in some form.
In some rich countries people spend now more years of their life out of work than in work because of much longer education and much longer lifespans. If you want to keep the same social standards, all other things being equal, you need to raise the retirement age.
Of course, those last two sentences are tongue in cheek.
The real problem is that certain segments of society are not compensated for their labor at a rate that would allow them to retire early, and may even have to work beyond retirement age in order to supplement their stipend. Worse yet, these people often work in sectors that offer few affordances for them to maintain their health into old age and may even push them into living conditions that are detrimental to their health (assuming their job isn't detrimental to their health in the first place).
Ideally, people would be able to retire when they want (within reason). The reality is that some people can retire at a relatively young age while others don't really have that option.
The Japanese faced this earlier and harder than Europe, with about 30% of their population being past the retirement age. They increased their productivity very significantly, but it's still not enough, and a lot of older folks in Japan keep working well past the retirement age, sometimes even re-hired by the companies from which they had retired.
Japan is very illustrative in this regard. Young people are forced into unaffordable cities, where they often live in cramped shoebox-sized apartments. While beautiful spacious traditional homes are decaying just 2 hours away by car.
What can help? Promote smaller cities, by focusing on making smaller cities more attractive for employers. This is already happening with the remote work, and it helps: https://eig.org/families-exodus/
How to make smaller cities more attractive? Put a stop to densification of larger cities, and tax (or cap-and-trade) the office space in dense areas.
This might be true, but could be for many reasons. There's not enough info in that to promote a specific response.
The thing is, there is not much you can change in peoples' behavior. So your only option is to stimulate the behaviors that you want.
The unaffordable housing cost is entirely an artifact of urbanism gone wrong.
If you go outside of big cities, land price is not an issue. At all.
Barrie is still in the general Toronto area, so it's expensive. Sudbury further north that is definitely not a part of Toronto anymore, has very reasonable houses for ~$400k, or 5 years of average household income in Ontario. This is well within the normal "affordable" range, so a 20-years mortgage will be around 30% of income.
The problem is, people _can't_ live in Sudbury because there are no jobs there!
Or people in big cities have plenty of opportunities and interests than just to have children.
People often want to live in big cities due to social reasons, not just due to employment opportunities.
But the current drop below the replacement rate is all due to increased density. If you look at the stats, the urbanization percent stayed flat. However, more and more people are moving into a smaller and smaller set of large cities.
Correlation is not causation. People happily raised children in dense cities for centuries. It was only when the postwar regime of making new housing illegal took hold, and housing prices inevitably spiralled out of control, that they stopped.
> Young people are forced into unaffordable cities, where they often live in cramped shoebox-sized apartments. While beautiful spacious traditional homes are decaying just 2 hours away by car.
Those old houses look great in instagram photos but they're not very fun to actually live in. Young people are rightly prioritising places that are good to live instead of the boomer square feet fetish.
> Put a stop to densification of larger cities, and tax (or cap-and-trade) the office space in dense areas.
Killing the most economically productive parts of the country is not going to magically make other parts more productive, it's just going to destroy the whole country's economy.
The causes of the population decline are a) women marrying later, or not marrying at all, because they have the option of a career and prefer that b) families that want to give their children a good future having few children, mainly because of the cost of education. Those are the things you need to address if you want to change it.
London is an example of such a city. Its population in 1750 was 750000 people. It was not a "large city" at all by current standards.
> Those old houses look great in instagram photos but they're not very fun to actually live in.
Oh, I agree. However, for the price of an apartment in Tokyo, you can build a _new_ home with all the modern amenities.
> Young people are rightly prioritising places that are good to live instead of the boomer square feet fetish.
Yeah, like "microapartments" where you can cook food while sitting on a toilet. Very well suited for hikikomori, great for raising 3 children!
> Killing the most economically productive parts of the country is not going to magically make other parts more productive, it's just going to destroy the whole country's economy.
It won't kill anything, it will just move jobs out of large cities. We've already had a "dry run" of this during the pandemic.
> amilies that want to give their children a good future having few children, mainly because of the cost of education.
Europe has free (or cheap) education. Yet birth rates are even lower than in the US.
> Those are the things you need to address if you want to change it.
Then why people moving out of cities have a greater fertility rate?
And its population in the 1930s, with a healthy fertility rate, was 11 million.
> for the price of an apartment in Tokyo, you can build a _new_ home with all the modern amenities.
