One of the reasons for the fascination which Michael Jackson exerted on
crowds, beyond his immense talent, was his obsession to become someone else
and to stay young. And it is particularly in tune with “l’air du temps”, in a
world where all the populations, not only those in rich countries, are
aging. Or rather living longer. Hence the desire to stay young, attractive,
active, mingling with the world. Strange contradictory obsession, with the
refusal, so general also, to work longer.
And yet we must face the fact: when, in the most developed countries, the age
for retirement was set at age 65, life expectancy was not much higher then.
Today, in the same countries, we stop working before age 60, and we live 30
years more. Obviously, the financing of pension plans cannot remain what it
was. It is even insane to see we have let such a gap accumulate without
finding a remedy, by the two methods of financing: distribution and
capitalization.
The distribution method is not balanced anymore: because of aging and the
collapse of the birthrate, there will be soon less and less credits to
finance more and more pensioners (2 to 1, instead of 4 to 1).
The capitalization method is also abused by the financial crisis, which has
lost 20% of the value of assets of pension funds in all OECD countries,
that is to say 5.5 trillions dollars. Although not a major impact, (since,
for the most part, for future pensioners, the value of their inheritance
will have time to be restored), confidence in this system will not be back
soon.
Moreover, in both systems, the pensioners are likely to suffer from the
accumulation of national debts, , which can only be repaid by increasing
taxes and/or inflation, which will devalue the investments of savers and the
incomes of retirees.
Everything is thus set up so that the pensioners will be the main victims
of the future. To avoid this, it will be necessary to accept huge reforms,
without preconceived ideology.
Initially, it will be necessary to save more, longer, and in a more careful
way. It will be necessary to restore confidence in Pension Fund : indeed the
experiment shows that on average, in spite of the crisis, the value of their
assets have increased in the long term 7% per year, which should make it
possible to ensure a decent retirement on the long term. Specific, public or
private funds, in competition, will have to be developed, whether or not
attached to insurance companies. Their managers will have to obey a very
precise charter, urging them to remain very careful (in particular for the
investment of the savings of those who have to retire in the next five
years) and while not taking part in the development of structured finance.
The companies will have to contribute much more to these programs, on behalf
of their employees.
Then, demographic policy must be reviewed to facilitate growth in the number
of children, and, (at least while waiting for that policy to have some
results), to welcome more foreigners in age to work and contribute.
Lastly, as life expectancy in good health increases more quickly than life
expectancy itself, each one must have the right to work, voluntarily,
without age limit and the minimum age for access to retirement must be
fixed by taking into account the hardness of the work and the duration of the
contributions.
Undoubtedly, one day, we can even imagine a society where work will be so
rewarding that the main demand will be to extend the work hours. We are far
from it.