9 ms·

This is really scary. The whole western world is in for a rude awakaning in the coming years with regards to retirement. Retirement is the golden carrot dangle

This is really scary. The whole western world is in for a rude awakaning in the coming years with regards to retirement. Retirement is the golden carrot dangled in front of us for all our working lives, an embodiment of Protestant work ethic - "work hard and you will be rewarded in the end". However, very much has changed since retirement and pensions were designed. I can't find a good source, but (in Sweden) when pensions were introduced after WW2 people worked from their late teens until they died (40+ years of productivity), produced 3 or more children per woman (good population age distribution, the classic "pyramid") and the average lifespan was 64 years (1 year before retirement). Nowadays, many of my peers don't get a "real" job until their early/mid-thirties (work for 30 years of producitivty), produce 1.7 children per woman if they reproduce at all (leading to a top-heavy population where fewer and fewer young people must support more and more old people) and life expectancy is much, much higher. Now, these things are in of themselves good, but they break the original design horribly. I really, _really_ hope that we can cross the chasm to a robot-centric/base-income society before it all breaks down. EDIT: Found this after posting: https://en.wikipedia.org/wiki/Pensions_crisis https://en.wikipedia.org/wiki/Pensions_crisis

deleted 9y ago
[deleted]
morecoffee 9y ago
> The whole western world is in for a rude awakening in the coming years with regards to retirement. No kidding. Who will pay for all the people who didn't save? The people who did. I have very little expectation of keeping most of my money as I get older.
- frisco 9y ago
  > I have very little expectation of keeping most of my money as I get older. Welcome to the world of Bitcoin and Monero.
  - googletazer 9y ago
    Incredible that you are so heavily downvoted. Just shows the level of fear and disdain that even technical people have towards cryptocurrency.
- sddfd 9y ago
  Exactly and now tell anyone that it was ever a good idea to not provide basic pensions for everyone and make payments mandatory. If that had been the case then at least everyone had paid at some point.
  - varjag 9y ago
    This idea is not without drawbacks. Mandatory pension systems have a history of being wiped out by extinction events both governmental (USSR et al) and corporate (Kodak and other midcentury megacorps). It's at least something I guess, but retirement planning is a really really long forecast horizon and is inherently risky.
    - blubb-fish 9y ago
      In Germany the retirement system is far from perfect - but it at least keeps (most) people from being homeless or starving. The lack of universal health insurance in the USA is basically traceable to the same societal shortcomings. Why should a rich banker support with his premium health insurance for a woman who gets pregnant - as he's not getting pregnant anyway. That's a very egoistical way to look at communal cooperation but at the end of the day the reason for why ACA is being sabotaged by many politicians.
      - peteretep 9y ago
        But but ... that's socialism! And socialism is bad because ... USA USA!
        blubb-fish 9y ago
        don't know why you're downvoted - your comment is not constructive but an ironic reflection - I think that's totally fine.
      - jazzyk 9y ago
        I am far from rich, and not a banker. I assume by "woman" you meant someone who is at or below poverty line, if so, I (and most people) don't have a problem chipping in. The point you are missing is that right now, 90% of the US population cannot afford to pay for child-birth (or any other medical procedure) themselves (out of pocket), as they typically cost $20K and up. With a reasonable market- (or single-payer-) based health-care system, most people (except for the poor and almost-poor) would be able to pay for their own health care. The current "system" in the US is a scam of major proportions.
- deleted 9y ago
  [deleted]
- icelancer 9y ago
