At the core of this week’s economic news – President Obama’s fiscal 2013 budget and the Greek debt bailout – is a political unwillingness to be honest about the changes needed to our social welfare contract, something that was created literally in an earlier century. Today, neither the American insistence on continuing the entitlements of the 1960s nor the notion of Greeks retiring in their 50s is truly feasible.
We need to work longer – that’s an obvious solution. Too often, it’s the exception. Sometimes, though, when pop culture points the way, others will follow, if only because it’s “cool” to do so. Some of the most iconic bands who won our hearts years ago – the Rolling Stones, the Beach Boys, the Chieftains – are now paving the way for active aging, still working well into their 60s and 70s as they celebrate their bands’ 50th anniversaries. And older boomers are filling up arenas and buying $45 T-shirts by the barrel.
Consumer demand that drives economic activity connected to aging populations is certain to help solve the problem of paying for our new longevity. The spending habits of aging workforces and aging populations may indeed be the path out of a situation some have called perilous, as noted in the recently published book Global Population Aging: Peril or Promise?
“Global aging, in developed and developing countries alike, will dramatically alter the way that societies and economies function,” notes the summary. “The issues include how individuals find fulfillment, at what age they retire, and their quality of life once they do retire; how governments devise social contracts to provide financial security; how the older and younger generations interact as they divide up the economic pie; how businesses staff their jobs to compensate in many countries for shrinking workforces; and how health systems respond to the altered needs of those living longer.”
Eminent emeritus professors in the United Kingdom, by some accounts, are producing their best work in their 70s and 80s. Unburdened by tenure requirements, they are free to use their lifelong learning to explore new directions of thought, more time to teach, mentor, and review work done in their fields.
Our 21st century’s longevity is also creating demand for new jobs in health care and care-giving. What all these examples have in common is the virtue and value of market forces that allow demand to drive work to replace old-age dependency and costly retirement benefits – and in the process actually keep us healthier as we age. While the Davos cognoscenti were right to ask whether this demographic transformation of our time will result in “peril” or “promise,” when the likes of Mick Jagger are voting with their life-styles, my money long term is on the “promise.” Our challenge is whether we can bring forward that longer term culture and social shift to have impact on the attitudes of workers in Greece and, equally, President Obama’s budget.
Michael W. Hodin, Ph.D., is Adjunct Senior Fellow at The Council on Foreign Relations, and Executive Director of The Global Coalition on Aging.