The budget battle in Wisconsin now exploding in Ohio is just the latest political eruption of what we saw last year with the Greek debt problem. What these battles have in common is the underlying structural dilemma of trying to fit 21st-century retirement and health care realities into 20th-century institutions.
This sea change, of which the Wisconsin budget struggle is only the tip of the iceberg, brings home the reality of aging populations. As David Brooks noted in his column on Tuesday, “Given the scope of the fiscal problems, it could be like this for the next 10 to 20 years.” We should be so lucky. Unless there’s a more profound shift in the relationship between the public fiscal condition and the entitlement culture, these battles will be part of the political landscape well into mid-century, and not just in America, as recently reported by the World Bank. It’s the disconnect between longevity and lower birthrates on the one hand and current public spending on the other, which includes assumptions that predate our current aging population era.
Solutions to what could be a fiscal nightmare will come in different forms, including short term fixes, as we’re seeing in Wisconsin, to balance the budget today and begin to account for the 21st century’s longevity. People will work longer as we become accustomed to longer lives. Another path can be found in connecting aging to innovation, as in Europe or across the globe, through such initiatives as the WHO Age-Friendly Cities plan, which envisions technology, social programs and culture coming together to support a life course of learning and work into our eighties.
Critics of governors Walker and Kasich are right that this is about much more than money. It goes to the very heart of the new social and economic institutions driven by today’s technology, information and aging populations. Now that’s what we can call change.
Michael W. Hodin, Ph.D., is managing director, the High Lantern Group, and an adjunct senior fellow at the Council on Foreign Relations.
Click here to visit the Age and Reason home page.