  >Who will pay for all the people who didn't save? The people who did. Correct. It is generally a good idea to consider all of the money being paid into Social Security to be completely wasted. I am in my early-mid 30s and I do not expect to see a dime of it. I think it will either be insolvent or subject to some ridiculous tax structure if people have earned X dollars in their lifetimes or spent too many years in high tax brackets (which I expect to in my late 30s and 40s). Taxes will also go up dramatically as the years go by. I have a maxed-yearly Roth IRA but I also don't expect the government to keep their promise on letting me take out 100% of it tax-free despite all my contributions being post-tax. I expect to be double taxed on that, because, well, why not? Retirement is ridiculous. It's just generally safe to assume all of your money is going to be taxed at a much higher rate and through loopholes/broken promises by the government. We face a really huge shortfall in the next few decades in public welfare programs, Social Security, and other tax-advantaged vehicles that I doubt will be honored down the line.
  - mattmanser 9y ago
    It's not retirement that's ridiculous, it's that old people have a vote in this and because that vote is so overpowering, no-one will even try and fix the issue until it's too late.
  - carbocation 9y ago
    If you really expect your Roth to be double taxed, why not contribute to a traditional IRA instead?
    - hkmurakami 9y ago
      Because expectation is not certainty.
    - icelancer 9y ago
      There's some business-related reasons why I don't (I don't yet make enough money in salary for it to matter wrt deductions) but also because I think taxes will be very high when I retire and that my Roth will be taxed at a relatively low rate, subject to some "fees" or something. I think the Roth will still exceed the value of a traditional IRA (plus it's only $5500/year, hardly huge as I get older and my net worth increases), but I would be willing to bet that the Roth IRA will not exist in the form it does in 20-30 years, and that existing ones will be subject to a tax/fee to make it "fair."
- nostrademons 9y ago
  Depends how history plays out in the future. If people who save end up paying for people who didn't, it implies one of three things: 1) financial panic 2) inflation or 3) taxation. All of these are fairly likely, but looking back at history, there are a number of other possible futures that would take care of the problem. Mass plague, where all the old people die off. Mandatory euthanasia, where the government kills all the old people. War or anarchy, where both young and old die indiscriminately. Colonizing other planets, which opens up vast new resources. Mass automation of health & elder care, so the robots pay for the people who don't save. The depressing thing is that most of these are pretty horrible, and the two that aren't - automation and spaceflight - are probably the least likely. But then, history is filled with black swan events that open up human frontiers that nobody could've imagined. Maybe one of them will save us.
  - kamaal 9y ago
    Or like it worked in most socialist economies which gradually migrated to free market in the 90s. Older people make painful sacrifices to merely survive. Younger population doesn't care, and largely thinks the old deserve it for not being serious about their retirements in young age. Social security in that situation will largely depend on continuing to work in old age, and surviving on bare minimum money and at worst depending on kids and friends. War and anarchy aren't feasible in old age, when you get knee pain for walking across the street. The whole thing will be bad, its just people have to deal with it and move on.
m1sta_ 9y ago
When you don't have enough to survive it's difficult to argue that taking what you need is immoral.
bengale 9y ago
Who could possible afford 3 children these days?
- oh_sigh 9y ago
  Apparently only the poorest people in the world: https://en.wikipedia.org/wiki/Income_and_fertility https://en.wikipedia.org/wiki/Income_and_fertility
  - dijit 9y ago
    Very broadly speaking (UK, Sweden at least since I live(d) there and know the rules); more kids = more income if you're living on income support. So you have linearly increasing support depending on the number of people who depend on you. There is no such linearity in work- you get paid and you pay whatever you need to pay, the company and the state do not make things easier. I'm not saying that if you have kids on welfare you're better off- I'm saying that it's an easier cross to bear when you may not be as significantly worse off as you would be if you had a flat income.
    - dijit 9y ago
      I've offended someone with a botnet. Apologies. If it makes you feel any better I was raised on welfare in the UK and am not insinuating anything negative. This is the reality of living on income support- if it is _not_ then please provide evidence instead of hitting the disagree button needlessly.
- dublinclontarf 9y ago
  Most people.
- hellweaver666 9y ago
