Thursday, March 16, 2006

Impact of ageing in USA?

How will the world's largest economy be impacted by an ageing population. Well, it is an important question to which I do not know the full answer but lets give it a go anyways. A recent report from the US census bureau gives us all the relevant data and previsions; get the full report here (warning; huge PDF file - 254 pages).

"The face of aging in the United States is changing dramatically — and rapidly, according to a new report from the U.S. Census Bureau. Today’s older Americans are very different from their predecessors, living longer, having lower rates of disability, achieving higher levels of education and less often living in poverty. And the baby boomers, the first of whom celebrated their 60th birthdays in 2006, promise to redefine further what it means to grow older in America.

“The social and economic implications of an aging population — and of the baby boom in particular — are likely to be profound for both individuals and society,” says Census Bureau Director Louis Kincannon."

Reading through the narrative of the highlighted trends the ageing population is clearly given a positive spin. The main focus is that the old people of the future will be richer, healthier, better educated and longer living than their predecessors. This is obviously a good sign but will this fact cushion the more broad societal and economic effect of an ageing population which we have pointed to in the context of other countries. Is this in fact like the US economy where dark matters make trade deficits go away and where budget deficits are justified through the venerable Arthur Laffer? Is the American society really so resilient that nothing can shake its foundation?

Admittedly, the demographic study might not have been inquisitive about the impact of ageing on the US economy at the offset, but below in the comments you now have the chance to give it a more critical spin than the one I think it is given.

1 comment:

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