IThere are two categories of crises. Those that occur when we least expect them and those that are predictable because they arise from cold and implacable statistical trajectories. Demographic ageing belongs to the second category. This global phenomenon constitutes a major social and economic upheaval on which The World wanted to draw attention to this through a series of investigations published on Thursday 12 and Friday 13 September under the title “A world of old people”. The consequences of this unprecedented development in the history of humanity have nevertheless been insufficiently anticipated at this stage.
Between the increase in life expectancy thanks to medical progress and the decline in the birth rate, the proportion of senior citizens is increasing inexorably, increasingly distorting the age pyramid. This good news on an individual level nevertheless threatens to destabilize the social and welfare systems as they were designed in the immediate post-war period.
To take just the example of France, one in five inhabitants is now over 65. In 1970, there were only 13%. In less than half a century, the number of retirees has more than tripled. In 2070, this age category will represent almost a third of the French population. However, mechanically, an older country struggles to maintain a level of growth capable of financing its social model.
Ruthless mechanics
Without a considerable effort on innovation and education, productivity, which allows the creation of wealth, is likely to continue to decline due to an attrition of the working population. At the same time, savings are taking precedence over consumption and investment, while ageing is absorbing a growing share of the country’s resources to the detriment of future investments.
The mechanism is ruthless. Due to the slowdown in growth, tax revenues are increasingly difficult to raise, while expenses are set to increase exponentially. In addition to the increase in the overall amount of pensions, there are health costs that explode with age and the need to take care of dependency in the last years of life. To sum up, fewer and fewer people have to finance more and more expenses. While debt is already a major issue and other expenses (climate transition, defense, etc.) are urgent, budgetary arbitrations will become impossible.
This description sounds like a truism, as it is supported by hundreds of reliable reports and statistical projections. However, the political debate in France on these issues is subject to extreme polarization that is detrimental to reflection and paralyzes political action. Between the questionable method of the latest pension reform and the systematic denial of reality by its opponents, there must be room for a debate that does not turn into a fistfight.
Faced with the thorny issue of ageing, there are no easy and popular solutions. Raising taxes, lowering pension levels, raising the retirement age, making trade-offs between generations in public policies, using immigration to compensate for the decline in the working population and to finance pensions: to be activated, each of these levers requires realism and a sense of fairness. Two dimensions that the national debate must rediscover.