[Applause] well good afternoon everyone I’m an
well good afternoon everyone I’m an
well good afternoon everyone I’m an economics professor here at johns
economics professor here at johns
economics professor here at johns hopkins and as such i wanted to talk to
hopkins and as such i wanted to talk to
hopkins and as such i wanted to talk to you about what is probably the single
you about what is probably the single
you about what is probably the single largest most serious economic challenge
largest most serious economic challenge
largest most serious economic challenge probably of our time and certainly for
probably of our time and certainly for
probably of our time and certainly for your generation and that is the aging of
your generation and that is the aging of
your generation and that is the aging of our population over the next few minutes
our population over the next few minutes
our population over the next few minutes I want to talk to you about I can figure
I want to talk to you about I can figure
I want to talk to you about I can figure how to get my clicker to work over the
how to get my clicker to work over the
how to get my clicker to work over the next few minutes I want to talk to you
next few minutes I want to talk to you
next few minutes I want to talk to you about how America as a society is
about how America as a society is
about how America as a society is getting older about how that aging if we
getting older about how that aging if we
getting older about how that aging if we continue on our present course is bad
continue on our present course is bad
continue on our present course is bad for retirement security harmful for the
for retirement security harmful for the
for retirement security harmful for the federal budget and fiscal policy and
federal budget and fiscal policy and
federal budget and fiscal policy and ultimately slows economic growth and
ultimately slows economic growth and
ultimately slows economic growth and then so this isn’t all about the dismal
then so this isn’t all about the dismal
then so this isn’t all about the dismal science I want to give you an optimistic
science I want to give you an optimistic
science I want to give you an optimistic note of how instead of aging as we are
note of how instead of aging as we are
note of how instead of aging as we are today we can age gracefully and instead
today we can age gracefully and instead
today we can age gracefully and instead of economic decline age for gracing
of economic decline age for gracing
of economic decline age for gracing graceful aging can lead to actually more
graceful aging can lead to actually more
graceful aging can lead to actually more vibrant economic growth more vibrant
vibrant economic growth more vibrant
vibrant economic growth more vibrant retirement security in the future so
retirement security in the future so
retirement security in the future so first of all it’s abundantly clear we
first of all it’s abundantly clear we
first of all it’s abundantly clear we know the demographics America is getting
know the demographics America is getting
know the demographics America is getting older looking just back to nineteen
older looking just back to nineteen
older looking just back to nineteen eighty there was just over 20 million
eighty there was just over 20 million
eighty there was just over 20 million people above the age of 65 in the United
people above the age of 65 in the United
people above the age of 65 in the United States now there was only 20 million
States now there was only 20 million
States now there was only 20 million senior citizens of the United States
senior citizens of the United States
senior citizens of the United States today it’s more like 50 million and as
today it’s more like 50 million and as
today it’s more like 50 million and as we project forward we’re headed towards
we project forward we’re headed towards
we project forward we’re headed towards 100 million and not only are the number
100 million and not only are the number
100 million and not only are the number of seniors growing but their age is
of seniors growing but their age is
of seniors growing but their age is rising as well if you just look at the
rising as well if you just look at the
rising as well if you just look at the chart behind me you’ll see the number of
chart behind me you’ll see the number of
chart behind me you’ll see the number of folks that are above age 75 above age 85
folks that are above age 75 above age 85
folks that are above age 75 above age 85 even above age 95 is increasing as a
even above age 95 is increasing as a
even above age 95 is increasing as a share of the elderly population now
share of the elderly population now
share of the elderly population now there are a few things driving this one
there are a few things driving this one
there are a few things driving this one is we’re living longer how many folks
is we’re living longer how many folks
is we’re living longer how many folks know what the life expectancy was when
know what the life expectancy was when
know what the life expectancy was when the Social Security Act was passed in
the Social Security Act was passed in
the Social Security Act was passed in 1935 it was aged 65 it was actually a
1935 it was aged 65 it was actually a
1935 it was aged 65 it was actually a normal retirement age at the time if we
normal retirement age at the time if we
normal retirement age at the time if we go back to 1900 over a hundred years ago
go back to 1900 over a hundred years ago
go back to 1900 over a hundred years ago the average life expectancy was only
the average life expectancy was only
the average life expectancy was only around 50 the average life expectancy
around 50 the average life expectancy
around 50 the average life expectancy for those that reach 65 and that wasn’t
for those that reach 65 and that wasn’t
for those that reach 65 and that wasn’t all that comment was only about 77 years
all that comment was only about 77 years
