Baby boomers fret about the rising cost of aging

Posted by Jennifer C. Kerr, Associated Press at http://www.philly.com/philly/news/nation_world/126466793.html

WASHINGTON - The "golden years" may lose some luster for many baby boomers worried about the financial pressures that come with age. Many of the nation's 77 million boomers are worried about being able to pay their medical bills as they get older, a new poll finds. The concern is so deep that it outpaces worries about facing a major illness or disease, dying, or losing the ability to do favorite activities.
Another major concern among the boomers: losing their financial independence.
The struggling economy, longer life expectancy, increasing health-care costs, and challenges facing Social Security are putting added pressure on boomers, those born between 1946 and 1964.
According to the Associated Press-LifeGoesStrong.com poll, 43 percent of boomers who responded said they were "very" or "extremely" worried about being able to pay for their medical costs, including long-term care. Almost the same number, 41 percent, said losing their financial independence was a big concern.
"I always say I am going to work until I'm in the ground," said Ellie Krall of Manalapan, N.J., one of the boomers polled. "I don't see myself being able to fully retire like people were able to do years ago."
Krall, 50, manager of an orthopedic office and mother of an 18-year-old son in college, said she's worried about paying for health-care costs down the road and isn't banking on Social Security.
The oldest boomers turn 65 this year, but it's the younger ones like Krall who might be feeling more apprehension.
"Boomers are not all created equal," says Olivia Mitchell, a professor at the Wharton School of the University of Pennsylvania and executive director of the Pension Research Council.
Many older boomers still have a defined-benefit pension plan, probably some decent retiree medical insurance, and Social Security, said Mitchell, a boomer who has studied pensions and retirement extensively.
"The youngest boomers - the people who were born in the '60s - face more uncertainty about their pensions, their Social Security, their housing, and their medical care," Mitchell said.
Her advice: "Push your retirement back two or three or five years if you can. As long as you are still working, then you're not drawing down on your nest egg," Mitchell said in an AP interview.
The AP-LifeGoesStrong.com poll was conducted June 3-12 by Knowledge Networks of Palo Alto, Calif., and involved online interviews with 1,416 adults, including 1,078 baby boomers. The margin of sampling error for results from the full sample was plus or minus 4.4 percentage points; for the boomers, it was plus or minus 3.3 percentage points.

Ideas and demograpics

This following is taken from a Blog by John R. Weeks. His writing is intended to go along with Population: An Introduction to Concepts and Issues, by John R. Weeks, published by Wadsworth Cengage Learning. The latest edition is the 11th (which came out in December 2010), but this blog is meant to complement any edition of the book by showing the way in which demographic issues are regularly in the news

Friday, July 29, 2011

The Way Forward Demographically

This week's Science magazine (a publication of the American Association for the Advancement of Science and one of the world's most prestigious magazines/journals) is a special issue (Volume 332, Number 6042, 29 July 2011) devoted to an examination of "the opportunities and challenges created by demographic changes around the world." This issue is done in conjunction with the world's "achievement" this year of having 7 billion of us alive at that same time.

Although you cannot read the articles online without a subscription to the magazine, I strongly encourage you to pick up a copy at your library. The Sciencemag.org website does include a nice seven-minute video providing an overview of the world's population issues, and the introduction to the special issue lays out the problem:

Today these demographic patterns spark concerns, not of a single explosion, but of “cluster bombs” in rapidly growing countries such as Nigeria and Pakistan, which are hobbled by poor governance and limited schooling capacity and already have huge numbers of poorly educated young adults without job prospects.

 Debate continues over how best to address these and other problems and over whether rapid population growth is best dealt with by expanding family planning programs or implementing policies that will improve livelihoods and increase the education of girls and young women—or both. Still, many experts remain optimistic that with the right mix of policies, countries can harness the opportunities for economic growth and development offered by a young and educated workforce, congregating in dense, networked urban environments.

