NOTwill our children finance our pensions if they hold us responsible for the degradation of the climate? Will retiring in 2050 even be possible under viable conditions, if we fail to deliver on the promise of the Paris Agreement, to achieve “net zero carbon” by that time?
The pension reform is an opportunity to rethink the “generational pact” undermined by the climate crisis. Everything happens, however, as if the debates forgot the essential, namely the very possibility of a peaceful retirement. Indeed, the economic models that underlie the financial balances of the system ignore the climate variable, as if the future world would be the same as today. Nothing is less sure.
In the French pay-as-you-go system, pensions for retirees are financed by contributions from active workers. To set the “right” level of intergenerational solidarity, the models offer the possibility of adjusting the duration or amount of contributions, or the level of pensions. French pensions already represent some 14% of gross domestic product (GDP), a record. This weight weighs on the cost of labor, competitiveness, etc. and would increase due to demographic ageing, hence the reform.
Let’s project ourselves in 2050, far from the current optimizations. History will perhaps remember that the current generation is the one that has best negotiated its share of national wealth, taking full advantage of the growth of the last fifty years, to afford the longest, most happy, without having to pay the bill for the climatic consequences… And yet, they knew…
Decoupling emissions growth
Are the Prime Minister, Elisabeth Borne, and the social partners only looking at the right equation? Seen from 2050, social movements could look like gestures biased by the myopia of models. They are counting on an average growth of 1.4% per year, according to the Pensions Orientation Council (COR), raised to 1.8% by the government for the decades to come. What are the consequences of this growth for the climate and for our pensions?
The engineer and consultant Jean-Marc Jancovici and his “school”, gathered within the Shift Project, rightly question the limits of growth, since it implies a deleterious increase in emissions. For the think tank, saving the climate means reducing growth. Along these lines, forcing workers to extend their careers would be a “quasi-climate crime”, by delaying the switch to a more sober life… On the contrary, activity should be reduced more quickly, to consume less energy and limit the climate deregulation…
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