all that comment was only about 77 years old today the average life expectancy is
old today the average life expectancy is
old today the average life expectancy is is 80 and if you’re lucky enough to live
is 80 and if you’re lucky enough to live
is 80 and if you’re lucky enough to live to 65 the
to 65 the
to 65 the life expectancy is 85 people are
life expectancy is 85 people are
life expectancy is 85 people are spending 20 plus years in retirement and
spending 20 plus years in retirement and
spending 20 plus years in retirement and every year and this is a good thing by
every year and this is a good thing by
every year and this is a good thing by the way every year that life expectancy
the way every year that life expectancy
the way every year that life expectancy is growing every year we’re living
is growing every year we’re living
is growing every year we’re living longer every generation is living longer
longer every generation is living longer
longer every generation is living longer than the one before it but by the way as
than the one before it but by the way as
than the one before it but by the way as we’re living longer we’re not working
we’re living longer we’re not working
we’re living longer we’re not working longer in fact is as we look over time
longer in fact is as we look over time
longer in fact is as we look over time we see that we’re living longer and
we see that we’re living longer and
we see that we’re living longer and longer and we’re retiring earlier and
longer and we’re retiring earlier and
longer and we’re retiring earlier and earlier the most common age people
earlier the most common age people
earlier the most common age people retire is now aged 62 the most common to
retire is now aged 62 the most common to
retire is now aged 62 the most common to just 62 that’s the first time you can
just 62 that’s the first time you can
just 62 that’s the first time you can collect Social Security now some folks
collect Social Security now some folks
collect Social Security now some folks retire at 65 when you can collect
retire at 65 when you can collect
retire at 65 when you can collect Medicare some folks retired 66 or 67
Medicare some folks retired 66 or 67
Medicare some folks retired 66 or 67 Social Security’s normal age but on
Social Security’s normal age but on
Social Security’s normal age but on average people are retiring at 63 63 is
average people are retiring at 63 63 is
average people are retiring at 63 63 is the average retirement age that’s way
the average retirement age that’s way
the average retirement age that’s way down from even 30 40 50 years ago as
down from even 30 40 50 years ago as
down from even 30 40 50 years ago as we’re living longer we’re retiring
we’re living longer we’re retiring
we’re living longer we’re retiring earlier and here’s the kicker not only
earlier and here’s the kicker not only
earlier and here’s the kicker not only are we living longer and not working
are we living longer and not working
are we living longer and not working longer but our fertility is weighed out
longer but our fertility is weighed out
longer but our fertility is weighed out so previously yes we were living longer
so previously yes we were living longer
so previously yes we were living longer but we were always having more kids more
but we were always having more kids more
but we were always having more kids more workers to replace the old the older
workers to replace the old the older
workers to replace the old the older ones we’re always having more people
ones we’re always having more people
ones we’re always having more people coming after the generation in order to
coming after the generation in order to
coming after the generation in order to fund our economic growth in order to
fund our economic growth in order to
fund our economic growth in order to fund our senior citizens historically
fund our senior citizens historically
fund our senior citizens historically the United States in the United States
the United States in the United States
the United States in the United States couples have had about three kids per
couples have had about three kids per
couples have had about three kids per couple writer there’s been about three
couple writer there’s been about three
couple writer there’s been about three kids born for every woman that’s above
kids born for every woman that’s above
kids born for every woman that’s above replacement that’s it that’s a level of
replacement that’s it that’s a level of
replacement that’s it that’s a level of fertility that allows for economic
fertility that allows for economic
fertility that allows for economic growth and that allows for population
growth and that allows for population
growth and that allows for population growth briefly after World War two we
growth briefly after World War two we
growth briefly after World War two we had a baby boom the baby boom population
had a baby boom the baby boom population
had a baby boom the baby boom population and we were having about four kids for
and we were having about four kids for
and we were having about four kids for every couple but since then things
every couple but since then things
every couple but since then things crashed right and basically since the
crashed right and basically since the
crashed right and basically since the baby boom population came into this
baby boom population came into this
baby boom population came into this world that fertility rainy night States
world that fertility rainy night States
world that fertility rainy night States has averaged right around replacement
has averaged right around replacement
has averaged right around replacement level which is two people for every
level which is two people for every
level which is two people for every couple that means for every one person
couple that means for every one person
couple that means for every one person they’re going to have one kit that’s
they’re going to have one kit that’s
they’re going to have one kit that’s enough to keep our population stable but