Maybe - bear in mind that building costs are much higher out in the country. But assuming you build a big house, what would you do with it? I guess all the cleaning will help make life less boring.
> It won't kill anything, it will just move jobs out of large cities. We've already had a "dry run" of this during the pandemic.
The pandemic did a lot of economic damage, and many jobs stayed in the cities or are rushing to return there now.
> Europe has free (or cheap) education.
But much stronger womens' rights and correspondingly low marriage rates.
> Then why people moving out of cities have a greater fertility rate?
In Japan? Maybe because of all the cash subsidies for moving out with children.
How practical is raising kids in a 20m2 studio? Especially if you've got multiple. I'd bet not nearly as practical as in a house. Plus the recent trend of building lots of smaller apartments instead of a bit bigger and way more practical ones.
The other way around is more difficult to quantify, and a lot of demographic studies look at immigrants from poor countries.
They don’t speak English and I’m not sure if they will assimilate well. I already see street vendors, trash everywhere, and other 3rd world behavior in some parts of SF.
I’m an immigrant from 3rd world. It’s pretty sad to see here.
I don't see how even that helps. What you need to fund basic welfare is a large supply of basic goods (shelter, food, medical care). The basic problem with retirement of a lager generation than subsequent generations is a lack of labor/productivity. Those basic goods don't really respond well to just throwing money from tech companies/rich people at the problem, you need people to work to provide those goods and services.
The only way taxes help is if they discourage "unproductive" economic activity (SWEs and financial planners) so much that those people start working as nurses and construction workers instead.
This system was working back in 1860, but it is a Ponzi scheme in decline for the past 50 years. And there is no way out, most people rely on state pensions to live after retirement; it is the perfect trap.
Ha. Total pipedream. It is easier to imagine the end of the world than to imagine the end of our current economic system.
Well yeah, because it's difficult, taxing, often traumatic work that pays the same as any other nursing job with a higher QoL and social status. And even then they're pushing out all the actual nursing staff that pays well in favor of MAs/CNAs who get paid like shit.
I personally don’t think wages always correspond to how essential a job is, but for the sake of the argument let’s pretend that wages match the necessity of a job, its difficulty, educational requirements, etc.. In this case, I’d expect that we would see people move to jobs that are more essential than their prior job. I think this is more complex that just “poaching”.
I really don't mean to get into the nitty gritty details - I'm not an economist and I'm not providing solutions, just stating what I see as the problem. I believe that we have enough resources, and there are issues getting those resources to where they need to go.
Example: Assume we do have a shortage of elderly care workers. Why is this the case? Could this be fixed by increasing their wages? Then that implores the question of who is paying for these increased wages, which is the question I'm not answering and I don't know enough to answer.
I just don't really believe that keeping the birth rates high is the answer to this economic problem. It might be a solution, but it's more of a band-aid than truly facing the issue. If you have a inefficient engine you can either figure out how to produce more gasoline (babies), or you can figure out how to produce a more efficient engine.
A truthful ad for working in an old folks home in the US would be, "slightly over median wages, but with inflexible and unreliable schedules, rampant industry wide exploitation of workers and their rights, likely multiple ownership changes of your place of business, caring for potentially deranged and violent individuals, high non-refundable monetary investment up-front, no guarantee of residency availability"
In the places with high fertility rate, you will almost surely observe joint families. I'm from India where we have such demographic variety that you can see adjacent areas with completely different fertility rates. In one, you will see old-style large houses with courtyards and 15+ people in them living as a joint family. Invariably these people have more kids. But in the next town with more nuclear families and modernish apartments, you will be lucky to see 2 kids per family. [1]
This is what births the secondary economic incentives which are mentioned a lot in popular discourse. For example, if you're already living in a house with 15 people your financial realities will require a similar number of people in the next generation to continue the same lifestyle.
[1] Wealth is not a confounding factor here. The specific two areas I have in mind are both more or less equally wealthy, one has folks running a coconut business primarily and the other is a small town with the usual assortment of office jobs.
So … probably most straightforward solution is to update local zoning laws to encourage a more communal style of living. Not communes but more along the lines of suburbs-as-village.
Having a child has a significant impact on your professional career (women in particular). Even in countries with great parental leave, like Denmark, the absence still reduces the years of experience you would otherwise get. Once they are "ready" for a child, they are in their late 30's and barely have time to birth one or two babies and would probably not have the stamina required to take on more.