  I have 3 kids. I earn a decent wage but nothing excessive and my wife doesn't work (she looks after the kids). We live in a city, don't own a car and walk or bike most places. They don't cost that much more if you're willing to be sensible (each kid doesn't need a TV and a games console or even their own bedroom). We're very moderate on how we spend our money - we don't blow thousands at Christmas just to give kids tat they won't play with, we keep clothes and re-use them as the younger kids grow up. We eat at home as a family, don't take extravagant holidays etc etc.
collyw 9y ago
"Nowadays, many of my peers don't get a "real" job until their early/mid-thirties (work for 30 years of producitivty), produce 1.7 children per woman if they reproduce at all (leading to a top-heavy population where fewer and fewer young people must support more and more old people) and life expectancy is much, much higher." With increases in productivity, this could be sustainable, but as this article points out, wages have basically stagnated in comparison since ~2000. http://www.nytimes.com/2012/12/12/opinion/global/jobs-productivity-and-the-great-decoupling.html http://www.nytimes.com/2012/12/12/opinion/global/jobs-produc...
- secfirstmd 9y ago
  This is the basic issue. Liberal capitalism made a de facto deal in 80s. Lower taxes for business, create more jobs but with less benefits, resulting in lower intake for governments but the losses will be made up through income taxes through higher wages. Except that deal has turned out to be rubbish, businesses continued to find ways to lower taxes (Ireland, BVI, Netherlands, transfer pricing etc). At the same time wages were held down. The gains of course were largely grabbed by the top 1 percent. I'm a capitalist but I know that this is no longer sustainable. Fundamentally there comes a point were failure to raise wages means your customers can longer afford to buy your stuff. So your biting the hand that feeds you. Then you end up with the customers creating a credit bubble to try and replace what they have lost through low wages, resulting in sub prime crash, US student debt etc etc
  - icu 9y ago
    The situation was never sustainable from the beginning as the economy has actually been rigged and obfuscated since the collapse of Bretton Woods. It comes down to a confluence of r vs K effects on politics (and it's knock on effect on higher education and student debt), the Fed being a private bank masquerading as a US Government institution, fiat currency, and fractional reserve banking. This is the actual cause for inflation (which erodes the purchasing power of wages), and the so called "business cycle" of boom and bust (e.g. the credit bubble). Globalisation has also further exacerbated wealth transfer and increased the risk of systemic failure. But this is not actually liberal capitalism's fault. Crony capitalism and Government intervention is to blame. There is nothing "liberal capitalism" about tax payers selectively underwriting shareholders. Under a "liberal capitalism" doctrine, the market is allowed to reward winners and punish losers. If anything liberal capitalism is the only way to save the system but it will be an extremely rough transition.
misja111 9y ago
There is some irony in the things you're saying: > Retirement is the golden carrot dangled in front of us for all our working lives .. And then: > .. and the average lifespan was 64 years (1 year before retirement) Wouldn't it be more rational to try to get as much happiness and fullfillment from the years you spend working and healthy, instead of waiting for those few years you might have after your retirement? And maybe, if you don't have much money to spare, it would also be more rational decision to spend your money now instead of saving it for an age which you might never even reach ..
- Spearchucker 9y ago
  You make some good points. Working yourself to the bone until retirement is probably not the best approach. Spending ALL your money is maybe a bad idea though. My plan is in the middle somewhere. I earn a decent living, and have a modest pension. The plan though is to save enough for a large piece of land in a cheap but stable country (inasmuch as THAT's possible - current thinking is Austria or South Africa), with a house, and then become self-sufficient on that land. Until I cash in my chips.
- coolg54321 9y ago
  I second that. Someone said Yesterday is history, tomorrow is mystery and today is a gift! but still there should be a balance
- tonyedgecombe 9y ago
  In our industry it's a reasonable assumption we are going to live well past the age where most of us can find work.
crdoconnor 9y ago