enough to keep our population stable but
enough to keep our population stable but it’s not enough to keep it growing
it’s not enough to keep it growing
it’s not enough to keep it growing growing population of workers to pay for
growing population of workers to pay for
growing population of workers to pay for our seniors add all this together and we
our seniors add all this together and we
our seniors add all this together and we have a situation where our dependency
have a situation where our dependency
have a situation where our dependency ratio or our senior dependency ratio is
ratio or our senior dependency ratio is
ratio or our senior dependency ratio is declining over time just looking at the
declining over time just looking at the
declining over time just looking at the Social Security system back in nineteen
Social Security system back in nineteen
Social Security system back in nineteen fifty we used to have 16 workers paying
fifty we used to have 16 workers paying
fifty we used to have 16 workers paying in
in
in for every retiree pulling out for every
for every retiree pulling out for every
for every retiree pulling out for every retiree receiving benefits but fast
retiree receiving benefits but fast
retiree receiving benefits but fast forwarding to 1960 when the program is
forwarding to 1960 when the program is
forwarding to 1960 when the program is more mature we’d five workers paying in
more mature we’d five workers paying in
more mature we’d five workers paying in for everyone retiree receiving benefits
for everyone retiree receiving benefits
for everyone retiree receiving benefits that meant that each of us in this room
that meant that each of us in this room
that meant that each of us in this room would have to pay twenty cents in order
would have to pay twenty cents in order
would have to pay twenty cents in order to give one dollar to a senior that’s
to give one dollar to a senior that’s
to give one dollar to a senior that’s not so bad twenty cents out of your
not so bad twenty cents out of your
not so bad twenty cents out of your income for a dollar of senior income
income for a dollar of senior income
income for a dollar of senior income today there’s only three workers for
today there’s only three workers for
today there’s only three workers for every retiree which means that each of
every retiree which means that each of
every retiree which means that each of us has to contribute thirty-three cents
us has to contribute thirty-three cents
us has to contribute thirty-three cents for every dollar a senior receives and
for every dollar a senior receives and
for every dollar a senior receives and over time by 2035 there’s only going to
over time by 2035 there’s only going to
over time by 2035 there’s only going to be two of us paying for every senior in
be two of us paying for every senior in
be two of us paying for every senior in other words two people have to split the
other words two people have to split the
other words two people have to split the cost of the senior that’s fifty cents
cost of the senior that’s fifty cents
cost of the senior that’s fifty cents each of us have to contribute just for a
each of us have to contribute just for a
each of us have to contribute just for a dollar of senior income this declining
dollar of senior income this declining
dollar of senior income this declining ratio of workers to retirees is
ratio of workers to retirees is
ratio of workers to retirees is problematic for a lot of reasons and it
problematic for a lot of reasons and it
problematic for a lot of reasons and it brings me to my next point which is
brings me to my next point which is
brings me to my next point which is aging is bad for economic growth aging
aging is bad for economic growth aging
aging is bad for economic growth aging is bad for society we need to do
is bad for society we need to do
is bad for society we need to do something about it first of all our
something about it first of all our
something about it first of all our population aging not death panels but as
population aging not death panels but as
population aging not death panels but as there are other options we’ll talk about
there are other options we’ll talk about
there are other options we’ll talk about first of all population aging is
first of all population aging is
first of all population aging is problematic for retirement security if
problematic for retirement security if
problematic for retirement security if people are living longer but they aren’t
people are living longer but they aren’t
people are living longer but they aren’t working longer it means they have less
working longer it means they have less
working longer it means they have less savings available to finance their
savings available to finance their
savings available to finance their retirement your choices then are you
retirement your choices then are you
retirement your choices then are you need to either consume less during your
need to either consume less during your
need to either consume less during your working life and then save more or you
working life and then save more or you
working life and then save more or you need to stretch the same amount of
need to stretch the same amount of
need to stretch the same amount of savings over more years it’s a lot
savings over more years it’s a lot
savings over more years it’s a lot harder to retire for thirty years than
harder to retire for thirty years than
harder to retire for thirty years than 415 you need a lot more savings to do it
415 you need a lot more savings to do it
415 you need a lot more savings to do it secondly our aging population is
secondly our aging population is
secondly our aging population is seriously problematic for our national
seriously problematic for our national
seriously problematic for our national debt so today in our new president
debt so today in our new president
debt so today in our new president entered office with a higher debt
entered office with a higher debt
entered office with a higher debt relative to the economy than any
