16 ms·

This is because of their low birth rate primarily right? I think the system has failed at this point, when you are expected to work that long.

by dtgm92 1y ago

tossandthrow 1y ago
It is. 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
- namdnay 1y ago
  The trap is the worse the imbalance gets, the harder (1) gets electorally
  - tossandthrow 1y ago
    Number 1 is likely the outcome of passivity - inflation will eat away the value of the pension.
    - namdnay 1y ago
      In many countries pensions are indexed on inflation… so there is no natural erosion unfortunately
- CubsFan1060 1y ago
  Wouldn't the fourth way be via increasing either birth rate or immigration?
  - lostlogin 1y ago
    That’s collecting more taxes, 2, isn’t it?
    - JackYoustra 1y ago
      technically true but people usually associate that with rate increases
      - lostlogin 1y ago
        I’m not sure that’s always true. 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.
  - mr_toad 1y ago
    The people who would actually benefit from that the most are the people who are too old to have children and are strongly opposed to immigration.
    - varelse 1y ago
      [dead]
  - SoftTalker 1y ago
    [flagged]
    - grunder_advice 1y ago
      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.
      - bananalychee 1y ago
        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.
        yborg 1y ago
        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.
  - constantcrying 1y ago
    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.
    - trueismywork 1y ago
      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.
  - cbeach 1y ago
    Raising immigration rates to solve an aging population is a Ponzi solution.
    - jaoane 1y ago
      The pension system has always been a ponzi. Only now we are faced to realise it because the pyramid was flipped violently.
    - risyachka 1y ago
      In the modern economy system there is no way around it. 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
  - impossiblefork 1y ago
    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.
  - pfdietz 1y ago
    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.
    - amanaplanacanal 1y ago
      As Jan and Dean put it in Surf City: "two girls for every boy".
      - pfdietz 1y ago
        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.
        adrianN 1y ago
        I wouldn’t be surprised if historically there were more women than men due to accidents involving mammoths or clubs meeting skulls.
      - AdrianB1 1y ago
        Without a major and unrealistic cultural change, 2 girls to share one boy (polygamy) is not going to happen.
        const_cast 1y ago
        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.
  - nicolashahn 1y ago
    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.
    - bugglebeetle 1y ago
      In 50 years, Japan will have a Chinese majority, so…
    - heyheyhouhou 1y ago
      it is 6% muslim majority?
      - BenFranklin100 1y ago
        [flagged]
      - nicolashahn 1y ago
        [flagged]
        heyheyhouhou 1y ago
        yes, I read it, still is 6%.
        nicolashahn 1y ago
        [flagged]
        maleldil 1y ago
        [flagged]
    - mariusor 1y ago
  - telotortium 1y ago
    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. [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-indvandreres-nettobidrag-til-de-offentlige-finanser-i-2018/ https://fm.dk/udgivelser/2021/oktober/oekonomisk-analyse-ind...
    - mmooss 1y ago
      It turns out that economic productivity is not tied to ethnicity or where you are from - fundamentally racist notions - but to how productive you are.
      - nine_k 1y ago
        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.
        selimthegrim 1y ago
        Freddie Mercury wasn't of Middle Eastern background.
  - niemandhier 1y ago
    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.
    - n_ary 1y ago
      > 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).
      - arandomusername 1y ago
        Most immigrants are not war refugees but economical refugees. > 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.
      - niemandhier 1y ago
        You are right regarding the insufficient opportunities for highly qualified people. Regarding your other point: https://home-affairs.ec.europa.eu/whats-new/publications/oecd-report-germany-status-immigrant-integration_en#:~:text=Only%2040%25%20of%20immigrant%20women,without%20school%20qualifications%20in%20Germany. https://home-affairs.ec.europa.eu/whats-new/publications/oec... The liked pdf there gives a good overview.
  - Ray20 1y ago
    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).
    - AdrianB1 1y ago
      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.
    - vbezhenar 1y ago
      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. No one wants to implement it.
      - const_cast 1y ago
        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.
      - geodel 1y ago
