America is a terrible place to retire.
At least that’s what the global asset manager Natixis reports. Apparently we’re in 18th placeth in its latest Global Retirement Index based on “old age security” just ahead of Slovenia, Malta and Estonia. The top positions usually go to Scandinavian or Germanic countries as well as Canada, Australia, New Zealand, Ireland, South Korea and the Czech Republic.
Norway is No. 1.
It’s hard to say how much weight to give to these rankings. Natixis says it calculates the numbers based on “18 key performance indicators.” These range from the most obvious such as life expectancy, uninsured health expenditure and the dependency ratio of old people to workers, to others such as ‘bad bank loans’ and ‘biodiversity and habitat’.
In areas related to “material wealth,” says Natixis, the Czech Republic is the best country in the world, Malta is number 8, and America is so bad it doesn’t even make the top 25.
No disrespect to the fine folks of places like Norway, Iceland and Finland, but I think I’d rather spend my golden years somewhere like the Florida Keys.
Make what you want out of it.
Meanwhile, this report raises some interesting questions.
Wouldn’t it be funny (more weirdly quirky than funny ha-ha) if the world that doesn’t want immigrants started fighting for them instead?
As the study points out, most of the world’s rich countries will face a crisis over the next two decades as they will not have enough young workers to support all older retirees.
Here in America, for example, for every senior over 65, there are only 3.5 people of working age—that is, between the ages of 20 and 64. But by 2050 there will be 2.5 working-age people for every senior. And we’re in a much better position than most other rich countries.
In China, the ratio will drop to 2:1, and in European countries like France and Germany, there will be fewer than 2 people of regular working age for every senior. Amazingly, Japan, Spain and Italy will approach a 1:1 ratio. In Japan, the first country to grapple with this demographic crisis, there will be only about 5 people of working age for every 4 retirees by 2050.
Try to get this working.
Meanwhile, China will have more seniors, about 370 million, than America currently has residents.
As mentioned here, one of the simplest, easiest, least risky, and most rewarding policy options on planet earth is to open your doors to high-skilled immigration.
When you talk about high-skilled immigration, you’re not even talking about problems like unskilled labor that drives down starting wages for the resident population. Biotech graduate students don’t get off the plane and start squeezing other people’s wages. They accelerate growth.
Congress seems completely uninterested in doing such a thing. But then why should it? These lawmakers aren’t the ones who are likely to wreck their retirement plans if Uncle Sam runs out of money.
So why should they care? It’s probably better for their careers to play politics and instead demagogue the issue at their grassroots level.
Another thing that struck me: Why is Norway so outstanding when it comes to pension provision? Here’s one thing that’s sure to help: For decades, they’ve been investing their vast national pension system in global equities, like any regular trustee. Here in America, Congress is inflating our Social Security dollars on murky government bonds. As expected, returns were miserable.
Congress could have changed before this year. You could change it tomorrow.
But again, why bother? As with legal immigration, so with the investment policies of the Social Security Trust Fund, if horrific decisions by Congress throw America into a pension crisis, it probably won’t hurt…the 535 people in the House or Senate.
Apparently, Social Security cuts, like taxes, are only for the little people.
That explains why frozen Scandinavia is even a better place to retire than America’s sunniest shores.
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