The social pressure of raising the perfect kid with multiple activities in their "spare" time is much higher today and require more from the parent.
Ideally, people should get children in their early 20's, when they are physically more fit to handle the pressure. Unfortunately the current education system does not combine well with young parents. The government would need to integrate child care in colleges so that the parents have somewhere to place the children while studying.
With a growing population of pensioners and a declining population of taxpayers many EU countries are walking towards a future where it is abundantly clear that the state can not finance pensions. Especially when at the same time their companies loose their economic competitiveness.
I do not believe that raising the retirement age in 15 years will be of any major help here. And it seems especially outrageous for the younger generation.
People also focus on a fixed percentage being returned while ignoring the long term increase in productivity and people’s standards of living. In real terms people in 2025 get way more out of pension systems than people did in 1925, that’s as central to the problem as any changes in lifespan.
Historically payouts also benefited from rising productivity and populations but those assumptions are breaking down.
Let's see. If you pay 15000 euros per year for 40 years, and get 5% interest, that's 1,800,000 euros at retirement. Even if you held that in cash, a 30,000 euro/year withdrawal would last you to 130.
Assuming full employment every year is a mistake. Also, 5% interest above inflation is an unpredictability good return, especially if you’re assuming it’s a safe investment. The stock market has mostly done well over the last century but start in 1969 and the 40 year return on the S&P 500 was 4.2% after inflation. Things could be far worse over the next 40 years, the 20 year S&P returns have been as low as 0.6% over inflation.
Running the numbers assuming zero taxes and fees is a separate issue.
In US SS your spouse can collect benefits when you died at 22 if you had a kid together, you also can collect benefits if your disabled. There’s obviously not 1.8 million in your retirement account to fund such things at 22. Similarly the payout for a married couple is 1.5x if only one of them have ever worked because it’s not a requirement account it’s a social security program, and then 75% if the worker dies. No idea how your system works, but it’s common worldwide for pension programs to do such things.
The increased medical costs as we go, however, might actually make it worse, faster.
The current system is just not broken but unfair. In many EU countries, people are not contributing for themselves, but for the previous generation being currently retired. In turn, it's supposed that babies born today will work for the pension of the currently active generation. This pension system is nothing else but a pyramide scheme and that scheme is now breaking due to a demographic issue - just like a traditional pyramide scheme would break because there are not enough participants to that scheme ...
Or is it just trying to claim moral high ground by cherry picking?
Industrialized countries unable to accommodate and become appealing to a sufficient yearly inflow of migrants to rejuvenate the work force are doomed. The population statistics are crystal clear about that. That's just how it is. Those countries could have changed their pension systems 30 years ago to avoid this problem but didn't.
Other than that, I don't care what you personally mean by "...are positive" about a whole group of people. Making such statements about hundreds of thousands to millions of people is an obviously gross generalization and not at a level worth discussing.
„Work“ is not always beneficial-to-society work. Especially if you have a good safety net. Even in my country break-even to pay more in taxes than you get back is above minimum wage. I'd expect it even higher in Denmark.
I don't know which are more doomed. Countries who don't „accomodate“ immigrants, or countries who let them in and fail into assimilate.
> countries who let them in and fail into assimilate
There is no meaningful definition of "assimilate" in this context, at least not one that would be desirable. Immigrants have to follow the law like citizens and need to pass a language test. That's it. Anything beyond and above that is personal conjecture of the people who demand it, as there is no broad common denominator between the born citizens of a country either. You shouldn't demand of others what you cannot achieve within your own citizens (neither would any homogeneity be desirable and healthy for a country, but that's another matter).
We should not see people as economic unit who just produce value. People and society in general is much more complex system.
One common denominator in vast majority of europe is not being a muslim. And many of issues with immigration does raise from this fundamental difference. And I'm not saying to not let in any people from muslim countries. But they should denounce their religion the moment they get work permit. And don't raise their kids accordingly.
But, I just looked it up again for this comment and that same rule says "No changes to social security" in reconciliation. It is specifically called out as forbidden to touch via reconciliation unlike almost every other program. So, maybe you are right, it will just be ignored because it doesn't seem possible to quietly change.
If this budget hits the PAYGO limits, which is basically guaranteed, that will trigger automatic cuts to Medicare, so they can backdoor cut the program without anybody voting for that.