        You are right. Since that is not happening the next best thing is to juice the oldies. At least more countries have started doing that.
  - deleted 1y ago
    [deleted]
  - lo_zamoyski 1y ago
    Yes and no. 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.
  - babyent 1y ago
    Please only educated immigrants who will need to assimilate to the culture. 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.
- littlestymaar 1y ago
  You are missing the most important one: - 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.
  - tossandthrow 1y ago
    That would be raising taxes. - indifferent to how much automation you have, people still need to pay for it, for money they don't earn.
    - littlestymaar 1y ago
      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.
      - tossandthrow 1y ago
        Exactly, another way to increase taxes is also by increasing gdp. Indeed the normal Understanding is not only about increasing rates - look at Switzerland eg.
        littlestymaar 1y ago
        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.
        tossandthrow 1y ago
        This is not fitting anything into anywhere. This is how economists think about.
- lostlogin 1y ago
  2 has some options. Increase the number of (young) immigrants. Increase the birthrate (has anywhere managed this?).
  - tossandthrow 1y ago
    Birthrates are problematic as it usually take 20 to 25 years before they pay taxes. And in that time they require a lot of expenses. They talk abiut the squeeze, if Birthrates increase too suddenly - workers would both have to pay for the elderly and the kids.
    - spacebanana7 1y ago
      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.
      - lostlogin 1y ago
        > 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.
        gambiting 1y ago
        >>Previously people died younger, so couldn’t 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.
- dyauspitr 1y ago
  4. Stop spending 90% of healthcare costs on 5% of chronic problem beneficiaries.
  - tossandthrow 1y ago
    That is increasing tax.
    - dyauspitr 1y ago
      How? Less tax but 5% of people get worse healthcare.
- WinstonSmith84 1y ago
  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.
  - distances 1y ago
    > 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.
  - tossandthrow 1y ago
    Denmark does have ratepension, which is exactly that. People with good private pensions can decide to retire 5 years before they officially retire.
- jxjnskkzxxhx 1y ago
  What does "reduce pensions" mean? Pensions are people's property. You can take pensions like you can confiscate property, a la communism.
  - nicolashahn 1y ago
    So close! Pensions are actually property taken from the younger generation and given to retirees.
    - pmg101 1y ago
      I think this is just the word "pension" being overloaded, meaning both 1. A state provided welfare benefit Or 2. A privately held long term savings/investment account
    - m4rtink 1y ago
      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.
      - bee_rider 1y ago
        I’ll take the thanks/appreciation in the form of wages instead, thanks!
    - jonathanstrange 1y ago
      Those retirees have been paying into the pension system their whole life.
      - mattlondon 1y ago
        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...
- hmmokidk 1y ago
  Can also just raise taxes on the super rich
  - bombcar 1y ago
    A 99.9% wealth tax on US billionaires would cover the annual deficit for about 1.5 years. The scale of the problem is absolutely mind-blowing.
    - FirmwareBurner 1y ago
      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.
      - IndubitableCoil 1y ago
        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.
        gambiting 1y ago
        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.
        HDThoreaun 1y ago
        Other countries dump the dollar as soon the US makes credible plans to print money in order to sustain the deficit.
- robaato 1y ago
  No 4 - do like Norway: https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Norway https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor...
  - rad_gruchalski 1y ago
    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?
  - CamperBob2 1y ago
    You forgot step -1: Use time machine constructed in step 3.5 to seed nearby oceans with phytoplankton and other organic carbon reservoirs
  - Ray20 1y ago
    It turns out you won't have a problem funding your pension system if you literally pump out millions of dollars' worth of oil per person.
  - keybored 1y ago
    Norway is also going to raise the retirement age.
    - deleted 1y ago
      [deleted]
- mmooss 1y ago
  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.
  - SpicyLemonZest 1y ago
    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.
    - mmooss 1y ago
      > Economic growth in the abstract doesn't help much True, but economic growth is very real.
  - tossandthrow 1y ago
    Why? 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.
    - mmooss 1y ago
