January 4, 2005
WILL YOU STILL NEED ME, WILL YOU STILL FEED ME?:
A Tale of 2 Systems: An aging population is a challenge in the U.S. but could
spell economic paralysis for Europe. (DAVID BROOKS, 1/04/05, NY TIMES)
Populations in the U.S. and Europe are both aging, but Europe is aging faster. According to the O.E.C.D., the dependency ratio - defined as the number of people over 65 as a percentage of the number of people 20 to 64 years old - will rise to 37 percent from 22 percent in the United States by 2050. But it will go up to 52 percent from 26 percent in the European Union.In addition, European public pensions are more generous and retirees are more reliant on them. To sustain these programs, European government spending will have to rise. According to the European Commission, demographic trends will push public spending up by five to eight percentage points of G.D.P. in the E.U.'s 15 richest members. In Germany, public spending on pensions will rise from an already huge level, 10.3 percent of G.D.P., to 15.4 percent by 2040. And that's after recent benefit cuts.
To pay for all of this, taxes will rise and public debt will increase. A Standard & Poor's survey predicts that France and Germany could see their public debt grow to more than 200 percent of G.D.P. by 2050.
Europe may find itself locked into a vicious circle: an aging population means more public spending, which means higher taxes, which means lower growth, which means higher unemployment, which means more public spending, which means more taxes and even lower growth.
May? Does anyone really think folks too selfish to have families will give up benefits from strangers? Posted by Orrin Judd at January 4, 2005 9:33 AM
Many concepts contribute to this situation and the inability to change it. Egoism certainly. But another lingering concept is the old leftist belief that "wealth" is somehow "out there" just waiting to be attached and deployed. Why painfully alter bahavior if this false hope beguiles?
Posted by: LUCIFEROUS at January 4, 2005 11:12 AMI've read from market/economic types that unemployment will trend to zero with the noted demographics. I wonder who doesn't know what they're talking about?
Posted by: KindaBlue at January 4, 2005 12:39 PMWill a dwindling number of European workers be willing to support a bulging population of elders? Based on their past behavior, I doubt it. When a summer heat wave hit Europe not long ago, the aging and infirm died by the thousands alone and uncared for in un-cooled apartments while their French and German and Swedish offspring splashed on Mediterranean beaches. Eurosocialists love to look down their noses at stingy, stupid and unilateral Americans. But nothing comes between a European and the one thing they most cherish: undisturbed leisure. They seem perfectly happy to sit in their cafes drinking and smoking and making snarky remarks while their society crumbles. I say let them sit. Thankfully, my forbearers had the gumption to leave.
Posted by: jsk at January 4, 2005 12:41 PMThis population theory is nonsense. A fall in birthrates leading to increase in pensioners has the obvious (unless you are a european intellectual) concommitant of a decrline in the number of children in society.
Children recieve financial support from tax payers for an average of six years more than pensioners. Properly computed, the tax burden imposed by maternity, healthcare and educational provision for under sixteens, is greater than that imposed by pensioners. The falling population will create more wealth. The problem is that Western governments will syphon of the wealth to fund vanity projects, African aid etc.' instead of redistributing it to pensioners.
Population decline is promoted, as a theory, by arrogant left-wing, utopian European elites, to justify mass-immigration.
Posted by: Calvin at January 5, 2005 6:42 AMCalvin, you prattle.
Posted by: Randall Voth at January 5, 2005 7:07 AM