Voters over 62 make up >25% of the midterm vote.
By 2030 - that number could easily be >30%.
Look at all these people around you in their forties who are still renting. They are basically too late to buy. They will be "forever renters". This means they will have to work until death, as their rents continue to rise when their peers who owned homes took their downsizing premium and lived off of it for a few years.
What's crazy is the number of grown adults who think their 401ks will magically grow to fill the gap.
You may argue that the the value of the house will appreciate well in a good market, but there is nothing stopping you from taking the money you saved by renting and putting it in an appreciating asset.
[1] https://www.nerdwallet.com/calculator/rent-vs-buy-calculator
a homeowner in that scenario can sell their home; a renter is in trouble
You just have to give up on the Santa Monicas, San Franciscos, and Manhattans of the nation. There's plenty of affordable housing outside the top tier cities, and modern tech has made it easier than ever to work from practically anywhere on the planet.
The only people in their 40s I know of who are still renting that I would consider "forever renters" are being extraordinarily undisciplined with their finances and spend what they could be saving towards a down payment on credit card debt they self-inflicted.
What ended up happening is we rebalanced the program based on a lot of positive changes and used a huge ‘surplus’ to subsidize government borrowing, and nobody wants to adjust for any negatives ever.
Once Boomers pass through the system and start dying off in significant numbers over the next 10-30 years there won't be any size differences between successive generations nearly as large. Gen X is smaller than Millennials, then Gen Z is between Gen X and Millennials in size, and the current generation is projected to be around the same size is Gen Z. This should make it considerably easier to keep the system working.
Polls show [1][2] that this approach (flat rate + 1% gradual rate increase) is the solution voters prefer by a large majority regardless of party affiliation when presented with all the solutions that have been proposed by politicians and experts.
Generally whenever Democrats in Congress introduce bills to address the problem this is the approach they go for, although sometimes they talk about keeping a lower marginal rate for people making between $176100 and $400000, like this:
Republicans in Congress do not really have a coherent approach to this. There's a powerful group in the House called the Republican Study Committee, which is a large conservative caucus of around 190 members (~85% of House Republicans). They are the ones setting Republican policy in Congress on this issue.According to them there are only three ways to fix Social Security: some combination of (1) raise the money it takes in, (2) reduce the amount it pays out, and (3) make up for any shortfall by paying some benefits out of the general budget.
They also say that #1 and #3 are off the table. Their proposals generally go for #2 via raising the retirement age. That does buy some time but not much, and runs into the problem that the Republican Party Platform says (caps in original) "FIGHT FOR AND PROTECT SOCIAL SECURITY AND MEDICARE WITH NO CUTS, INCLUDING NO CHANGES TO THE RETIREMENT AGE", and Trump also keeps saying that which doesn't leave them any options.
[1] https://www.aarp.org/social-security/survey-raising-taxes/
[2] https://www.nasi.org/wp-content/uploads/2025/01/NASI_SocialS...
So this raising of the retirement age will affect a huge portion of workers and 70 is OLD to be working full time for all but the most relaxed jobs. Most older folks I know have know being dealing with multiple chronic age related illnesses well before 70.
It's a financial goal that is literally based on how long you plan to live, aka, your age.
Let's say I have €100.000 in the bank and that's two years of expenses based on my budget. Can I retire tomorrow? Well, what's my age? and what X do I plan to add to my age to determine if that amount of money is sufficient to retire?
In 1930 Keynes projected that by 2000 their grandchildren could work 15 hours per week¹. Now the projection is that we will work more and longer in the future.
And what is this labor supposed to even do? How much of even current work really increases wellbeing?
Graeber's thesis of bullshit jobs becomes increasingly more convincing: work isn't about production, it's about social control².
[1] http://www.econ.yale.edu/smith/econ116a/keynes1.pdf
[2] https://strikemag.org/bullshit-jobs/
That said I agree we should be further ahead in paving a way to paradise.
> Now it is true that the needs of human beings may seem to be insatiable. But they fall into two classes -- those needs which are absolute in the sense that we feel them whatever the situation of our fellow human beings may be, and those which are relative in the sense that we feel them only if their satisfaction lifts us above, makes us feel superior to, our fellows. Needs of the second class, those which satisfy the desire for superiority, may indeed be insatiable; for the higher the general level, the higher still are they. But this is not so true of the absolute needs -- a point may soon be reached, much sooner perhaps than we are all of us aware of, when these needs are satisfied in the sense that we prefer to devote our further energies to non-economic purposes.