The dependency ratio has gone up something like ~11-15% since the 50s whereas GDP has gone up something like 2-300%. This is where your pension wealth actually went: https://cdn.americanprogress.org/wp-content/uploads/2014/09/middleclasssqueeze-fig11.png https://cdn.americanprogress.org/wp-content/uploads/2014/09/... >Retirement is the golden carrot dangled in front of us Not exactly. The 1% keeps pushing the "demographic time bomb" trope through the media precisely to make us believe that that this "golden carrot" is a vain hope.
- jononor 9y ago
  What would they benefit from that? Would it not be better if people were just working good and hard in the belief of a good retirement in the end?
apexalpha 9y ago
>The whole western world is in for a rude awakaning in the coming years with regards to retirement. Most Western countries have mandatory pension systems in place. In my country, NL, everyone has to pay money into pensioen funds that invest it for you.
- efdee 9y ago
  Sadly, in most of the Western countries, your pension payments go to paying the pensions currently being handed out. By the time you'll need yours, unless something changes, there won't be enough money to pay it. That's why you're now encouraged to enlist in private pension saving plans and all those things. At least, that's the outlook in Belgium.
  - apexalpha 9y ago
    We only do that for the government part of the pension. your additional pension is saved up and invested for you. Currently there is about 2 trillion USD in the Dutch pension system.
kk_cz 9y ago
> (good population age distribution, the classic "pyramid") I would say that this is part of the problem: relying on something that is basically a ponzi scheme. Of course the European social systems work if you can constantly increase your population. But this doesn't work in the real life - the area of the country doesn't increase, therefore you can't increase your population infinitely. The reason young folks nowadays don't have 3 kids is that it's just not economically feasible any more. Add the fact that the top of the pyramid is getting wider every year (life expectancy is increasing) and here we are. The system was flawed since the beginning and now we are hitting the limits.
- nostrademons 9y ago
  Ponzi schemes are much more common in nature than humans like to think. The default population dynamics for most species are feast-or-famine: population grows exponentially until it exhausts all available food sources, and then mass numbers of individuals die off all at once, leaving more resources for the survivors. Hell, life is a ponzi scheme: our cells divide, accumulating genetic mistakes (= technical debt) each time, until our body's ability to repair the damage is overcome by the accumulated mistakes. And then we die, hopefully having produced a fresh new individual to repeat the process. Assuming no great technological breakthrough, the same thing will happen on a societal level: we'll die. But then, we knew there was 100% chance of that happening from the beginning.
  - kamaal 9y ago
    The famine part in case of humans isn't so savage. In most functioning economies its slow painful negotiation with reality.
arethuza 9y ago
"work hard and you will be rewarded in the end" An alarming number of people I know who had high flying careers and who retired with huge pension funds died within a relatively short time of retiring. Maybe its something weird about my extended family....
BjoernKW 9y ago
What makes me angry about this is that politicians in industrialised nations have no qualms with bailing out current retirees (because those will save them their next few re-elections) and shoring up mindless consumption at the expense of those who try to live more frugally. Yet at the same time the very same politicians claim there's not enough money for implementing a universal basic income right here, right now.
6t6t6t6 9y ago
300 years ago, 80% of the population had to work in agriculture just to keep the country fed and alive. Now, less than 5% work in agriculture and we produce so much food, that supermarkets have to throw more than half of what they buy. Productivity has been growing in a exponential way since the beginning of the industrial revolution. Automation will allow many of the products we consume today to be produced almost without human intervention. My point is that we, as a society, will be able to maintain the same standards of living (or increase them) while the workforce shrinks. The only issue here is how the wealth produced by the automation will be distributed, but I can imagine a future where people is actually employed during less than half of their lives and still live well enough.