The [special issue] contains News stories by Science's staff and research assessments by leading experts, enhanced online with videos and dynamic graphics, explores these issues, many of which continue to split demographers.

Monday, August 1, 2011

The Demographics of Job Creation

One of the topics that keeps popping to the surface in the swirl of discussion around the debt ceiling and the deficit is: How do we create more jobs? More specifically, the observation is routinely made that Ronald Reagan was able as President to create jobs and reduce taxes at the same time. This of course ignores the fact that taxes actually rose several times during the Reagan administration before coming down, but setting that aside, Reagan was blessed by an unusually propitious age structure. He was the beneficiary of America's age dividend. The Baby Boomers blossomed during his presidency, providing a cohort of young workers (young = cheaper than older workers in most circumstances) without a large group of older people that the government had to pay for, and without a large group of younger dependents. During his administration from 1981-1989 the percent of the US population aged 15-29 was 27--higher than at any time since the end of WWII and it has not been that high since. The population aged 20-44 was 40 percent during his presidency--higher than at any time since the end of WWII and it has not been that high since.

 To give you a comparison, the peak of the age dividend for China was in the 1990s when the percent 15-29 was 30 percent and the percent 20-44 hit 43. The US did not have quite such a good dividend, but it was pretty good, nonetheless, and the US economy was strong enough to take advantage of it.

 We have a different age structure now than in the Reagan years (the percent 15-29 is down to 21 and the percent 20-44 has dropped to 34. At the same time, the baby boomers who were finding jobs back in the Reagan years are now thinking about retiring and that scares lawmakers to death (figuratively, of course, not literally). Different age structures demand different kinds of policies, so the constant reference back to the Reagan years is, unfortunately, badly misplaced

http://weekspopulation.blogspot.com/

The shift to find blame continues

Are Baby Boomers to Blame for the Crises published at CNN July 29th  by  Ed Hornick

The following is another attempt by the right to start to shift the agenda and to frame the crises in a way that allows the public to support the idea of having less. You will start to see more stories like this in Canada over the next months. Just be aware that the shift cannot happen without your support, so stay informed and be aware of hidden agendas by the right.

Washington (CNN) -- Baby boomers -- those born between 1946 and 1964 -- have been described as "the pig in the python" and the "sandwich generation."

They lived well, grew up in relative abundance and, some say, expected their Social Security, health care and government support to be there as they grew old.

Now, as the future of the country's economy is up in the air, is this group of 80 million aging Americans -- many of whom are sprinting toward retirement age -- the ones to blame for the nation's shaky economic system?

The answer is not so simple.

Baby boomers grew up during relative prosperity, from the economic boom of the post-World War II '50s to the "Me" generation of the '60s through the lucrative uptick in the Reagan '80s. And then there were the budget surpluses they enjoyed during the Clinton '90s.

As a result, many were able to buy second homes, take out loans at low interest rates, buy cheap gas and pump money back into the economy.

Life was good, many say, until September 2008.

In the last days of the Bush administration, the economy went belly-up, forcing Washington to bail out Wall Street in order to prevent another Great Depression.

"Keep in mind that our parents who lived through the depression understand what adversity looks like. I'm not sure baby boomers know what that looks like," said David Cork, a demographer and baby boomer himself. "So maybe we got a bit of a taste for it two years ago."

Cork, a Canadian businessman and author of the book "The Pig and the Python," said the American economy has been thriving especially in boomers' formative years, "so they're not used to adversity."

"It's not because the boomers are a nasty generation. It's just that there's a lot of us, and we have a tendency of wanting to get it our own way," he added. "I think we've been very successful at that. We've created great wealth, but we are looking at it at a time when you have to pay the piper."

An analysis of data from the past three censuses shows that because of baby boomers' "aging in place," the population of those age 45 and over grew 18 times as fast as the population under age 45 between 2000 and 2010, said William Frey, a demographer and senior fellow in the Metropolitan Policy Program at the Brookings Institute.