How would he anticipate houses 50% larger than his generation's, or cars with twice the horsepower at four times the gas mileage, or universal air conditioning (as few houses in the US lack air conditioning now as lacked running water in 1950) or a monthly bill for Internet or proles being able to afford intercontinental flights more than once in a lifetime?
Keynes was quite damn good at anticipating things.
Yes. That's math, the rule of 72. At a 2% growth rate the economy will be 8 times larger in 108 years, more or less. The rate is a bit higher, so we're a bit over 8 in the 95 years since that's been written.
> Keynes was quite damn good at anticipating things.
But that's not anticipating things, that's projecting an existing growth rate out for another century. Improbable really that it would neither rise nor fall, and one of the reasons it hasn't fallen is that we didn't cut our work week to 15 hours. So the only thing (in this context) that he really anticipated was wrong.
Couldn't they, having the same standard of living as in 1930?
Personally I think we should revert to the earlier system, where you are free to retire as soon as you want on your own money, but if you want the state (=other regular people) to fund your lifestyle, you need to be no longer fit for work
If I remember correctly, Denmark even removed a holiday recently. So work more days a year as well.
That's the problem here. That a few people reap all the benefits of this, while the rest of us toil.
Reinvested to increase future productivity
I wonder what a good answer would be here. Intuitively we are increasing productivity in activities that does not increase social welfare. Take corporate lawyering, marketing as an example.
https://inequality.org/facts/wealth-inequality/
Etc etc
It seems that significant amount of productivity gains are lost because of activities that profit from deception and counter activities that accounts for them.
Debt servicing.
I have no specific figures to back this up, but my assumption is that as we become more productive, more credit is made available, which leads to bigger debts and asset price inflation. Because of the asset price inflation, the debt is not necessarily used for productive purchases but, for example, to pay more for existing things - the obvious one being a home. The productivity gains are therefore claimed by creditors.
It would be interesting to see how well productivity increases and debt growth (esp. private) correlate.
Its an intrinsically anti-human system thats starting to need less and less people. How these surplus people are dealt with isn't going to be pretty... Hopefully it results in the actors, being human and all, having a social revolution and pivoting away from it.
Those who own the capital. The top 10%-1%. [0]
[0] https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Ce...
https://wtfhappenedin1971.com/
To the top 1%. Technology advances rapidly, but work hours don't decrease.
This projection came true. You can live with a 1930s living standard while working 15 hours per week at a median wage. However, nobody wants to live at a 1930s living standard. It turns out that in aggregate people prefer to spend productivity gains on conveniences and higher standards of living than on working fewer hours.
Maybe not if you want to own a home. Asset price inflation is real. If you already own a home, sure.
- The productivity growth really has had incredibly strong deflationary effects. So much more, more diverse, tastier and healthier food for example, for so much less money.
- The growing affluence has really created incredible opportunities for scavenging from the waste stream. A practical example. About half of the food I eat is leftovers from a nearby school. I'm proud to be saving good food from going to waste _and_ it lowers our expenses quite significantly.
Whatever people save for retirement, cash or stocks or points, it only facilitates the said exchange, it doesn't somehow replace or alleviate it. It only works if the next generation exists and is prosperous enough to share their income.
If you think about it, there are fewer and fewer jobs that are genuinely useful.
I know it's a difficult topic, but I can't shake the feeling that we need some sort of government intervention in order to reorient the economy towards activities that actually benefit us.
Productivity gains are kept by the owners of the institutions as profits that made that productivity possible. Do you think YOU will work less once LLM tech is deployed at scale? Of course not, your company will pay you the same and expect the same work. Every company out there will do the same. They will reap the productivity gains.
Keynes was almost right. He underestimated the ability of future generations to consume conspicuously. Also, the need for many to fit in by working, but I digress.
Many don't _have_ to work more and longer. I'm speaking of a large class, very much overrepresented on HN, of smart, healthy westerners with no dependents to care for. We have only one major problem. We live in this bubble nudging us towards conspicuous consumption - gently or less so.
My job closely resembles Keynes' 1930's prediction. Sometimes I work (much) more. Not because I need money, but because the job is interesting. Interesting as in, me learning, contributing something positive to other people's lives, growing my family's financial resilience and robustness, or just enjoying the flow.