deleted 9y ago

[deleted]

morecoffee 9y ago

> The whole western world is in for a rude awakening in the coming years with regards to retirement. No kidding. Who will pay for all the people who didn't save? The people who did. I have very little expectation of keeping most of my money as I get older.

frisco 9y ago
> I have very little expectation of keeping most of my money as I get older. Welcome to the world of Bitcoin and Monero.
- googletazer 9y ago
  Incredible that you are so heavily downvoted. Just shows the level of fear and disdain that even technical people have towards cryptocurrency.
sddfd 9y ago
Exactly and now tell anyone that it was ever a good idea to not provide basic pensions for everyone and make payments mandatory. If that had been the case then at least everyone had paid at some point.
- varjag 9y ago
  This idea is not without drawbacks. Mandatory pension systems have a history of being wiped out by extinction events both governmental (USSR et al) and corporate (Kodak and other midcentury megacorps). It's at least something I guess, but retirement planning is a really really long forecast horizon and is inherently risky.
  - blubb-fish 9y ago
    In Germany the retirement system is far from perfect - but it at least keeps (most) people from being homeless or starving. The lack of universal health insurance in the USA is basically traceable to the same societal shortcomings. Why should a rich banker support with his premium health insurance for a woman who gets pregnant - as he's not getting pregnant anyway. That's a very egoistical way to look at communal cooperation but at the end of the day the reason for why ACA is being sabotaged by many politicians.
    - peteretep 9y ago
      But but ... that's socialism! And socialism is bad because ... USA USA!
      - blubb-fish 9y ago
        don't know why you're downvoted - your comment is not constructive but an ironic reflection - I think that's totally fine.
    - jazzyk 9y ago
      I am far from rich, and not a banker. I assume by "woman" you meant someone who is at or below poverty line, if so, I (and most people) don't have a problem chipping in. The point you are missing is that right now, 90% of the US population cannot afford to pay for child-birth (or any other medical procedure) themselves (out of pocket), as they typically cost $20K and up. With a reasonable market- (or single-payer-) based health-care system, most people (except for the poor and almost-poor) would be able to pay for their own health care. The current "system" in the US is a scam of major proportions.
deleted 9y ago
[deleted]
icelancer 9y ago
>Who will pay for all the people who didn't save? The people who did. Correct. It is generally a good idea to consider all of the money being paid into Social Security to be completely wasted. I am in my early-mid 30s and I do not expect to see a dime of it. I think it will either be insolvent or subject to some ridiculous tax structure if people have earned X dollars in their lifetimes or spent too many years in high tax brackets (which I expect to in my late 30s and 40s). Taxes will also go up dramatically as the years go by. I have a maxed-yearly Roth IRA but I also don't expect the government to keep their promise on letting me take out 100% of it tax-free despite all my contributions being post-tax. I expect to be double taxed on that, because, well, why not? Retirement is ridiculous. It's just generally safe to assume all of your money is going to be taxed at a much higher rate and through loopholes/broken promises by the government. We face a really huge shortfall in the next few decades in public welfare programs, Social Security, and other tax-advantaged vehicles that I doubt will be honored down the line.
- mattmanser 9y ago
  It's not retirement that's ridiculous, it's that old people have a vote in this and because that vote is so overpowering, no-one will even try and fix the issue until it's too late.
- carbocation 9y ago
  If you really expect your Roth to be double taxed, why not contribute to a traditional IRA instead?
  - hkmurakami 9y ago
    Because expectation is not certainty.
  - icelancer 9y ago
    There's some business-related reasons why I don't (I don't yet make enough money in salary for it to matter wrt deductions) but also because I think taxes will be very high when I retire and that my Roth will be taxed at a relatively low rate, subject to some "fees" or something. I think the Roth will still exceed the value of a traditional IRA (plus it's only $5500/year, hardly huge as I get older and my net worth increases), but I would be willing to bet that the Roth IRA will not exist in the form it does in 20-30 years, and that existing ones will be subject to a tax/fee to make it "fair."
nostrademons 9y ago
Depends how history plays out in the future. If people who save end up paying for people who didn't, it implies one of three things: 1) financial panic 2) inflation or 3) taxation. All of these are fairly likely, but looking back at history, there are a number of other possible futures that would take care of the problem. Mass plague, where all the old people die off. Mandatory euthanasia, where the government kills all the old people. War or anarchy, where both young and old die indiscriminately. Colonizing other planets, which opens up vast new resources. Mass automation of health & elder care, so the robots pay for the people who don't save. The depressing thing is that most of these are pretty horrible, and the two that aren't - automation and spaceflight - are probably the least likely. But then, history is filled with black swan events that open up human frontiers that nobody could've imagined. Maybe one of them will save us.
- kamaal 9y ago
  Or like it worked in most socialist economies which gradually migrated to free market in the 90s. Older people make painful sacrifices to merely survive. Younger population doesn't care, and largely thinks the old deserve it for not being serious about their retirements in young age. Social security in that situation will largely depend on continuing to work in old age, and surviving on bare minimum money and at worst depending on kids and friends. War and anarchy aren't feasible in old age, when you get knee pain for walking across the street. The whole thing will be bad, its just people have to deal with it and move on.

m1sta_ 9y ago

When you don't have enough to survive it's difficult to argue that taking what you need is immoral.

bengale 9y ago

Who could possible afford 3 children these days?

