Replies to post #24731 on Zeev's Turnips Patch-No Politics (ZEEV)

[Train Guy]

Certainly doesn't look like a spike, but then maybe it spiked up and then stayed at the new level. And you probably aren't seeing as fast a drop off in older people. Would need to look at the earlier data.

[kevinb]

Ergo,

That's an interesting table. Can you provide a link to your source or could you confirm some of the numbers. Perhaps something was lost in formatting but the comment

Total population 281 421 million
(in thousands)

seems to read that the population is 281 Billion which is too high, also the following breakdown if its in thousands is also too high. If its not however the figure for over 85's at
4 239 is quite striking. If I do the math right it seems to imply that only 1 in 50,000 of the population will ever exceed that age, which seems low.


Re: you comment on the Boomer problem. A few weeks back the Economist did a big article on this. It highlighted the surprising finding that America's population growth has grown from a 70's low of 1.4 almost back to the replacement rate (2.1). This is in stark contrast to Europe where it has continued to fall and is now down around 1.2 This will reduce some of the boomer issue but with a median age of 35, there is still a rather unbalanced population profile.

Life expectancy is also changing. I heard that some studies done by the insurance industry conclude that children born today will have an average life expectancy of 120 years. This in crease in expectancy will be mainly due to medical intervention. Some of this will be applied to someof the ageing boomers as well so that will also extend the problem.



Kevin

[Lane Hall-Witt]

ergo sum--

The problem isn't one of absolute numbers, but of the ratio of retirees to workers -- specifically, of people drawing Social Security benefits to people paying into the Social Security fund. In 1960 there were about 5.1 workers per retiree in the U.S. economy, currently there are about 3.4 workers per retiree, and the number is projected to drop to about 2.1 workers per retiree in 2030.

Additional projections include the following:

(1) Annual Social Security tax receipts will exceed annual Social Security payouts until 2016, when expenditures will be greater than tax receipts.

(2) Annual Social Security Trust income (tax receipts plus interest) will exceed annual Social Security payouts until 2025, when expenditures will be greater than income and will initiate a drawdown of the Trust.

(3) The Social Security Trust will be depleted in 2038. Ongoing tax income will cover 73 percent of promised benefits, continuing down to 67 percent in 2075 and heading even lower from there.

Of course, we know all too well that government projections are fallible; but the general demographic trend seems firmly established, and the financial consequences follow from the demographic constraints.

A useful document on all of this is the Social Security Advisory Board's 2001 report, "Why Action Should Be Taken Soon" (650+ KB):

http://www.ssab.gov/actionshouldbetaken.pdf