GRAY AND IN THE WAY:

Gray Matters: In Japan, where one fifth of the population is now over 65, a preview of a global future. (Akiko Kashiwagi, 2/19/07, Newsweek)

Last December, a state-run think tank published a report noting that right now one out of five Japanese are over the age of 65--making Japan one of the oldest populations in the world. And the trend is headed up: by 2023, people over 65 will make up 30 percent of the population; by 2055, they will be more than 40 percent. For women like my mother, the news is even better: Right now the average life span for a Japanese woman is 85.5 years, and, according to a recent WTO study, by 2030 that figure will rise to 88.5. Meanwhile, Japan's impressive health-care system and healthy lifestyles have allowed seniors to live fuller lives.

That's the good news. The bad news is that these longer lives can mean greater costs for society as a whole. Retirees are often drawing on funds from the public purse while there are ever-fewer workers to pay into it. Already in Japan, a whopping 71 percent of total social-welfare appropriations goes to entitlements for the elderly. That's up from 59 percent in 1990, compared with a mere 25 percent in 1973.

The problem is not just in Japan, though the pace of aging seems not as fast elsewhere. In 2005, the elderly population accounted for 20 percent in Italy, about the same as in Japan, followed by Germany (18.8 percent), Sweden (17.2 percent) and France (16.6 percent), according to United Nations data. (The United States figure is 12.3 percent.) [...]

Last summer we watched in horror as TV news broadcasts announced that the government of Yubari, a rural town on the northern island of Hokkaido, was declaring bankruptcy because of its excessive debts. There was a time when Yubari was best known for its pricey muskmelons, which went for $10 a slice. But today it's famous for being Japan 's grayest city, where 40 percent of the population is 65 or older. Amid aging and loss of jobs, the city kept borrowing by stimulating economy using loans and subsidies in a manner typical of rural Japan. This summer, then, it revealed it had a huge hidden debt and was no longer capable of making its loan payments. Under a new workout program it's being forced to lay off workers, cut services and slash subsidies for the elderly.