oh_sigh 9y ago
Apparently only the poorest people in the world: https://en.wikipedia.org/wiki/Income_and_fertility https://en.wikipedia.org/wiki/Income_and_fertility
- dijit 9y ago
  Very broadly speaking (UK, Sweden at least since I live(d) there and know the rules); more kids = more income if you're living on income support. So you have linearly increasing support depending on the number of people who depend on you. There is no such linearity in work- you get paid and you pay whatever you need to pay, the company and the state do not make things easier. I'm not saying that if you have kids on welfare you're better off- I'm saying that it's an easier cross to bear when you may not be as significantly worse off as you would be if you had a flat income.
  - dijit 9y ago
    I've offended someone with a botnet. Apologies. If it makes you feel any better I was raised on welfare in the UK and am not insinuating anything negative. This is the reality of living on income support- if it is _not_ then please provide evidence instead of hitting the disagree button needlessly.
dublinclontarf 9y ago
Most people.
hellweaver666 9y ago
I have 3 kids. I earn a decent wage but nothing excessive and my wife doesn't work (she looks after the kids). We live in a city, don't own a car and walk or bike most places. They don't cost that much more if you're willing to be sensible (each kid doesn't need a TV and a games console or even their own bedroom). We're very moderate on how we spend our money - we don't blow thousands at Christmas just to give kids tat they won't play with, we keep clothes and re-use them as the younger kids grow up. We eat at home as a family, don't take extravagant holidays etc etc.

collyw 9y ago

"Nowadays, many of my peers don't get a "real" job until their early/mid-thirties (work for 30 years of producitivty), produce 1.7 children per woman if they reproduce at all (leading to a top-heavy population where fewer and fewer young people must support more and more old people) and life expectancy is much, much higher." With increases in productivity, this could be sustainable, but as this article points out, wages have basically stagnated in comparison since ~2000. http://www.nytimes.com/2012/12/12/opinion/global/jobs-productivity-and-the-great-decoupling.html http://www.nytimes.com/2012/12/12/opinion/global/jobs-produc...

secfirstmd 9y ago
This is the basic issue. Liberal capitalism made a de facto deal in 80s. Lower taxes for business, create more jobs but with less benefits, resulting in lower intake for governments but the losses will be made up through income taxes through higher wages. Except that deal has turned out to be rubbish, businesses continued to find ways to lower taxes (Ireland, BVI, Netherlands, transfer pricing etc). At the same time wages were held down. The gains of course were largely grabbed by the top 1 percent. I'm a capitalist but I know that this is no longer sustainable. Fundamentally there comes a point were failure to raise wages means your customers can longer afford to buy your stuff. So your biting the hand that feeds you. Then you end up with the customers creating a credit bubble to try and replace what they have lost through low wages, resulting in sub prime crash, US student debt etc etc
- icu 9y ago
  The situation was never sustainable from the beginning as the economy has actually been rigged and obfuscated since the collapse of Bretton Woods. It comes down to a confluence of r vs K effects on politics (and it's knock on effect on higher education and student debt), the Fed being a private bank masquerading as a US Government institution, fiat currency, and fractional reserve banking. This is the actual cause for inflation (which erodes the purchasing power of wages), and the so called "business cycle" of boom and bust (e.g. the credit bubble). Globalisation has also further exacerbated wealth transfer and increased the risk of systemic failure. But this is not actually liberal capitalism's fault. Crony capitalism and Government intervention is to blame. There is nothing "liberal capitalism" about tax payers selectively underwriting shareholders. Under a "liberal capitalism" doctrine, the market is allowed to reward winners and punish losers. If anything liberal capitalism is the only way to save the system but it will be an extremely rough transition.

misja111 9y ago

There is some irony in the things you're saying: > Retirement is the golden carrot dangled in front of us for all our working lives .. And then: > .. and the average lifespan was 64 years (1 year before retirement) Wouldn't it be more rational to try to get as much happiness and fullfillment from the years you spend working and healthy, instead of waiting for those few years you might have after your retirement? And maybe, if you don't have much money to spare, it would also be more rational decision to spend your money now instead of saving it for an age which you might never even reach ..

