Tom Matlack looks for a reasonable solution to America’s old age problem.
I had dinner with a good friend the other night. His most recent girlfriend is one of the country’s most expert setters of “back” fires.
“There are very few people who can do what she does,” my friend explained. “And she’s like 5’1” too.”
Her talent is to set the fires behind a major wild fire to clear flammable material and thereby control the spreading wildfire. It’s a treacherous vocation because her small fires, it not set properly, can just add to the destruction of the main wild fire. “She just disappears for days at a time,” he said, “and then one morning she just shows up at my front door completely exhausted.”
I found this discussion of the superwoman firefighter fascinating, but that wasn’t my friend’s real point. As the stock market plummeted another 500 points, the topic of discussion was the economic calamity hitting our country—not global warming causing more and more out-of-control fires. The woman setting backfires was just one more example of my friend’s problem. He’s a techno-creative type who had done well in an unconventional career path that led to a nice, but not extravagant, place in the hippie community of Topanga Canyon, steady income, and a retirement nest egg saved carefully over decades of work.
“You know what happens when she’s put in her federal years of service?” he said. “You, Tom Matlack, of Brookline, Massachusetts are going to have to pay her a big fat federal pension.” He paused for dramatic effect. “For life. Me? I just have to keep working my ass off to get what we all are going to be paying her once she hangs it up.”
My buddy went on to recount how a mutual friend of ours had served as a Los Angeles city counselor, making $175,000 a year for his four-year term. Upon leaving office, he then received a $150,000 pension.
“You guessed it. For life,” he said. “I mean. I’m thinking about running for city counsel right now. There’s a vacant seat.”
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This conversation got me thinking about what is really causing the latest financial crisis. Whether it’s the state of California, the car industry, or the United States government, one of the biggest factors is over-promising to take care of an aging population.
According to the National Center for Policy Analysis, the unfunded liability associated with Social Security and Medicare is over $100 trillion.
State budgets, major corporations, and unions are all suffering under the same weight, trying to live up to uncapped liabilities associated with more people living longer.
Life expectancy in the United States has increased from roughly 50 to 80 over the last hundred years. A number of companies (notably Sirtris Pharmaceutical, which focuses on the Resveratrol found in red wine) are promising to extend life even further.
Meanwhile, as Atul Gawande explains in “Letting Go,” Americans are obsessed with not-dying. We expend huge sums on the very last months of life. Gawande’s research points out that hospice care—making death more comfortable, rather than fighting the inevitable—is vastly cheaper, more humane, and ironically leads the dying to live longer.
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My buddy’s mantra: It’s all about the pensions. And the more I think about it, the more I think he is right.
My proposal: a reconciliation of our financial responsibility to each other and a much more frank conversation around the length and quality of life in our country.
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It’s also about wealth disparity, racial inequity, and educational opportunity. But in terms of the near-term financial crisis in federal and state government, it really is about the aging of our population and how to live up to the promise we have made to pay for health care and the general well-being of people we once would’ve expected to be dead already.
I am going to steal a bit from Ernest Hemmingway, throw in a little Atul Gawande, and get radical on you, poor reader.
I’m 46. I’ve had a good run so far and sure hope I have a few decades left in me. I’m in good medical health. (Mental health is debatable but not life threatening). So, unless I get hit by a car or struck down by a rare disease, I’ll probably make it to 80. (Remember: 80 is the overall average age, but once you have made it to 46, you have slipped by a bunch of bad shit that could have killed you, so your actual life expectancy at 46 is higher since you take out all the people who died young and brought down the overall average.) And I don’t plan on retiring until they pull the plug.
Like most people my age, there have been those times when I seriously could have died if things had gone just slightly differently. I’m still here and grateful to be able to hug my family. But I am not afraid to die. What I care most about is the quality of my life. My paternal grandmother lived to be 99. She didn’t want to, but her body kind of just held the pieces together. She started talking about wanting to die more than a decade before she did. I admire her courage in the face of that adversity but don’t want it for myself.
My proposal: a reconciliation of our financial responsibility to each other and a much more frank conversation around the length and quality of life in our country. Yes “pensions” and Social Security may be the problem, but as long as there is absolutely no ability to even raise these issues, we are all going down in flames.
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“If these people want to keep their pensions they have to take up smoking—a lot,” my friend suggested. But really, this whole idea of retirement at 55 or 65 is pretty absurd. So we are supposed to spend 25 years, from 55 to 80, bankrupting our kids, while we play checkers?
We are living a long time and, unlike prior generations, have the capacity to work for a lot longer. Not only do we have the capacity to work, but also I think we need to work to keep ourselves active and engaged, contributing to the greater welfare of our country.
Let’s stop tinkering at the margin, adjusting the Social Security rate of inflation by half a point, and tweaking the retirement age by a year. If we are ever going to get anywhere, we have to face into the reality that people live a long time. We mistakenly promised to help support able bodied people do nothing, when they could be doing something productive.
So here’s how we solve our financial crisis in one fell swoop:
- Going forward, make illegal any defined benefit plan with an age trigger. Instead, make the support of “retirement” based purely on physical and mental ability. Support those who are incapacitated. Not those who are old but vital.
- Convert existing participants in defined benefit programs into lump-sum-defined benefit programs based on current financial assets. This way, a pension plan that has $200 million of liabilities and $100 million of assets doesn’t bankrupt the company to make up the difference. Give participants 50 cents on the dollar now, and shut the thing down. That goes for Social Security, too. And for any crazy city councilmen (or congressmen or Presidents, for that matter) hoping to get a big stipend for doing nothing forever. Give ’em all a lump sum and send them packing.
