February 19, 2013
TWILIGHT OF THE DRAGON:
No Country for Old Age (MARK W. FRAZIER, February 18, 2013, NY Times)
Entitlement programs like retirement benefits will inevitably force China into a trade-off between social expenditures and domestic security and military spending. Policy makers concerned about China's rising military spending would do well to monitor China's social spending. [...]A final obstacle, paradoxically, is the Chinese themselves, who (like Americans) strongly oppose an increase in the age at which retirees become eligible for full benefits. Chinese officials often argue that early retirement helps make room for young workers. But the current retirement age -- 55 for women (50 for those in blue-collar jobs) and 60 for men -- adds to the demographic burden. The one-child policy means that an ever-shrinking share of workers is paying the taxes that finance pensions and health care -- the demographic phenomenon that causes the Chinese to fear "growing old before getting rich."
It's just a bigger, poorer Japan.Posted by Orrin Judd at February 19, 2013 5:31 AM