Newspaper article St Louis Post-Dispatch (MO)

Numbers Game May Catch Up with Us

Newspaper article St Louis Post-Dispatch (MO)

Numbers Game May Catch Up with Us

Article excerpt

Happy New Year - you're a year older. If it's any consolation, you're not alone. Collectively, we are the oldest humans who have ever lived, and we are rapidly getting older.

After thousands of years in which the age structure stayed constant - held in check by infectious disease and what now seem astronomical child and maternal death rates - the 20th century has seen a rapid shift. In 1900, less than 1 percent of the world's population was age 65 or older. Today the figure is 6 percent, and it is heading toward 20 percent by 2050. Among all the changes of this consequential century, this may well prove to be one of the greatest.

The United States is way ahead of the global curve. Those over 65 are already 12 percent of the population and may be 25 percent by mid-century. Unless Social Security and Medicare, the principal age-triggered entitlement programs, change commensurately, and very soon, we will march into a devastating financial trap.

The crunch will come about 2010, when the baby boomers begin to retire. In just one decade, while the population grows by 2 percent, the number of retirees will soar by 30 percent. Instead of five Americans working to support one retiree, there will be only three. There are three possible consequences: Deficits (federal and state) will balloon out of control no matter how much other programs are cut; those working will have to pay much higher taxes; or retirees will receive substantially lower benefits.

The fair and stunningly simple alternative is to raise the retirement age. When Social Security was enacted, life expectancy was only 62 - three years less than retirement with full benefits. Today, life expectancy is 76 and still climbing. With the same relationship today, retirement would be set at almost 80!

In 1940, an American could expect to spend 7 percent of his or her adult life in retirement. Today that has almost quadrupled, to 26 percent, and a long retirement has become a general expectation, if not a right. But how long?Smayorb

The logical fix is to link retirement age to growing life expectancy, either by periodically picking a rising age - 70 would be reasonable now - or by agreeing on a percentage - perhaps one-fifth of adult life that would be spent in retirement. …

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