relative to the economy than any
relative to the economy than any president besides Harry Truman right now
president besides Harry Truman right now
president besides Harry Truman right now dead is seventy-seven percent of GDP
dead is seventy-seven percent of GDP
dead is seventy-seven percent of GDP which is a record other than during
which is a record other than during
which is a record other than during World War two overtime its projected to
World War two overtime its projected to
World War two overtime its projected to double by 2050 even under current law we
double by 2050 even under current law we
double by 2050 even under current law we expect it to double as a share of GDP
expect it to double as a share of GDP
expect it to double as a share of GDP this is more than entirely driven by the
this is more than entirely driven by the
this is more than entirely driven by the aging of our population it’s more than
aging of our population it’s more than
aging of our population it’s more than entirely driven by the rising cost of
entirely driven by the rising cost of
entirely driven by the rising cost of Social Security which is our senior
Social Security which is our senior
Social Security which is our senior retirement program and Medicare which is
retirement program and Medicare which is
retirement program and Medicare which is our senior health program in fact if
our senior health program in fact if
our senior health program in fact if those two programs just grew at the pace
those two programs just grew at the pace
those two programs just grew at the pace of economic growth we would have the
of economic growth we would have the
of economic growth we would have the declining debt ratio fiscal policy the
declining debt ratio fiscal policy the
declining debt ratio fiscal policy the united states would be stable and this
united states would be stable and this
united states would be stable and this isn’t just
isn’t just
isn’t just a problem for the debt it’s a problem
a problem for the debt it’s a problem
a problem for the debt it’s a problem for these specific programs social
for these specific programs social
for these specific programs social security in particular is self financed
security in particular is self financed
security in particular is self financed people pay your payroll tax into Social
people pay your payroll tax into Social
people pay your payroll tax into Social Security and then other seniors receive
Security and then other seniors receive
Security and then other seniors receive benefits from that trust fund in the
benefits from that trust fund in the
benefits from that trust fund in the past especially in the 90s we had more
past especially in the 90s we had more
past especially in the 90s we had more paying in than we had pulling out we had
paying in than we had pulling out we had
paying in than we had pulling out we had the baby boomers in their prime working
the baby boomers in their prime working
the baby boomers in their prime working years contributing payroll taxes and a
years contributing payroll taxes and a
years contributing payroll taxes and a relatively small senior population so we
relatively small senior population so we
relatively small senior population so we built up a surplus built of a trust fund
built up a surplus built of a trust fund
built up a surplus built of a trust fund about three trillion dollars now every
about three trillion dollars now every
about three trillion dollars now every year we’re drawing from that trust fund
year we’re drawing from that trust fund
year we’re drawing from that trust fund by sometime between 2030 and 2035 that
by sometime between 2030 and 2035 that
by sometime between 2030 and 2035 that trust fund is going to be empty there’ll
trust fund is going to be empty there’ll
trust fund is going to be empty there’ll be no money left in it at that point the
be no money left in it at that point the
be no money left in it at that point the law says every one of the program
law says every one of the program
law says every one of the program doesn’t matter if you’re rich or your
doesn’t matter if you’re rich or your
doesn’t matter if you’re rich or your poor doesn’t matter if your age 62 or 92
poor doesn’t matter if your age 62 or 92
poor doesn’t matter if your age 62 or 92 everyone in the program sees their
everyone in the program sees their
everyone in the program sees their benefits cut immediately by twenty
benefits cut immediately by twenty
benefits cut immediately by twenty percent now we can prevent that but to
percent now we can prevent that but to
percent now we can prevent that but to prevent that we basically need to make
prevent that we basically need to make
prevent that we basically need to make adjustments equivalent to over 11
adjustments equivalent to over 11
adjustments equivalent to over 11 trillion dollars in today’s dollars
trillion dollars in today’s dollars
trillion dollars in today’s dollars that’s our unfunded obligations all of
that’s our unfunded obligations all of
that’s our unfunded obligations all of this to address the effect of the aging
this to address the effect of the aging
this to address the effect of the aging population on the Social Security system
population on the Social Security system
population on the Social Security system and perhaps most importantly as we age
and perhaps most importantly as we age
and perhaps most importantly as we age we’re experiencing a permanent slowdown
we’re experiencing a permanent slowdown
we’re experiencing a permanent slowdown in economic growth historically there
in economic growth historically there
in economic growth historically there have always been booms and busts but the
have always been booms and busts but the
have always been booms and busts but the United States on average has grown about
United States on average has grown about
United States on average has grown about 3% from year to year half of that was
3% from year to year half of that was
