The age of ageing


“Population ageing is unprecedented, a process without parallel in the
history of humanity.”

This strong statement comes from the Population Division of the United
Nations, the global authority on population data and policies. In a
little-noted document entitled World
Population Ageing 2009 the report also stressed that population ageing is “pervasive,
profound and enduring.” All countries are experiencing the same phenomenon. The
economic and social consequences are extensive and the process will continue to
unfold rapidly, especially in the more advanced countries. In 2009 according to
UN data, 22 percent of the population in developed countries was aged 60 or
over. That share is expected to rise to 33 percent in 2050. The elderly cohort now
outnumbers children under 15 and by 2050 there are likely to be two over 60s
for every child.

According to the UN, the number of older persons tripled in the past 60
years and will triple again by 2050. The “oldest old” -- aged 80 and over -- now
account for four percent of global population. They are the most rapidly
growing age group, with women surviving in greater numbers than men. An
interesting anecdote: the American greeting card company Hallmark reported
selling 85,000 birthday cards for centenarians in 2007.

Another recent UN publication dealing with population policies queried
governments as to their primary population concerns. In response, 79 percent of
governments in developed countries considered ageing “a major concern” followed
by HIV/AIDS, low fertility, and “a small or declining number of persons of
working age.” Data by continental area show an enormous contrast regarding the
significance of population ageing, as indicated below:

It is stunning that all of North America is worried about population ageing
as is most of Europe and Latin America. Africa, which only has 15 percent of
global population, also has more countries with a high fertility rate and a low
level of life expectancy. Oceania is sparsely populated.

According to UN data, there were 29 countries or territories that had
20 percent or more of their population aged 60 or over in 2009. Japan headed
the list followed by European countries, although the US Virgin Islands were
also in the group – which could be due to outsiders who chose to retire there. The
top five besides Japan (29.7%) were Italy (26.4%), Germany (25.7%), Sweden
(24.7%), and Bulgaria (24.2%). In 30th place came Canada (19.5%)
while the United States (17.9%) ranked in 42nd place.

Among the 196 countries covered, there was a stark contrast between the
countries above and those that had the lowest share of over 60s in their
populations: Qatar (1.9%), United Arab Emirates (1.9%), Burkina Faso (3.3%),
Sierra Leone (3.5%), and Niger (3.5%). The median age of countries also showed an
extreme variance: Japan’s median age was 44.4 years, almost triple that of
Niger at the bottom of the list with a mere 15 years.

Japan is the undisputed leader in ageing. At 82.3, Japan has the longest
life expectancy – a tribute to good health, hygiene and local cuisine. With a
shrinking population and hyper-ageing, the Japanese delegate at the 2011UN
Commission for Social Development session mentioned in his statement that:
“Japan has recently become a true ‘society of the aged.’ The proportion of the
Japanese population aged 65 and over now exceeds 23 percent.”

The rapidly ageing Japanese population underlies a weak economic
performance over the past two decades. The economy, which for many years seemed
to have done everything right and was the envy of other nations, began to stall
in the 1990s. This was due not only to a questionable combination of economic
and financial policies but also due to a rapidly ageing population, a low birth
rate and a reluctance to admit migrants from other countries to enhance the
domestic labor force. The resulting economic stagnation, which led to “the lost
decade,” as it has come to be called, seems to have extended well into the new

The top three ageing countries – Japan, Italy and Germany – among others
have enacted or promoted measures to deal with the issue. Efforts have focused
on removing incentives to early retirement, allowing older persons to work
longer, increasing the statutory retirement age for both men and women,
encouraging more women to enter the labor force, and efforts to strengthen
pension systems.

Pension obligations are becoming more burdensome as the members of the
baby boom generation reach retirement age. According to the OECD, pensioners in
developed countries can expect to live 20.4 years in retirement. Japan’s public
pension fund, the largest in the world with assets around $1.5 trillion is
scrambling in search of higher returns to prepare for higher outlays – not
unlike private pension funds. Meanwhile a shrinking number of workers face
higher taxes to support public pension schemes.

For Japan, heightened government spending both in response to a long
period of economic weakness and to meet growing pension obligations have resulted
in an expansion of government debt that, in relation to GDP, is currently nearly
twice that of Greece. The key mitigating element is that Japanese people have
one of the highest savings rates in the world and much of those savings are
placed in government securities. Unlike Greece, the vast majority of Japanese
government debt is held domestically, including by the older population who
undoubtedly have started drawing down these savings to maintain well being. Outliving
one’s savings remains a risk everywhere.

On a social level, the elderly in developed countries are already
beginning to experience the same fate as that of unwanted unborn children.
Euthanasia is the elder equivalent of abortion. Both processes terminate life.
One is a victim who never lived to be born and the other an individual who
lived too long.

Even in Catholic Italy there is interest in legalized euthanasia (it
has the second highest proportion of persons over 60 in the world). In 2006, a
famous oncologist, Umberto Veronesi, wrote a short book that became a best-seller
entitled Il Diritto di Morire (“The
Right to Die”). (It has not been translated into English.) In it he argued that
a patient who is seriously ill and on the verge of death forms a strong bond
with his or her doctor that the latter can perceive the will of the patient,
including the futility of advanced therapies and the desire to die with

Unfortunately for the eminent doctor, the “desire to die with dignity” does
not mean waiting for God to call the patient to Himself. Dr. Veronesi is a non-believer
who praises Belgium and the Netherlands, two of the European countries that
have openly permitted euthanasia. In Italy, he may be highly regarded as a
cancer specialist, but the deliberate taking of life is a bit much for most
Italians, imbued with a sense of respect for the elderly and love for life
itself. Germany and Japan, mindful of their role in World War II, are also unlikely
to embrace the euthanasia lobby.

On a more positive note, the United Nations several years ago
designated October 1 as the “International Day of Older Persons” and the
European Union is promoting 2012 as the “European Year of Active Ageing.”
However, in September each year Japan celebrates “Respect for the Aged Day.”
The commemoration is a sign of esteem for and deference to elders and it so
happens that Japan is destined to have many more seniors to be feted well out into
the future.

Vincenzina Santoro is an
international economist. She represents the American Family Association of New
York at the United Nations.


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