03 March 2013

Aging

Wonkblog | Ezra Klein | How the aging of America is hurting the Republican Party

As Ed Kleinbard, a tax professor at USC, points out, the share of the country over 65 will increase by a third in the next 10 years alone. That means a greater share of the country depending on the government — and, worse even than that, a greater share depending on the government for expensive health-care services.
(1) This is true.

Demographic changes are both inevitable and very, very influential. We've been ignoring them to our own detriment. No, scratch that last. Instead of simply ignoring them we've been actively initiating policies which will make them worse.

(2) This is begging the question.

Aging is inevitable; dependence is not. Being over 65 does not inexorably entail dependence on government. Klein implicitly and entirely rejects the idea that people might provide for their own twilight.

(3) This is only a small piece of the picture.

The problem is only partially that a growing cohort will be dependent on the state. The problem is that there will be just as many people consuming but fewer producing. This is true whether we have enormous social spending programs, or everyone fends for themselves. Almost everything you consume in a given year must be produced by someone working in that particular year.

This aging trend is only exacerbated by the parallel trend of younger people who do not begin producing until later and later in life, especially given that they have often already consumed large quantities of resources in the form of "higher education."



PS Bonus point #4: I would not be so quick to conclude this demographic trend will hurt the Red Team more than the Blue Team. The latter will be forced, for instance, to choose between paying the pensions of retired public sector workers and maintaining spending levels on programs for the poor, for children, etc.

2 comments:

  1. "Almost everything you consume in a given year must be produced by someone working in that particular year."

    Yes but the definition of "produced" can change over time. Robotics and automation change "produce" from "milk the cow and thresh the wheat" to "own the cowfarm and the wheat-threshing equipment". With 3D printing just appearing on the horizon, that'll be another great leap in getting rid of "must be produced by someone [else] working in that particular year"


    Quite right you are about Red vs. Blue. It'll make me unpopular to say this, but Dems are extremely vulnerable when the continuing rise of automation kills even more jobs. Why? Because right now men disproportionately work in productive (=automatable) positions while women work in nonproductive positions (=employed for the sake of empowering women). That's going to eventually lead to a counter-feminist revolution and it isn't going to be pretty for Team Blue.

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    1. On your first point, yeah. You're right. But that just boils down to "productivity is/will/should rise." I totally agree that if we need N producers to support M consumers now, we'll need <N workers to do so later. However, I worry that actual productivity growth won't keep up with what we need to counterbalance the falling workforce participation and rising consumption expectations. Especially considering how much capital is "invested" top-down in non-productive bullshit projects like street cars and pre-school programs.

      On your second point: yes. I'm not sure how much of a counter-revolution there will be, but that's exactly the dynamic we'll see. I think it's fairly inevitable that we'll return to patterns of work that were common at most times before the last two generations: one spouse working outside the home, one inside. Also, potentially lots of people being paid for domestic service. I'm not sure how that shakes out politically, but I think it'll happen.

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