3% from year to year half of that was labor force growth 1.5 of that three
labor force growth 1.5 of that three
labor force growth 1.5 of that three percent was the fact that each year more
percent was the fact that each year more
percent was the fact that each year more people were entering the labor force or
people were entering the labor force or
people were entering the labor force or working more hours now we’re only
working more hours now we’re only
working more hours now we’re only projected to see that labor force growth
projected to see that labor force growth
projected to see that labor force growth at half a percent a year so instead of
at half a percent a year so instead of
at half a percent a year so instead of one and a half percentage points growth
one and a half percentage points growth
one and a half percentage points growth from labor force we’re getting half a
from labor force we’re getting half a
from labor force we’re getting half a percent and that means our economic
percent and that means our economic
percent and that means our economic growth is going to slow and in fact
growth is going to slow and in fact
growth is going to slow and in fact already has slowed from three percent
already has slowed from three percent
already has slowed from three percent year to year to two percent now that
year to year to two percent now that
year to year to two percent now that might seem like a small difference but
might seem like a small difference but
might seem like a small difference but over time it accumulates and it’s quite
over time it accumulates and it’s quite
over time it accumulates and it’s quite significant it could be the difference
significant it could be the difference
significant it could be the difference between a prospering society and one
between a prospering society and one
between a prospering society and one that’s just holding on luckily it’s not
that’s just holding on luckily it’s not
that’s just holding on luckily it’s not all bad news just because demographics
all bad news just because demographics
all bad news just because demographics is destiny we can’t stop aging but what
is destiny we can’t stop aging but what
is destiny we can’t stop aging but what we can do is address it what we can do
we can do is address it what we can do
we can do is address it what we can do is learn to age gracefully and I would
is learn to age gracefully and I would
is learn to age gracefully and I would propose a three-part plan that will get
propose a three-part plan that will get
propose a three-part plan that will get us most of the way there part one is we
us most of the way there part one is we
us most of the way there part one is we need to reform our immigration laws part
need to reform our immigration laws part
need to reform our immigration laws part two we need to fix of Social Security
two we need to fix of Social Security
two we need to fix of Social Security and part 3 perhaps most importantly we
and part 3 perhaps most importantly we
and part 3 perhaps most importantly we need to change the way we think about
need to change the way we think about
need to change the way we think about retirement we need to change our
retirement we need to change our
retirement we need to change our retirement culture so let me go through
retirement culture so let me go through
retirement culture so let me go through these in order very quickly first of all
these in order very quickly first of all
these in order very quickly first of all if your problem is you have too few
if your problem is you have too few
if your problem is you have too few workers for retirees part of the
workers for retirees part of the
workers for retirees part of the solution should be to try to have more
solution should be to try to have more
solution should be to try to have more workers per retiree we could do that the
workers per retiree we could do that the
workers per retiree we could do that the old-fashioned way but that requires a
old-fashioned way but that requires a
old-fashioned way but that requires a big boost in fertility and then to wait
big boost in fertility and then to wait
big boost in fertility and then to wait 18 to 30 years before we actually get
18 to 30 years before we actually get
18 to 30 years before we actually get the labor participation right a much
the labor participation right a much
the labor participation right a much quicker fix for this is to increase the
quicker fix for this is to increase the
quicker fix for this is to increase the number of especially young and
number of especially young and
number of especially young and especially skilled immigrants coming
especially skilled immigrants coming
especially skilled immigrants coming into this country but to increase the
into this country but to increase the
into this country but to increase the total number of immigrants this will
total number of immigrants this will
total number of immigrants this will boost economic growth this will secure
boost economic growth this will secure
boost economic growth this will secure or this will strengthen our trust funds
or this will strengthen our trust funds
or this will strengthen our trust funds this will improve the debt situation and
this will improve the debt situation and
this will improve the debt situation and this will help to rebalance our
this will help to rebalance our
this will help to rebalance our demographic situation in the immediate
demographic situation in the immediate
demographic situation in the immediate term now I want to be careful this is
term now I want to be careful this is
term now I want to be careful this is not a permanent solution because
not a permanent solution because
not a permanent solution because remember if we bring young workers in
remember if we bring young workers in
remember if we bring young workers in eventually they too were going to be old
eventually they too were going to be old
eventually they too were going to be old eventually they too will be on the wrong