Extending the retirement age doesn’t really help the situation much, as you need younger and cheaper pilots to fulfill the roles of pilots who are retiring.
The problem is, becoming a pilot takes a fair amount of time, over $100k in training fees, low pay for a while until fully certified with hours in, a very mobile lifestyle, and now you are subjected to physical as well as mental demands of the job certification standards.
(it has something to do with profit)
https://en.wikipedia.org/wiki/Latin_American_School_of_Medic...
A recent form of profit seems to be offering cheap treatment/medical tourism
https://www.cubamundomedico.com/en/university-of-medical-sci...
Seems impractical for USians, though.
When you try to build a society around human needs instead of capital needs, you end up with different priorities. It's that simple.
If anyone thinks they're making the big bucks and accumulating "soft power" by training a bunch of doctors then selling treatments to Americans for cheap, I'm not sure they can be helped.
I wondered about why there were almost always cuban medics, doctors, nurses etc. in action, when there has been some larger catastropic event in the world, and you could see them in the media.
Why is that, I thought? That doesn't fit being sanctioned by the US(and vassals), being poor in general, and so on.
That's how I became aware of ELAM.
And made up my mind the way I described. Can't help it :-)
I think the word for that is capitalist realism. You cannot imagine a motive beyond calitalist logic, but that doesn't mean nobody else can.
https://en.m.wikipedia.org/wiki/Capitalist_Realism
I'd feel offended if the YOU in "You cannot imagine a motive beyond calitalist logic, but that doesn't mean nobody else can." was addressed to me, personally.
Or was it just meant as a general description of the concept?
It's easy to have really good health outcomes at really low cost if you just fabricate the data. It's easy to export lots of doctors if you force them to work abroad, force them to pay most of their salary to the government and hold their families hostage to ensure compliance.
https://academic.oup.com/heapol/article/33/6/755/5035051
https://www.hrw.org/news/2020/07/23/cuba-repressive-rules-do...
Much less so to the doctors themselves, which frequently have to work in what amounts to conditions of indentured servitude. And they have no other option, as working as a domestic doctor in Cuba typically pays less than being a taxi driver.
To be honest, I'm not convinced of your explanation.
[1] https://jamanetwork.com/journals/jama/article-abstract/26132...
[2] https://hbr.org/2020/03/the-problem-with-u-s-health-care-isn...
Without NPs and PAs, I'm sure there would be a shortage of healthcare providers.
Well, guess what? I now also have rationed care. I have to wait six months just for a colonoscopy, plus I pay twice as much for the privilege!
Which obviously means we need 2-3x as many.
1 out of every 7 medical schools currently active in the US was founded in the year 2010 or after. That's a veritable bonanza in medical school creation, facilitated by the AMA.
It can have its place, i.e. a way to balance bargaining power with the employer. It’s inherently anti meritocratic though.
In some cases it’s not about merit or about limiting supply however. In some cases it’s impractical to test someones work continuously, so instead it becomes honor based. That is, you are expected to go through an elite track and succeed in an exam once and then you are good for life unless you commit fraud or show gross incompetency.
https://freakonomics.com/podcast/is-professional-licensing-a...
Even the cost of PPL, the lowest license on the path, is around $10,000 while the ultralight (European)/sport pilot (US) is over $6,000. From that you need CPL (commercial), multi-engine, complex aircrafts, instrument rating (bad weather or night) etc., that takes time and money most people cannot afford.
The obvious one that comes up in every discussion is thinking that unions will protect their jobs from being outsourced to other countries. People like to layer various more palatable explanations on top of this to make it sound better, but when you ask them if the employees who receive the outsourced jobs should get the same union protections you usually get their real motivation: They want to keep the jobs local to their own market and exclude foreign labor supply in order to improve demand for their services (and therefore their leverage, and therefore their own wages)
It gets interesting when different demographics start imagining that their ideal union would protect them from other demographics: Commonly, older people like to think of unions that will protect them from losing their jobs to young people.
Then when I’m working with college students and they start discussing hypothetical unionization, they come up with ways to think the union will give them more jobs by protecting them from the old people “hoarding” the jobs. (Sorry, that’s the least likely outcome for a union)
What’s most interesting is that the people I know who are in unions (non-tech industries) don’t hide the fact that decreasing labor supply to increase their own demand is exactly what they expect from a union. The first time you hear someone complain that a non-union worker is “taking food off their table” by simply doing their job you realize that it’s not as simple as Unions versus Corporations like we’ve been led to believe. The Unions are advocating for the people in the union, not workers everywhere.