Frey's report also found that the baby boomers (or "pre-seniors," as he called them) are "growing rapidly in all areas of the country," including college towns like Austin, Texas, Raleigh, North Carolina, and Madison, Wisconsin.

Regions experiencing the fastest senior -- age 65 and older -- growth are in the Sun Belt, which stretches from Western states such as California and Arizona east to Florida, according to the report.

Frey, also a boomer, said that although his generation is not necessarily taking the entitlement programs that their parents are, they can see what's coming down the road.

"They're not trying to skim off money from everybody else," he said. "It's just that these are issues that are now front and center for them where they weren't before."

Still, as a generation, they will have paid less into the Social Security system than they are expected to take out. According to a report from the Social Security and Medicare Board of Trustees, the Social Security system is expected to be solvent until about 2037 -- largely because of the surplus in the Trust Fund -- even though the payroll taxes flowing in stop being enough to cover the expenses flowing out in 2017.

Thomas Firey, a senior editor at the conservative Cato Institute and member of generation X, said it's unclear as to what's going to happen to Social Security.

"Under current law, what's supposed to happen is once the trust fund runs dry, the benefits are to be cut by roughly 25% to bring it back into balance. Each year's income will equalize the outflow," said Frey, who wrote a 2001 column titled "Boomers Fleece Generation X with Social Security. "But no one expects that to happen. (So) are we going to raise taxes on current workers? Are we going to get rid of the tax?"

But criticizing baby boomers is not necessarily a politically wise thing to do, especially when it comes to their voting behavior. Older voters consistently turn out in elections and are a key demographic for politicians on both sides of the aisle.

Jerry Shereshewsky, the self-described "chief grown-up" at the firm GrownUpMarketing, is a baby boomer. The 65-year-old said it's not his generation group to blame, it's Congress'.

"It was not a secret that this largest cohort in American history was going to get older every year," he said. "The fact that Congress has not done a very good job of keeping up with what is really happening in the world: life expectancy, better medical care. You give people a lot of cake and ice cream, they're going to eat it."

Frey added that any good demographer would have told you 20 years ago that "we would be hitting the wall around now. But it hasn't seemed to sink in for folks on Capitol Hill or anywhere else."

Shereshewsky also issued a stern warning to those in Congress who may blame boomers for today's economic problems.

"If you want to look through the telescope and say who should be getting beaten up here a little bit, I would say every member of the legislative branch for the last 30 years should be taken outside and spanked, because they did really stupid things," he said. "Why did they increase these benefits? They get votes. Why don't they raise taxes? They're afraid someone's not going to vote for them."

David Certner, legislative policy director for the AARP, said the country got into its debt mess not because of older Americans but because of Washington's out-of-control spending.

"The problem we're in today was caused by things we've done in the last two years, in particular engaging in two wars that haven't been paid for in any way, shape or form -- as well as the fact that we've had a significant drop in revenues partly as a result of our changes in the tax laws," he said.

Certner added that it's the rising health care costs that should worry all Americans.

"Health care costs are burdening people right now who are trying to pay for it. ... We need to get the whole health care cost problem under control, because it really does put a crimp on the rest of the economy," he said. "People who are working now are probably seeing their wages go up slower because more of their money is going to health care costs."

And that's something 23-year-old Jordan Balkin is finding out, at least when it comes to how much comes out of her paycheck for entitlement programs.

"It's a little less than 1%. But when you add it up, it's about $100, which would be nice to use towards other things, especially not knowing if I will get a chance to see that money in the future," said Balkin, who works in social media in Washington.

As for whether she's worried about her own retirement, Balkin -- part of what's described as generation Y -- said she can only hope that some of the money will be returned. For now, it's all about the present.

"I just keep thinking about saving for the near future when I want to have a family, buy a house," she said. "I mean, there is that offhand dream that I'll win the lottery -- hey, someone's got to be a winner."