eventually they too will be on the wrong
eventually they too will be on the wrong side of the dependency ratio but what
side of the dependency ratio but what
side of the dependency ratio but what immigration reform can do is buy us time
immigration reform can do is buy us time
immigration reform can do is buy us time is buy us a more gradual transition to
is buy us a more gradual transition to
is buy us a more gradual transition to the young population we used to have to
the young population we used to have to
the young population we used to have to the older population we’re already
the older population we’re already
the older population we’re already starting to have so immigration is step
starting to have so immigration is step
starting to have so immigration is step one but step two is we should be
one but step two is we should be
one but step two is we should be treating basically the biggest symptom
treating basically the biggest symptom
treating basically the biggest symptom of our aging population which is the
of our aging population which is the
of our aging population which is the decline and ultimate insolvency of our
decline and ultimate insolvency of our
decline and ultimate insolvency of our social security system the thing is
social security system the thing is
social security system the thing is fixing Social Security is actually
fixing Social Security is actually
fixing Social Security is actually incredibly easy if instead of speaking
incredibly easy if instead of speaking
incredibly easy if instead of speaking about aging I just negotiated with all
about aging I just negotiated with all
about aging I just negotiated with all of you a social security reform plan in
of you a social security reform plan in
of you a social security reform plan in my 18 minutes we’d have about 14 minutes
my 18 minutes we’d have about 14 minutes
my 18 minutes we’d have about 14 minutes left to spare okay you go to Social
left to spare okay you go to Social
left to spare okay you go to Social Security reform org you can design a
Security reform org you can design a
Security reform org you can design a Social Security reform plan there’s only
Social Security reform plan there’s only
Social Security reform plan there’s only a few lovers we can boost the social
a few lovers we can boost the social
a few lovers we can boost the social security retirement age we can slow the
security retirement age we can slow the
security retirement age we can slow the benefit growth maybe just for higher
benefit growth maybe just for higher
benefit growth maybe just for higher earners who don’t need it as much we can
earners who don’t need it as much we can
earners who don’t need it as much we can increase the amount of income coming
increase the amount of income coming
increase the amount of income coming into the program maybe by increasing
into the program maybe by increasing
into the program maybe by increasing income subject to the social security
income subject to the social security
income subject to the social security payroll tax cap the solutions are pretty
payroll tax cap the solutions are pretty
payroll tax cap the solutions are pretty straightforward the politics are really
straightforward the politics are really
straightforward the politics are really hard but I promised if our politicians
hard but I promised if our politicians
hard but I promised if our politicians come together and agree on some
come together and agree on some
come together and agree on some compromise a I think they’re gonna get
compromise a I think they’re gonna get
compromise a I think they’re gonna get more thumbs up the middle fingers as my
more thumbs up the middle fingers as my
more thumbs up the middle fingers as my old boss L Simpson used to say but be
old boss L Simpson used to say but be
old boss L Simpson used to say but be the economic benefits will be huge no
the economic benefits will be huge no
the economic benefits will be huge no longer will we have an
longer will we have an
longer will we have an solvent social security system no longer
solvent social security system no longer
solvent social security system no longer will we have a rapidly rising debt and
will we have a rapidly rising debt and
will we have a rapidly rising debt and on top of all of that workers will have
on top of all of that workers will have
on top of all of that workers will have clear signals about how much to work how
clear signals about how much to work how
clear signals about how much to work how much to save and invest and how to plan
much to save and invest and how to plan
much to save and invest and how to plan for their future right now they have
for their future right now they have
for their future right now they have none of that that brings me by last
none of that that brings me by last
none of that that brings me by last point which is we need to start
point which is we need to start
point which is we need to start rethinking retirement the old way of
rethinking retirement the old way of
rethinking retirement the old way of retiring was got a job at age 20 or so
retiring was got a job at age 20 or so
retiring was got a job at age 20 or so you worked until age 63 or so and then
you worked until age 63 or so and then
you worked until age 63 or so and then you retired into something completely
you retired into something completely
you retired into something completely different you know you moved to Florida
different you know you moved to Florida
different you know you moved to Florida or you moved into a smaller home that
or you moved into a smaller home that
or you moved into a smaller home that doesn’t work anymore that’s that’s that
doesn’t work anymore that’s that’s that
doesn’t work anymore that’s that’s that makes sense in a manufacturing economy
makes sense in a manufacturing economy
makes sense in a manufacturing economy that’s not very dynamic it doesn’t make
that’s not very dynamic it doesn’t make
that’s not very dynamic it doesn’t make sense in our modern economy that’s