- Focus our health care expenditures not on extending life but on increasing the quality of life particularly for those near the end.
- Make having a living will mandatory so that extraordinary measures don’t have to be taken for those who don’t want them.
- For sick puppies like me, who have a low pain threshold and would prefer the old Hemmingway approach when the time comes, allow doctor-assisted suicide with the proper counseling and safe guards.
And, yes, if there are any pensions left after all of the above, ship the remaining participants crates of Marlboros and grain alcohol on a regular basis.
Enjoy life pensioners. And stop living so damn long.
—Photo rileyroxx/Flickr
My comment did not appear so far. I wonder why it was deleted (?). I merely said, it is wrong to keep old people responsible for high medical fees. USA has the highest medical fees in this world, and it should be checked out why this is the case. I also said, that most men – according to the statistics provided by the author of this article, do not live up to 80 years old. Only white women have a life expectance of 80+, but black men are listed to be dead when only 69 years old. I also don’t… Read more »
The thing about pensions is, however unreasonable they are, they were promised to people. If someone held up their side of the contract and did the work, how can we take away what they earned?
In many cases, the pensions are for jobs that are dangerous and demanding. I don’t mind paying a pension for life to someone who’s put her life on the line fighting fires for me.
What about people who are still healthy, but not healthy enough to do the jobs they did when they were younger? It’s a lot easier for people in professional jobs to go on working forever.
What about employers who don’t want to hire people over 50? We have a lot of long-term unemployed people in that age range now.
Length of life and quality of life are very separate, as you point out. I fully agree with you…money should be spent in making the last days as comfortable as possible, not just lengthening the lives of people who have no (or seriously reduced) quality of life.
“Killing Grandma” is to liberals what “killing the unborn” is to conservatives. The more people say it, the more they contribute to the disparagement of Social Security.
While I see his logic, I don’t know that I necessarily agree 100%… I mean, most other wealthy countries have higher life expectancies and are not as bankrupt as the US. So to blame it all on Social Security seems a little ridiculous to me.
The pension schemes of most other industrial powers subject all wage income to the tax which funds the pension. We don’t. This is one reason why Obama’s payroll-tax holiday was a bad idea.
There’s also the “Logan’s Run” model, which is highly efficient from an economic standpoint….
Great article! The institutional lag between retirement age and life expectancy isn’t just a financial problem, it’s an identity problem. We have to redefine old age and what it means in terms of social roles, because study after study indicates that the level of functioning from 55-80 years old is a lot closer to middle age than it is to old age (80+). Yet there is this stereotype that people over 60 are greedy geezers with not much to contribute in return – totally not true.
If you own a business, staff it exclusively with people over 60. Let me know if you do. You’d be an anomaly.
Yeah, good point…I’d probably have to confront my own attitudes about aging if I were in a position like that, and maybe I wouldn’t like what I see in myself. But that was the point I was hoping to make, really: the debate is addressed from a financial perspective (of which I know squat), but it’s also a question of our cultural attitudes about aging, and whether we have misconceptions about a very huge percentage of the population.
Let’s differentiate between Social Security and generous government pensions. Social Security isn’t all that generous, and it’s not an entitlement. It’s an insurance policy many of us have paid into. I’ve paid into it since 1962. The financial problems can be easily fixed by increasing the contribution, setting the retirement age a bit higher, or both. Also affluent members can pay more. I’d dump the current insanely generous government pensions into Social Security. Maybe make the payouts a bit more generous (to all.) As for Medicare, we need stringent managed care (like Oregon’s) to control procedures especially. You get one… Read more »
This distinction you call for is reasonalbe and apt. I don’t doubt the reforms you write of can, for the most part, be realized—-if people stop acting like Social Security is a contagious disease. I, too, think government pensions should never exceed that of the maximum Social Security disbursement. I also agree that Medicare—-the real budget buster—needs to stop being geared to prolonging every life. No ‘hero care’ should be taxpayer-funded after one reaches one’s actuarial age-ceiling. Having said this, I stand by the deeply felt bellicosity of myself and millions like me. We are the people who know you… Read more »
I agree with you on Social Security, but not Medicare. Deciding who is worthy of life-saving measures is a moral nightmare we should avoid. Even from a scientific point of view, it’s not easy to figure out (as time goes on, a procedure like a bypass becomes easy and effective).
I see no moral quandary involved in saying, “Society owes no one life, on an ad infinitum basis.”
Tom, you can refuse your share of Social Security when the time comes, but if you think the mainstay of most old people should be shut down and recipients paid off, then you can go fuck yourself. And you can go fuck the horse you rode in, while your at it. Your friend can follow suit. Most of my neighbors in the dilapidated building I reside in here in Minneapolis, live on less than $1,100 a month on Social Security. Most of them probably conducted their lives much more honorably than your sorry, ex-lush ass. They raised kids, never got… Read more »
Hemingway ended it himself, though. And that’s tough to do if you’re not bipolar.
Tom, You seem to have fallen into the pervasive trap of the life expectancy myth. The major reason for the increase in life expectancy in the 20th century is the dramatic decrease in infant and child mortality and the successful treatment of infectious diseases. A woman retiring in 1940 at 65 could expect to live 14.7 years. At age 66, I can expect to live 19 more years. Shockingly high youth unemployment and the difficulty of finding work in your 50s and 60s suggest that raising the retirement age in not the solution. Besides, it has been raised to 67… Read more »
I’m all for working well past 65 but try finding at job at my “ripe old age” of 59!
The real crying shame is the people like that city counselor who collects a ridiculously high pension for doing basically nothing.
Once you reach that age… you will be terrified of death yourself. You will have to counter blog this post – you will probably regret saying ‘stop living so damn long.’.