December 11, 2014


Why debates over inflation are pointless (Scott Sumner, 12/07/14, Library of Economics & Liberty)

Here's one thought experiment. Get a department store catalog from today, and compare it to a catalog from 1964. (I recently saw Don Boudreaux do something similar at a conference.) Almost any millennial would rather shop out of the modern catalog, even with the same nominal amount of money to spend. Of course that's just goods; there is also services, which have risen much faster in price. OK, so ask a millennial whether they'd rather live today on $100,000/year, or back in 1964 with the same nominal income. Recall the rotary phones and bulky cameras. The cars that rusted out frequently. Cars that you couldn't count on to start on a cold morning. I recall getting cavities filled in 1964, without Novocaine. Not fun. No internet. Crappy TVs, where you have to constantly move the rabbit ears on top to get a decent picture. Lame black and white sitcoms, with 3 channels to choose from. Shorter life expectancy, even for the affluent.

Age-old truth (The Spectator, 13 December 2014)

We are living longer, healthier and more prosperous lives than ever -- it's one of the greatest advances of our time, and yet our politicians prefer to see it as a disaster.  [...]

Who would have thought, for example, that pensioners would be driving the British job-creation miracle? David Cameron and Iain Duncan Smith rightly boast that there are more people in work now than ever. But we seldom hear that a third of the rise in employment is accounted for by the over-65s. There are now more than a million pensioners who are -- from choice or necessity -- working and paying taxes, twice the number of a decade ago. So it is rather simplistic to say that pensioners are an ever-heavier burden on working-age people. They are carrying a share of the burden themselves.

Norman Lamb's panicked predictions are part of a refrain that can be heard throughout Whitehall: 'Oh my God, we're all going to live.' Officials still make assumptions based on the bizarre premise that people become economically useless on the day they turn 65. Employers, on the other hand, are delighted to keep hiring a generation of people who have a strong sense of duty and an old-fashioned work ethic.

And this is just conventional work. How many young couples have their working (and personal) lives made much easier by support from their parents, who nowadays often have the good health and stamina required to let them provide a free taxi service and babysitting? The old line --  'Darling, let's have babies while our parents are still young enough to look after them' -- has ceased to be a joke. When people are healthier for longer, they are far more able to support their families for longer -- the importance of which is impossible to quantify. Improvements in medicine mean more people are active for longer -- helping the older generation, their families, their employers, their volunteer groups and society at large.

It is forgotten that today's pensioners are also fit enough to care for their own parents. Again, it's hard to put a figure on it, but Carers UK estimates that 1.3 million pensioners are caring for disabled or older loved ones, saving the economy £120 billion a year. And even these figures do not recognise the amount of voluntary work which so many people take up in their retirement. Nor do they factor in the most valuable contribution of all: the wisdom and love which is being passed down the generations.

Posted by at December 11, 2014 1:32 PM

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