sense in our modern economy that’s
sense in our modern economy that’s increasingly both service and
increasingly both service and
increasingly both service and information based doesn’t work in our
information based doesn’t work in our
information based doesn’t work in our uber economy where you can have ten jobs
uber economy where you can have ten jobs
uber economy where you can have ten jobs or one job it doesn’t work in an economy
or one job it doesn’t work in an economy
or one job it doesn’t work in an economy where people can move fluidly from job
where people can move fluidly from job
where people can move fluidly from job to job and don’t even have to be in the
to job and don’t even have to be in the
to job and don’t even have to be in the same physical location we need to
same physical location we need to
same physical location we need to rethink retirement yeah some people
rethink retirement yeah some people
rethink retirement yeah some people should still retire at age 62 or 63
should still retire at age 62 or 63
should still retire at age 62 or 63 maybe earlier others could stay at their
maybe earlier others could stay at their
maybe earlier others could stay at their exact same job until age 70 or 75 or 80
exact same job until age 70 or 75 or 80
exact same job until age 70 or 75 or 80 and if they’re happy doing that we
and if they’re happy doing that we
and if they’re happy doing that we should be encouraging them to but
should be encouraging them to but
should be encouraging them to but there’s a bigger group of people that
there’s a bigger group of people that
there’s a bigger group of people that fall into need these neither category
fall into need these neither category
fall into need these neither category neither do I want to quit exactly at age
neither do I want to quit exactly at age
neither do I want to quit exactly at age 62 nor work until 150 years old right
62 nor work until 150 years old right
62 nor work until 150 years old right there’s other options though you can
there’s other options though you can
there’s other options though you can transition into retirement phased
transition into retirement phased
transition into retirement phased retirement maybe you switch from
retirement maybe you switch from
retirement maybe you switch from full-time to part-time you can move to
full-time to part-time you can move to
full-time to part-time you can move to consulting you can retire then come back
consulting you can retire then come back
consulting you can retire then come back you have an encore career have a
you have an encore career have a
you have an encore career have a consulting career there’s no reason
consulting career there’s no reason
consulting career there’s no reason retired firefighter can’t open a bar or
retired firefighter can’t open a bar or
retired firefighter can’t open a bar or become a bartender there’s no reason
become a bartender there’s no reason
become a bartender there’s no reason that a retired real estate agent can’t
that a retired real estate agent can’t
that a retired real estate agent can’t teach at a community college teach
teach at a community college teach
teach at a community college teach business at a community college there’s
business at a community college there’s
business at a community college there’s no reason that somebody that’s been a
no reason that somebody that’s been a
no reason that somebody that’s been a mechanic for their whole life can’t
mechanic for their whole life can’t
mechanic for their whole life can’t start doing aviation consulting we need
start doing aviation consulting we need
start doing aviation consulting we need to stop thinking of the labor force is
to stop thinking of the labor force is
to stop thinking of the labor force is one fixed job with one fixed choice do I
one fixed job with one fixed choice do I
one fixed job with one fixed choice do I work or do I not work and start thinking
work or do I not work and start thinking
work or do I not work and start thinking about it as a breadth of choice where
about it as a breadth of choice where
about it as a breadth of choice where each individual makes the best decision
each individual makes the best decision
each individual makes the best decision for them and our economy and our
for them and our economy and our
for them and our economy and our economic policy welcomes those decisions
economic policy welcomes those decisions
economic policy welcomes those decisions now if we can do that I suspect one
now if we can do that I suspect one
now if we can do that I suspect one people will work longer and I suspect
people will work longer and I suspect
people will work longer and I suspect they’ll work longer in much more
they’ll work longer in much more
they’ll work longer in much more flexible ways and the benefits of that
flexible ways and the benefits of that
flexible ways and the benefits of that would be huge first of all we see a big
would be huge first of all we see a big
would be huge first of all we see a big uptick in economic growth these are
uptick in economic growth these are
uptick in economic growth these are estimates from the Congressional Budget
estimates from the Congressional Budget
estimates from the Congressional Budget Office this is basically the official
Office this is basically the official
Office this is basically the official scorekeeper of the united states
scorekeeper of the united states
scorekeeper of the united states government and they say if everybody
government and they say if everybody
government and they say if everybody just works one year longer the economy
just works one year longer the economy
just works one year longer the economy will eventually be two and a half
will eventually be two and a half
will eventually be two and a half percent larger if everybody works three
percent larger if everybody works three
percent larger if everybody works three years longer the economy will be seven
years longer the economy will be seven
years longer the economy will be seven percent larger and remember this doesn’t