      > economic growth has merely been translated into inflated expectations It's been translated into far better services too.
- risyachka 1y ago
  4. They must attract skilled immigrants in significant numbers. Most don't want to so they have to compensate via taxes and higher pension age.
FirmwareBurner 1y ago
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.
- namdnay 1y ago
  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
  - tossandthrow 1y ago
    > 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.
    - namdnay 1y ago
      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
      - tossandthrow 1y ago
        I reckon the presumption is that current pensioners don't live as long as future pensioners. Hence only doing this for future pensioners will give equal time as reitred. (at least, this is the core reasoning)
simianwords 1y ago
why not because of increased life expectancy?
- spacebanana7 1y ago
  That actually makes the problem worse unless retirement ages tick up at the same rate.
  - lancekey 1y ago
    I think that’s what parent comment is saying: if life expectancy goes up, shouldn’t retirement age?
    - spacebanana7 1y ago
      Thanks, I misunderstood. I suppose increased life expectancy and fewer young people both contribute to worse dependency ratios.
      - simianwords 1y ago
        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.
        brewdad 1y ago
        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.
constantcrying 1y ago
No. It is about how the system is funded. 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.
- JackYoustra 1y ago
  Chile had this and, while technocratically sound, was so unpopular it led to a new constitution.
- tossandthrow 1y ago
  This is about public pensions. 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.
  - constantcrying 1y ago
    Germany has private pensions. Just as in Germany Denmark funds it's pensions through taxes, Germany additionally funds them through employee contributions.
    - tossandthrow 1y ago
      But these are organized as insurances, right? In Denmark you have ratepension, which truly is an investment account and not an insurance product.
- 1y ago
lancekey 1y ago
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?
- philjohn 1y ago
  It's rising, but much slower than before - and plateaud in the 2010's for a good few years, UK stats - https://www.macrotrends.net/global-metrics/countries/gbr/united-kingdom/life-expectancy https://www.macrotrends.net/global-metrics/countries/gbr/uni...
  - lancekey 1y ago
    So since 1950, lifespan has gone up ~14 years in UK. 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.
    - holsta 1y ago
      We are not living longer, fewer infants / kids are dying.
      - ant6n 1y ago
        True. The interesting stat would be expected lifetime at retirement age.
        sgt101 1y ago
        You can find the info here: https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/lifeexpectancies/datasets/nationallifetablesenglandreferencetables https://www.ons.gov.uk/peoplepopulationandcommunity/birthsde... 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).
rors 1y ago
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.
- pwarner 1y ago
  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.
  - anonzzzies 1y ago
    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.
mihaaly 1y ago
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.
agilob 1y ago
Having a 68 year old paediatrician, PE teacher will surely help.
Barrin92 1y ago
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.
II2II 1y ago
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.
nine_k 1y ago
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.
- neom 1y ago
  Do you have a sense of how you see it playing out?
  - cyberax 1y ago
    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/ 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.
    - johnny22 1y ago
      > The birth rate in cities is strongly anti-correlated with the city size. This might be true, but could be for many reasons. There's not enough info in that to promote a specific response.
sgt101 1y ago
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.
AdrianB1 1y ago
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.
EliRivers 1y ago
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.
- satvikpendem 1y ago
  What system would work?
croes 1y ago
You don’t need higher birth rates if the productivity rises and the created wealth is fairly distributed.
satvikpendem 1y ago
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.
- jmpetroske 1y ago
  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?
  - satvikpendem 1y ago
    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?
    - Spivak 1y ago
      > 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.
      - missedthecue 1y ago
        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.
        jmpetroske 1y ago
frollogaston 1y ago
Some people really can't have kids or need extra help, but aside from that, social security sets up the wrong incentives.