Bear in mind it's completely normalised for companies to charge higher prices in one market than another, and put barriers in place to make sure customers in the more expensive market can't just pay the lower price. So all the union is doing here is bringing it closer to a level playing field.
Australia doesn’t have enough money for that? No problem, just make everyone work longer.
As an individual if I don’t earn enough to cover my spending I have two choices.
1. work more
2. Spend less
In all these discussions we never see politicians do anything about spending less, they just throw us under the bus to work more, while of course exempting themselves.
I also wonder what it would look like for the government to encourage (or even facilitate) "jobs for seniors" that only become available to you after you turn 60. They could be jobs that are, by design, low-risk, low-physicality, but medium-high mental stimulation.
Denmark’s population was 2.4m-3.5m in that period (https://en.m.wikipedia.org/wiki/Demographics_of_Denmark)
Wikipedia cites Danmarks Statistik for the population numbers, the official government statistics.
The 2.4m is in 1900, 3.5m in 1930.
Appreciate this is a controversial view so interested in hearing why I'm wrong so I can stop holding it. I think retirement should just be replaced by disability welfare to be honest.
So, Denmark raising the retirement age is kind of a big deal. I imagine the Danish might be less than thrilled about that.
Isn't 19th century covered by history classes anymore? :/
The state then being kind enough to give you something back after 35-40 years of contributions is expected.
A two-retiree couple who contributed at the tax limit for long enough would get $122,592 in Social Security benefits in 2025. Not beachfront living in the Hamptons, perhaps, but not cat food eating money either.
https://www.gov.uk/government/speeches/adding-years-to-life-...
Is a lot easier than "rejuvenation", and a lot more attainable. And also something we do throw R&D money at.
People are significantly more productive than say 50 years ago due to technological advancement. So where is all the money going?
I am no economist but it is my understanding that all this extra money goes to the rich because they've entrenched themselves in positions where they can extract a portion of a person's income with no recourse.
It's not normal that a single person can legally own tens of apartments and get a third or each tenant's salary without providing any value to society. It's not normal that companies can own residential properties, they have no use for them other than extracting money from people.
I recall danluu blogging about how multiple times he made code fixes that saved the company more than his salary just in electricity. What I see is an incredible technical achievement but also I see how he's being exploited - the money saved is value he directly provided to society, yet he sees none of it. Where does it go? To people who are already rich.
People have far better lives considering all the things available to them compared to 50 years ago. Most people would not want to live life like how people lived it 50 years ago.
> It's not normal that a single person can legally own tens of apartments and get a third or each tenant's salary without providing any value to society. It's not normal that companies can own residential properties, they have no use for them other than extracting money from people.
This is definitely a problem but I don't think the only one.
Over the past decade life expectancy in developed countries first plateaued, then declined.
Yes, largely due to the pandemic, but that plateau was also the beginning of decline in some places.
Certainly. Planned obsolescence and devices being impossible (or illegal) to repair is another. If a device costs 20% less but lasts only half a long, buyers are losing money because the profits go to the rich more often.
Food has ingredients and an expiration date on the packaging as required by law. Expected lifespan should be required for petty much everything.
Because it certainly does not go to the people doing actual work producing it.
It is not that it is hard because it is a controversial subject. It is hard because it is not one problem. To develop rejuvenation you would need to tackle hundreds of very difficult problems, both physiological and neurological, which individually, would represent solutions to critical conditions today (diabetes, dementia, ataxia, arthritis, many types of cancers etc etc).
I definitely don't think we have succeeded in "invented" this, but it surely has happened slowly over time. People in theirs 60s today are surely sharper than they used to be, with less chronic physical ailments.
But the end results is people living longer, and the solution still ends up being pushing back the retirement age.
Well, I guess you're not required to have a private pension scheme. But most jobs come with one, most unions enforce it.
I had one when I was sweeping the factory floor once a week at age 15 -- that was ridiculously because it all disappeared into administration fees.
But the answer is yes, of course you can. It's a free country -- assuming we're not annexed by the orange monkey.
How do you think the US got its population?
I am pretty sure that immigrants pay taxes.
You're doing a great job satirizing the extreme positions and hateful attitude of nationalistic xenophobes.