Spearchucker 9y ago
You make some good points. Working yourself to the bone until retirement is probably not the best approach. Spending ALL your money is maybe a bad idea though. My plan is in the middle somewhere. I earn a decent living, and have a modest pension. The plan though is to save enough for a large piece of land in a cheap but stable country (inasmuch as THAT's possible - current thinking is Austria or South Africa), with a house, and then become self-sufficient on that land. Until I cash in my chips.
coolg54321 9y ago
I second that. Someone said Yesterday is history, tomorrow is mystery and today is a gift! but still there should be a balance
tonyedgecombe 9y ago
In our industry it's a reasonable assumption we are going to live well past the age where most of us can find work.

crdoconnor 9y ago

The dependency ratio has gone up something like ~11-15% since the 50s whereas GDP has gone up something like 2-300%. This is where your pension wealth actually went: https://cdn.americanprogress.org/wp-content/uploads/2014/09/middleclasssqueeze-fig11.png https://cdn.americanprogress.org/wp-content/uploads/2014/09/... >Retirement is the golden carrot dangled in front of us Not exactly. The 1% keeps pushing the "demographic time bomb" trope through the media precisely to make us believe that that this "golden carrot" is a vain hope.

jononor 9y ago
What would they benefit from that? Would it not be better if people were just working good and hard in the belief of a good retirement in the end?

apexalpha 9y ago

>The whole western world is in for a rude awakaning in the coming years with regards to retirement. Most Western countries have mandatory pension systems in place. In my country, NL, everyone has to pay money into pensioen funds that invest it for you.

efdee 9y ago
Sadly, in most of the Western countries, your pension payments go to paying the pensions currently being handed out. By the time you'll need yours, unless something changes, there won't be enough money to pay it. That's why you're now encouraged to enlist in private pension saving plans and all those things. At least, that's the outlook in Belgium.
- apexalpha 9y ago
  We only do that for the government part of the pension. your additional pension is saved up and invested for you. Currently there is about 2 trillion USD in the Dutch pension system.

kk_cz 9y ago

> (good population age distribution, the classic "pyramid") I would say that this is part of the problem: relying on something that is basically a ponzi scheme. Of course the European social systems work if you can constantly increase your population. But this doesn't work in the real life - the area of the country doesn't increase, therefore you can't increase your population infinitely. The reason young folks nowadays don't have 3 kids is that it's just not economically feasible any more. Add the fact that the top of the pyramid is getting wider every year (life expectancy is increasing) and here we are. The system was flawed since the beginning and now we are hitting the limits.

nostrademons 9y ago
Ponzi schemes are much more common in nature than humans like to think. The default population dynamics for most species are feast-or-famine: population grows exponentially until it exhausts all available food sources, and then mass numbers of individuals die off all at once, leaving more resources for the survivors. Hell, life is a ponzi scheme: our cells divide, accumulating genetic mistakes (= technical debt) each time, until our body's ability to repair the damage is overcome by the accumulated mistakes. And then we die, hopefully having produced a fresh new individual to repeat the process. Assuming no great technological breakthrough, the same thing will happen on a societal level: we'll die. But then, we knew there was 100% chance of that happening from the beginning.
- kamaal 9y ago
  The famine part in case of humans isn't so savage. In most functioning economies its slow painful negotiation with reality.

arethuza 9y ago

"work hard and you will be rewarded in the end" An alarming number of people I know who had high flying careers and who retired with huge pension funds died within a relatively short time of retiring. Maybe its something weird about my extended family....

BjoernKW 9y ago

What makes me angry about this is that politicians in industrialised nations have no qualms with bailing out current retirees (because those will save them their next few re-elections) and shoring up mindless consumption at the expense of those who try to live more frugally. Yet at the same time the very same politicians claim there's not enough money for implementing a universal basic income right here, right now.

6t6t6t6 9y ago

300 years ago, 80% of the population had to work in agriculture just to keep the country fed and alive. Now, less than 5% work in agriculture and we produce so much food, that supermarkets have to throw more than half of what they buy. Productivity has been growing in a exponential way since the beginning of the industrial revolution. Automation will allow many of the products we consume today to be produced almost without human intervention. My point is that we, as a society, will be able to maintain the same standards of living (or increase them) while the workforce shrinks. The only issue here is how the wealth produced by the automation will be distributed, but I can imagine a future where people is actually employed during less than half of their lives and still live well enough.