This is because of their low birth rate primarily right? I think the system has failed at this point, when you are expected to work that long.

by dtgm92 1y ago

This is because of their low birth rate primarily right? I think the system has failed at this point, when you are expected to work that long.

tossandthrow 1y ago

It is. 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

namdnay 1y ago
The trap is the worse the imbalance gets, the harder (1) gets electorally
- tossandthrow 1y ago
  Number 1 is likely the outcome of passivity - inflation will eat away the value of the pension.
  - namdnay 1y ago
    In many countries pensions are indexed on inflation… so there is no natural erosion unfortunately
CubsFan1060 1y ago
Wouldn't the fourth way be via increasing either birth rate or immigration?
- lostlogin 1y ago
  That’s collecting more taxes, 2, isn’t it?
  - JackYoustra 1y ago
    technically true but people usually associate that with rate increases
    - lostlogin 1y ago
      I’m not sure that’s always true. 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.
- mr_toad 1y ago
  The people who would actually benefit from that the most are the people who are too old to have children and are strongly opposed to immigration.
  - varelse 1y ago
    [dead]
- SoftTalker 1y ago
  [flagged]
  - grunder_advice 1y ago
    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.
    - bananalychee 1y ago
      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.
      - yborg 1y ago
        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.
- constantcrying 1y ago
  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.
  - trueismywork 1y ago
    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.
- cbeach 1y ago
  Raising immigration rates to solve an aging population is a Ponzi solution.
  - jaoane 1y ago
    The pension system has always been a ponzi. Only now we are faced to realise it because the pyramid was flipped violently.
  - risyachka 1y ago
    In the modern economy system there is no way around it. 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
- impossiblefork 1y ago
  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.
- pfdietz 1y ago
  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.
  - amanaplanacanal 1y ago
    As Jan and Dean put it in Surf City: "two girls for every boy".
    - pfdietz 1y ago
      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.
      - adrianN 1y ago
        I wouldn’t be surprised if historically there were more women than men due to accidents involving mammoths or clubs meeting skulls.
    - AdrianB1 1y ago
      Without a major and unrealistic cultural change, 2 girls to share one boy (polygamy) is not going to happen.
      - const_cast 1y ago
        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.
- nicolashahn 1y ago
  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.
  - bugglebeetle 1y ago
    In 50 years, Japan will have a Chinese majority, so…
  - heyheyhouhou 1y ago
    it is 6% muslim majority?
    - BenFranklin100 1y ago
      [flagged]
    - nicolashahn 1y ago
      [flagged]
      - heyheyhouhou 1y ago
        yes, I read it, still is 6%.
        nicolashahn 1y ago
        [flagged]
        maleldil 1y ago
        [flagged]
  - mariusor 1y ago
- telotortium 1y ago
  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. [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-indvandreres-nettobidrag-til-de-offentlige-finanser-i-2018/ https://fm.dk/udgivelser/2021/oktober/oekonomisk-analyse-ind...
  - mmooss 1y ago
    It turns out that economic productivity is not tied to ethnicity or where you are from - fundamentally racist notions - but to how productive you are.
    - nine_k 1y ago
      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.
      - selimthegrim 1y ago
        Freddie Mercury wasn't of Middle Eastern background.
- niemandhier 1y ago
  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.
  - n_ary 1y ago
    > 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).
    - arandomusername 1y ago
      Most immigrants are not war refugees but economical refugees. > 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.
    - niemandhier 1y ago
      You are right regarding the insufficient opportunities for highly qualified people. Regarding your other point: https://home-affairs.ec.europa.eu/whats-new/publications/oecd-report-germany-status-immigrant-integration_en#:~:text=Only%2040%25%20of%20immigrant%20women,without%20school%20qualifications%20in%20Germany. https://home-affairs.ec.europa.eu/whats-new/publications/oec... The liked pdf there gives a good overview.
- Ray20 1y ago
  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).
  - AdrianB1 1y ago
    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.
  - vbezhenar 1y ago
    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. No one wants to implement it.
    - const_cast 1y ago
      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.
    - geodel 1y ago
      You are right. Since that is not happening the next best thing is to juice the oldies. At least more countries have started doing that.