percent larger and remember this doesn’t
percent larger and remember this doesn’t have to happen all at once this can be a
have to happen all at once this can be a
have to happen all at once this can be a gradual change secondly working longer
gradual change secondly working longer
gradual change secondly working longer is good for workers the longer you work
is good for workers the longer you work
is good for workers the longer you work the fewer years you’ve got to take care
the fewer years you’ve got to take care
the fewer years you’ve got to take care of yourself in foreign retirement and
of yourself in foreign retirement and
of yourself in foreign retirement and the more savings you will have to do so
the more savings you will have to do so
the more savings you will have to do so with again these are some estimates of
with again these are some estimates of
with again these are some estimates of how much money you’d have if you just
how much money you’d have if you just
how much money you’d have if you just put a typical amount into a 401k say
put a typical amount into a 401k say
put a typical amount into a 401k say 5,000 a year depending on your age of
5,000 a year depending on your age of
5,000 a year depending on your age of retirement if you’re tired at 62 you’d
retirement if you’re tired at 62 you’d
retirement if you’re tired at 62 you’d basically be able to spend twenty six
basically be able to spend twenty six
basically be able to spend twenty six thousand dollars a year that would be
thousand dollars a year that would be
thousand dollars a year that would be your income if you just retired at 66
your income if you just retired at 66
your income if you just retired at 66 you’d be able to spend thirty five
you’d be able to spend thirty five
you’d be able to spend thirty five thousand retiring later is good for
thousand retiring later is good for
thousand retiring later is good for workers at least for workers that are
workers at least for workers that are
workers at least for workers that are able and by the way the literature on
able and by the way the literature on
able and by the way the literature on this they’re not Universal all points in
this they’re not Universal all points in
this they’re not Universal all points in one direction which is that working
one direction which is that working
one direction which is that working longer and working in more flexible ways
longer and working in more flexible ways
longer and working in more flexible ways is good for folks wealth it’s good for
is good for folks wealth it’s good for
is good for folks wealth it’s good for their health and it’s good for their
their health and it’s good for their
their health and it’s good for their happiness there’s one study that
happiness there’s one study that
happiness there’s one study that basically says if a worker works a year
basically says if a worker works a year
basically says if a worker works a year more they can spend ten percent more
more they can spend ten percent more
more they can spend ten percent more each year for the remainder of their
each year for the remainder of their
each year for the remainder of their lives that’s a much happier retirement
lives that’s a much happier retirement
lives that’s a much happier retirement right ten percent more they actually
right ten percent more they actually
right ten percent more they actually looked at low income seniors and found
looked at low income seniors and found
looked at low income seniors and found it was more like fifteen percent more it
it was more like fifteen percent more it
it was more like fifteen percent more it also turns out we’re healthier when we
also turns out we’re healthier when we
also turns out we’re healthier when we work longer both mentally and physically
work longer both mentally and physically
work longer both mentally and physically and were happier we’re more satisfied
and were happier we’re more satisfied
and were happier we’re more satisfied when we worked longer humans weren’t
when we worked longer humans weren’t
when we worked longer humans weren’t meant to do the same thing their entire
meant to do the same thing their entire
meant to do the same thing their entire life and then just one day stop right
life and then just one day stop right
life and then just one day stop right humans are dynamic and we live in a
humans are dynamic and we live in a
humans are dynamic and we live in a dynamic society we’re meant to be able
dynamic society we’re meant to be able
dynamic society we’re meant to be able to fulfill our to use our skills to the
to fulfill our to use our skills to the
to fulfill our to use our skills to the best of our ability and to fill our own
best of our ability and to fill our own
best of our ability and to fill our own goals of happiness that doesn’t happen
goals of happiness that doesn’t happen
goals of happiness that doesn’t happen with some binary retirement system this
with some binary retirement system this
with some binary retirement system this is the good news the good news is
is the good news the good news is
is the good news the good news is there’s a win-win here right if we think
there’s a win-win here right if we think
there’s a win-win here right if we think the way we retire if we fix our social
the way we retire if we fix our social
the way we retire if we fix our social security system we increase immigration
security system we increase immigration
security system we increase immigration to manage the transition we don’t have
to manage the transition we don’t have
to manage the transition we don’t have to have economic decline we can age
to have economic decline we can age
to have economic decline we can age gracefully
gracefully
gracefully and we can achieve economic prosperity
and we can achieve economic prosperity
and we can achieve economic prosperity thank you very much
thank you very much
thank you very much [Applause]
”
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