How to Stop a Slow-Motion Disaster: Learning to Live With Global Aging

President Obama will host the G-8 nations next month at Camp David, and while it’s not clear exactly what will be on the agenda, it seems one thing won’t be: global aging, which — among other things — happens to be the mother of all retirement issues.

In the rapidly approaching future, aging populations from Japan and China to most of Europe, Brazil and the U.S. will reshape public policy and begin to weigh on the world’s financial system and growth prospects. As a result, global graying promises to change the face of retirement everywhere as countries come to grips with the escalating costs of caring for so many elderly.

The upshot: You’ll work longer. You’ll have fewer benefits and higher tax rates. You’ll be incentivized to live a healthier lifestyle, and you’ll be asked to stay in the game and give something back when you finally do call it quits for good at 75 or 80. It’s simple math. People are living longer and we are having fewer babies. There will not be enough young to support the old.

Much of this is widely known, of course. Still, the numbers can be startling. The World Health Organization reports that around the globe:

  • The number of people 60 and over has doubled since 1980.
  • The number of people 80 and over will quadruple to 395 million by 2050.
  • Within five years, the number of people 65 and over will outnumber children under 5.
  • By 2050, older adults will outnumber children under 14 and more than 2 billion people will be 60 or older.

Writing in the Washington Post, Michael Hodin, executive director of the Global Coalition on Aging, asks:

“Can it be a coincidence that, under the weight of this demographic transformation, the 20th century’s social contract is coming apart at the seams? With Greece, Ireland, Portugal, Spain and a number of U.S. states facing huge budget challenges, the consequences of applying last century’s economic and social policies to today’s demographic realities are stark.”

Hodin wants global aging on the G-8 agenda. He says we should be putting on a full-court press to promote pathways to healthy, active and productive aging before the elderly go begging or bankrupt us all. Profound change is needed to transform our expanding population of 65-year-olds from a liability into an asset—and so preserve the concept of retirement, if at a later age.

Global aging may not have the urgency of things like transition in Afghanistan, missile defense systems and the blockade of rogue states (as are on the summit agenda, for sure). But it’s a bell ringer nonetheless.

According to the National Bureau of Economic Research, population aging threatens global financial markets as the massive baby boom generation, which amassed assets for 40 years, spends them in retirement. According to an NBER study:

“When there is a large cohort such as the baby boom, there may be more demand than usual for corporate stock and other assets while the cohort saves for retirement. This demand may abate after the cohort retires. Some analysts believe that the rise in stock prices in the 1990s can be partially attributed to this, and have forecast sharp declines in asset prices in coming decades as boomers sell their assets to the smaller baby bust generation.”

A report out of South Korea notes that by 2050 the average age of its population will be 54, making it the world’s most elderly nation. The government there is looking at sweeping change, not just to keep older people healthy and working but also to promote fertility and to try to mitigate the demographic shift. The country is looking at wider social service reforms including subsidized childcare and family allowances. According to the report:

“Researchers found that there is a positive correlation between social investment and fertility rates. This means that women tend to have more children and contribute to the labor market at the same time when there are more social programs available.”

A report out of the U.K. notes that the elderly are fast increasing pressure on healthcare and social services budgets and that the key aim of government should be to encourage people to remain active, and engage in regular exercise and refrain from behaviors that are bad for their health. Personal savings is another hot spot. Societies must save to be able to allocate funds for investment for the future, in such things as factories, offices, transportation, schools, energy and hospitals. From the report:

“If older people don’t save or run down their savings while a smaller working age population does not save enough to compensate for the shortfall, then a shortage of savings could seriously affect economic performance.”

Hodin asks:

“What if we re-imagined what it means to age? What if middle age were 55 to 75? What if we enabled our innovations and technologies to position aging populations to drive economic growth? What if we redesigned the education process so it accounted for our longer life spans? What if we dedicated basic research-and-development funding to Alzheimer’s and cardiovascular disease, to vision deterioration and bone frailty? What if we followed the Global Network of Age-friendly Cities and Communities, where housing, transportation, social services and education are aligned to aging populations?”

Only then will a decent retirement be a realistic goal for most people in the decades to come. But these are not the kinds of changes that individuals or even institutions can bring about on their own. It will take governments working together out of common need. It’s a lot to expect. We might as well get started.

Source: Time

Latest Developments

We keep our members and partners in touch with the most recent updates and opinions in the worldwide dialogue on population longevity and related issues.

What Old Age Might Be Like for Today’s 30-Year-Olds

Get ready for a new old age. With the U.S. fertility rate in a decadelong slump and the life expectancy of 65-year-old Americans approaching roughly 85, our aging nation is likely to grow older by midcentury, as the ratio of young to old continues to decline. The trend is likely to upend how our society is organized, making life very different for today’s 30-year-olds when they reach their 60s compared with life for 60-year-olds now.

World Population Reaches 8bn As It Grows Older

The world’s population reached 8bn people on Tuesday and will hit 9bn in 15 years as it experiences an unprecedented surge in the number of older people, according to the latest UN data. The global fertility rate has more than halved since the 1950s to 2.3 births per woman. With mortality also falling, the number of people aged 65 and over is expected to rise from 783mn in 2022 to 1bn by 2030 and reach 1.4bn by 2043, the UN population data revealed.

Global Coalition on Aging (GCOA) Launches Cross-Sector Alliance Committed to Health Innovation at High-Level Forum on The Silver Economy

Today, the Global Coalition on Aging (GCOA), along with cross-sector stakeholders representing patient advocacy, policy, industry, and academic communities, announced the launch of the Alliance for Health Innovation at the High-Level Forum on the Silver Economy in New York. The Alliance is dedicated to establishing the importance of innovation in achieving healthy aging and health equity through investments, policy reforms, and strategic partnerships.

Japan Must Face Up to Growing Danger of Drug-resistant Germs

In the wake of more than 6.4 million COVID-19 deaths worldwide and unprecedented economic destruction, the global community has no excuse to be caught unprepared for the next pandemic. Yet right now, a devastating parallel plague is already underway and worsening. Some years, it is killing well over 1 million people, according to medical journal The Lancet.

A Bipartisan Bill Could Prevent The Next Pandemic

In Washington, Republicans and Democrats are typically at loggerheads when it comes to healthcare policy. Just consider the recent Inflation Reduction Act, which made extensive changes to Medicare and also extended Affordable Care Act subsidies. Every single congressional Democrat voted for the legislation, while every single member of the GOP voted against it. But occasionally, a bill is such an obviously good idea, and so desperately needed, that it commands significant bipartisan support. The PASTEUR Act, co-sponsored by 31 Democrats and 31 Republicans in the House and two members of each party in the Senate, is just such a bill.

Korea Must Act Now to Combat Growing AMR Threat

Public officials are overlooking one of the gravest long-term threats to the Korean people, the health system, and economy: antimicrobial resistance (AMR). Some pathogens ― bacteria, fungi, parasites, and viruses ― have evolved strains that resist the antimicrobial medications we currently have available to fight them. Health care professionals often must watch helplessly as patients succumb to infections that antibiotics could once have easily beaten. They know that new antimicrobials, including and especially antibiotics, could easily gain the victory ― but they have none at their disposal.

Policy Statement on the Impact of Price Negotiations on Innovation, Healthy Aging and Equity

As the CEO of the Global Coalition on Aging (GCOA) and a newly formed cross-sector Alliance for Health Innovation, we write to express our deep concern with the current legislation that allows for price “negotiations” in Medicare – a thinly veiled signal for America’s plunge into price controls that will have a devastating and adverse impact on biopharmaceutical innovation and our nations’ ability to support healthy aging.