- deleted 1y ago
  [deleted]
- lo_zamoyski 1y ago
  Yes and no. 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.
- babyent 1y ago
  Please only educated immigrants who will need to assimilate to the culture. 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.
littlestymaar 1y ago
You are missing the most important one: - 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.
- tossandthrow 1y ago
  That would be raising taxes. - indifferent to how much automation you have, people still need to pay for it, for money they don't earn.
  - littlestymaar 1y ago
    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.
    - tossandthrow 1y ago
      Exactly, another way to increase taxes is also by increasing gdp. Indeed the normal Understanding is not only about increasing rates - look at Switzerland eg.
      - littlestymaar 1y ago
        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.
        tossandthrow 1y ago
        This is not fitting anything into anywhere. This is how economists think about.
lostlogin 1y ago
2 has some options. Increase the number of (young) immigrants. Increase the birthrate (has anywhere managed this?).
- tossandthrow 1y ago
  Birthrates are problematic as it usually take 20 to 25 years before they pay taxes. And in that time they require a lot of expenses. They talk abiut the squeeze, if Birthrates increase too suddenly - workers would both have to pay for the elderly and the kids.
  - spacebanana7 1y ago
    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.
    - lostlogin 1y ago
      > 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.
      - gambiting 1y ago
        >>Previously people died younger, so couldn’t 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.
dyauspitr 1y ago
4. Stop spending 90% of healthcare costs on 5% of chronic problem beneficiaries.
- tossandthrow 1y ago
  That is increasing tax.
  - dyauspitr 1y ago
    How? Less tax but 5% of people get worse healthcare.
WinstonSmith84 1y ago
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.
- distances 1y ago
  > 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.
- tossandthrow 1y ago
  Denmark does have ratepension, which is exactly that. People with good private pensions can decide to retire 5 years before they officially retire.
jxjnskkzxxhx 1y ago
What does "reduce pensions" mean? Pensions are people's property. You can take pensions like you can confiscate property, a la communism.
- nicolashahn 1y ago
  So close! Pensions are actually property taken from the younger generation and given to retirees.
  - pmg101 1y ago
    I think this is just the word "pension" being overloaded, meaning both 1. A state provided welfare benefit Or 2. A privately held long term savings/investment account
  - m4rtink 1y ago
    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.
    - bee_rider 1y ago
      I’ll take the thanks/appreciation in the form of wages instead, thanks!
  - jonathanstrange 1y ago
    Those retirees have been paying into the pension system their whole life.
    - mattlondon 1y ago
      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...
hmmokidk 1y ago
Can also just raise taxes on the super rich
- bombcar 1y ago
  A 99.9% wealth tax on US billionaires would cover the annual deficit for about 1.5 years. The scale of the problem is absolutely mind-blowing.
  - FirmwareBurner 1y ago
    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.
    - IndubitableCoil 1y ago
      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.
      - gambiting 1y ago
        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.
        HDThoreaun 1y ago
        Other countries dump the dollar as soon the US makes credible plans to print money in order to sustain the deficit.
robaato 1y ago
No 4 - do like Norway: https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Norway https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor...
- rad_gruchalski 1y ago
  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?
- CamperBob2 1y ago
  You forgot step -1: Use time machine constructed in step 3.5 to seed nearby oceans with phytoplankton and other organic carbon reservoirs
- Ray20 1y ago
  It turns out you won't have a problem funding your pension system if you literally pump out millions of dollars' worth of oil per person.
- keybored 1y ago
  Norway is also going to raise the retirement age.
  - deleted 1y ago
    [deleted]
mmooss 1y ago
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.
- SpicyLemonZest 1y ago
  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.
  - mmooss 1y ago
    > Economic growth in the abstract doesn't help much True, but economic growth is very real.
- tossandthrow 1y ago
  Why? 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.
  - mmooss 1y ago
    > economic growth has merely been translated into inflated expectations It's been translated into far better services too.
risyachka 1y ago
4. They must attract skilled immigrants in significant numbers. Most don't want to so they have to compensate via taxes and higher pension age.

