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Consequences of an Older Population
Consequences of Older Population
A consequence of the fast growing base of older people is a burden on the younger population for their upkeep.
They have to battle out all the dilemmas of the entire population on their own because the number of older people is growing at a rapid pace.
The ageing process has begun and will continue as life expectancy increases and especially in countries like Japan where there is little immigration and few children born each year. And even though this is a sign of a healthier age and the fact that women have more control over their fertility, this process comes with a lot of repercussions as well.
Firstly, as part of the population, the elderly need to be paid, and this comes as an expense. They can contribute to the prosperity of the nation, but they also need to be paid social security and health care benefits. Medical expenses of those over 60 are deemed to be quadruple those who are under 60 (Robin Blackburn, 2009)
As people live longer, the age threshold for retirement should also be extended. If workers are required to retire by the age of 60, they should be allowed to work by 70. However, this change is not going to be a rapid one since the ageing process is just creeping into our society and its problems are manifesting themselves in degrees as well. So if people are unemployed, and that too the older population with more health care needs, the burden will fall on the younger people of society, to cover up for them. Another problem that arises here is that in this world of ruthless downsizing, the burden falls on even smaller shoulders.
Also, pay-as-you go schemes and pension funding is a poor way to tackle this problem in this economy. There needs to be better funding of retirement plans. In this age, we need to uplift our financing and saving plans because we are undergoing an 'Age of Ageing' (George Magnus)
An economy needs young people, not rant about birth control. They are the future. And now it's staring us in the face that there will be a point that there will be older people than young. (Blackburn, 2009)
Older people still have the same needs as they age: they need shelter and food and medicines and care. And even if you are supporting your parents, or you put them in a good old home, these would increase in number as the number of older people increases rapidly. Their housing needs will be on your shoulders, and if everyone is old, who will support?
Also, an ageing economy will grow slower than one that does not have a massive elderly people base. And pensions will eat up all the benefits an economy might have. (Gruber et al., 2009) If pensions eat up the benefits, the already pressured younger population will get even few fringe benefits and will be working under extreme pressure with no reward.
The life-cycle theory of savings suggests that people spread out consumption over the course of their life. They spend less in the peak years of their lives and save more (20-50 years). And they spend more during the early and later years of their life. So older people will also be saving less, maybe selling their assets off and then they retire and do not return anything back to the economy. (Blackburn, 2009)
Political battles of programs for the elderly
State and federal governments are continuously lower and lower funds and they wish to give it to those who are in desperate need of it. Programs for the elderly like Medicare and Social Security are under a great watch.
The older American's Act came into play in 1965 so that the federal government was involved in community services for the elderly among many other things. According to the amendments made in 1978, those elderly would receive aid that had "greatest economic or social need."
This term was vague and it was unsure who was to be targeted. Would it be those suffering from poverty, or those who had low income as well? With each revision this term was made clearer, however the terms are still a little vague and the base remains vague as a consequence. Therefore, this program is battling out its due share from the political parties.
Medicare is another program centered on government financing low-income individuals. It was originated in 1965 and its purpose is to finance to people who qualify for it and cover a portion of their health care costs. The federal government's job here would be to subsidize the health care costs for these purposes.
No proper research has been conducted to give proof to the government that such programs are actually benefitting and are not an excuse to become lazy.
These programs to aid the elderly and low income groups are in a struggle with political parties because they need to be spread thinly and may not go to those with the due share. Also the government, though it is involved, is still in need of surety that the deserving are getting their funds since they are already pressed for them. And squandering of resources is what both parties are not looking for, but they need to be on the same page.
Other programs such as Welfare and Supplemental Security income are facing such political problems.
The issue is that most of these programs cater for more than one bracket of the needy. They might cater to the needy, or the low-income group. And since there is an on-going debate as to whether those with a low income should be supplemented, since this would hinder their desire to spur on and do better for themselves, overall funds are reduced. And since these funds are spread over the minority, and the elderly, and the disabled people, all three groups suffer, even the deserving.
There is a lack of realization that the ageing population is rapidly growing, and resources cannot be pooled with any other group of people because then the elderly will miss out. And since they have health care needs greater than others, as well as being retired and unable to work, this would be detrimental to society.
All the programs aimed to service the elderly should be fully supported by the government, state and federal, and they should look into where the money goes, and by what process and in due time. Keeping checks and balances is not the issue, providing adequate funding is.
In a case study on the "Supplemental Security Income Program and Material Hardship" (Patrickson and Hartmann, 1995) it was again highlighted that sometimes it was difficult to decide who was eligible to receive aid and who would decide that eligibility criteria? The Supplemental Security Program also includes providing aid to struggling single mothers. And when a large number of deserving people are grouped together, it is difficult to decide who deserves the aid more than the other, because each may have their own set of characteristics.
Another article in the Journal of Policy Analysis and Management showed that lack of supplemental income for the elderly especially those without any family backing or support were vulnerable and faced great financial difficulties without the supplemental income. And also that if the elderly were given SSI, it did not mean that they would be discouraged to work. It did not affect their motivation to work. (Kaushal, 2009)
Aftermath and Dealings of an Ageing Population
There are several ways in this day and age to deal with this problem of an older population as opposed to a younger one. They burden the young population, who has to work harder and longer to cover up for these deficits in society due to the ageing population. They have to support the elderly, grow, as well as support themselves and their potential families.
Population ageing has increased the Aged Dependency ratio (ADR) that is the number of working people to each retiree. The Australian government suggests privatization of health care to an extent and also privatization of pension funding. However, funding doesn't just make people better off. Some people are left behind. And in fact it can actually make everyone worse off due to the costs assigned to administer it. (Apps et al., 2007)
And since fertility has declined, the allocation of costs will be towards the elderly rather than those for mothers. There is only a change in the composition of the receivers, but there doesn't have to necessarily be an increased cost.
There should be an increased tax base, so that more funds go into health care benefits and providence funding. So that after the elderly are done working, they have a sufficient provident fund to sustain them and are not a burden on the economy.
Also, human resource management needs to modify a bit. Downsizing which was initially targeted towards the older employees mostly should be curbed. Also, they…[continue]
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