Government Entitlements and Longevity Risk
Politicians in the developed nations long ago set themselves upon the course to financial disaster. Matters are accelerating now, but all along it has been about the growth of entitlements, and especially forced transfers to wealth from the (largely poor) young to the (largely wealthy) old. As longevity increases, the system becomes ever more bankrupt - and the sooner it breaks down the better. Nothing more is needed to fix these problems than for the hand of government to be removed. "First the good news: We're living longer, healthier lives than ever before. ... Now for the bad news: At this rate, we can't afford to live so long. And by 'we,' I don't just mean you, me and our often insufficient long-term-care insurance policies. I mean 'we the people.' I mean the bureaucratic 'we.' ... For the first time in human history, people aged 65 and over are about to outnumber children under 5. In many countries, older people entitled to government-funded pensions, health services and long-term care will soon outnumber the work force whose taxes help finance those benefits. ... How are the most developed countries handling preparations for the boom in the elderly population - and for the budget-busting expenditures that are sure to follow? For a majority, not very well."
Link: http://www.nytimes.com/2010/10/17/business/17stream.html