FirmwareBurner 1y ago

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.

namdnay 1y ago
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
- tossandthrow 1y ago
  > 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.
  - namdnay 1y ago
    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
    - tossandthrow 1y ago
      I reckon the presumption is that current pensioners don't live as long as future pensioners. Hence only doing this for future pensioners will give equal time as reitred. (at least, this is the core reasoning)

simianwords 1y ago

why not because of increased life expectancy?

spacebanana7 1y ago
That actually makes the problem worse unless retirement ages tick up at the same rate.
- lancekey 1y ago
  I think that’s what parent comment is saying: if life expectancy goes up, shouldn’t retirement age?
  - spacebanana7 1y ago
    Thanks, I misunderstood. I suppose increased life expectancy and fewer young people both contribute to worse dependency ratios.
    - simianwords 1y ago
      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.
      - brewdad 1y ago
        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.

constantcrying 1y ago

No. It is about how the system is funded. 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.

JackYoustra 1y ago
Chile had this and, while technocratically sound, was so unpopular it led to a new constitution.
tossandthrow 1y ago
This is about public pensions. 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.
- constantcrying 1y ago
  Germany has private pensions. Just as in Germany Denmark funds it's pensions through taxes, Germany additionally funds them through employee contributions.
  - tossandthrow 1y ago
    But these are organized as insurances, right? In Denmark you have ratepension, which truly is an investment account and not an insurance product.
1y ago

lancekey 1y ago

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?

philjohn 1y ago
It's rising, but much slower than before - and plateaud in the 2010's for a good few years, UK stats - https://www.macrotrends.net/global-metrics/countries/gbr/united-kingdom/life-expectancy https://www.macrotrends.net/global-metrics/countries/gbr/uni...
- lancekey 1y ago
  So since 1950, lifespan has gone up ~14 years in UK. 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.
  - holsta 1y ago
    We are not living longer, fewer infants / kids are dying.
    - ant6n 1y ago
      True. The interesting stat would be expected lifetime at retirement age.
      - sgt101 1y ago
        You can find the info here: https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/lifeexpectancies/datasets/nationallifetablesenglandreferencetables https://www.ons.gov.uk/peoplepopulationandcommunity/birthsde... 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).

rors 1y ago

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.

pwarner 1y ago
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.
- anonzzzies 1y ago
  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.

mihaaly 1y ago

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.

agilob 1y ago

Having a 68 year old paediatrician, PE teacher will surely help.

Barrin92 1y ago

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.

II2II 1y ago

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.

nine_k 1y ago

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.

neom 1y ago
Do you have a sense of how you see it playing out?
- cyberax 1y ago
  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/ 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.
  - johnny22 1y ago
    > The birth rate in cities is strongly anti-correlated with the city size. This might be true, but could be for many reasons. There's not enough info in that to promote a specific response.

sgt101 1y ago

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.

AdrianB1 1y ago

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.

EliRivers 1y ago

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.

satvikpendem 1y ago
What system would work?

croes 1y ago

You don’t need higher birth rates if the productivity rises and the created wealth is fairly distributed.

satvikpendem 1y ago

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.

jmpetroske 1y ago
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?
- satvikpendem 1y ago
  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?
  - Spivak 1y ago
    > 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.
    - missedthecue 1y ago
      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.
      - jmpetroske 1y ago

frollogaston 1y ago

Some people really can't have kids or need extra help, but aside from that, social security sets up the wrong incentives.