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Denmark to raise retirement age to 70

telegraph.co.uk

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Re: Denmark to raise retirement age to 70

#641

Post by StillBored »

This is what happens when your population isn't mathematically educated enough to be able to figure out how to plan a defined benefit pension, and there are politicians who are actively trying to destroy a social safety net.

A bit of playing with chatgpt will dump the formulas required and even solve them for a given set of constraints. Basically one takes the average inflation adjusted of an investment vehicle, then solves for what percentage of income for a given timeframe, in order to return a portion of a persons income for another timeframe. Ex: given say the US stock market average return for the past 100 years, one wants to work for 30 years and retire for 30 years with a 70% of the final income, it works out to 8-9% of a persons income. Then shift the numbers to 40/20 years, cap the maximum payout at say the median income, and wow a pension system that grows faster than the rate of inflation, provides for a retirement age of ~60 and the percentage drops to ~5% or less.

People complaining about demographic trends are buying into the idea that the input dollars have to equal the output dollars, and its dumb, and isn't even the way the social security trust fund in the USA works. Which shows that its possible to ride out population bubbles, much less actually providing a long term savings vehicle that if it were run correctly would eventually be indefinitely solvent. But at least in the USA one party has consistently stood in the way for the past 40 years of solving some of these financial problems, and in fact seems to make them worse by flattening the progressive nature of the federal taxes through tax cuts which overwhelmingly target the groups most able to absorb higher tax rates. And the result are cases where single individuals single handily hold 2% of the wealth of their entire generation and the country looks like its falling apart and there is artificial scarcity everywhere.

PS: Now there are a number of ways this breaks, mostly around cases where inflation is eating up most of the compounding growth, but most sovereign governments are fully capable of solving these problems if they choose to.

Re: Denmark to raise retirement age to 70

#642

Post by streptomycin »

vbezhenar wrote: post #299
Ray20 wrote: post #260

Earlier quoted context omitted.

No one knows how to increase the birth rate. And all the studies show that immigration increases the budget deficit, not reduces it (at least in that way in which it is being implemented now).

Everyone knows. Stop contraception, stop woman education, stop abortions, reduce woman rights to 1800. Remove children rights, make environment where children are productive and bring profits to their parents, so they have financial incentive to create children. No one wants to implement it.

Here is a chart of Saudi Arabia's fertility rate, which has dropped from 7 to 2 over the past 40 years: https://www.consultancy-me.com/illustrations/news/detail/202...

Re: Denmark to raise retirement age to 70

#643

Post by Acrobatic_Road »

tzs wrote: post #408
dueltmp_yufsy wrote: post #97

Seems the US will have to do this soon. Just very very unpopular. Not sure which party will actually pull the trigger.

The US may have to raise the retirement age eventually but it could put off needing to do so for a long time by making the payroll tax flat instead of regressive. Currently here is the percent various workers pay: Income Tax $10k 6.2% $50k 6.2% $100k 6.2% $150k 6.2% $200k 5.4% $300k 3.6% $700k 1.6% $1000k 1.1% $5000k 0.22% $10000k 0.11% This comes about because it is structured as a two bracket tax rate: Bracket Marg…

The numbers only work if you assume the program exists in a total vacuum. You can expect Congress will borrow any social security surplus as they start running short in other places, like Medicare.

Re: Denmark to raise retirement age to 70

#644

Post by taneq »

tomp wrote: post #478
toomuchtodo wrote: post #456

Earlier quoted context omitted.

Turns out retirement is just an illusion to convince you to give your best years for the system.

You're just repeating anarchists' talking points. None of them considers that "the system" gives them food, water and energy, and that procurement of these in the absence of system means literally toiling from birth until death.

This is the my response too. There are plenty of valid criticisms of our modern society, but nothing’s stopping you wandering off into the forest to forage for berries. We don’t, because even with all its flaws, living in civilisation is infinitely easier.

Re: Denmark to raise retirement age to 70

#645

Post by insane_dreamer »

Technology is supposed to have made us more productive than ever.

And yet, most people are having to work longer than ever. Why? Because all the productivity gains are being captured by the top ~10%.

And now we're continuing to pour billions into AI that is going to boost our productivity even more! Hurrah! Progress!!

Who do you think is going to capture those gains?

We can argues over some of the details, but there's no question that Piketty is being proven right.[0]

[0] https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Ce...

Re: Denmark to raise retirement age to 70

#646

Post by insane_dreamer »

matsemann wrote: post #139
jampekka wrote: post #119

It's utterly insane that people need to work more and longer as technology increases productivity. A truly dystopian economic system. In 1930 Keynes projected that by 2000 their grandchildren could work 15 hours per week¹. Now the projection is that we will work more and longer in the future. And what is this labor supposed to even do? How much of even current work really increases wellbeing? Graeber's thesis of bull…

Yes, that's what strikes me as well. Where is the productivity gains going? Why are we still working 40 hour weeks, and possibly even for many more years? If I remember correctly, Denmark even removed a holiday recently. So work more days a year as well. That's the problem here. That a few people reap all the benefits of this, while the rest of us toil.

> Where is the productivity gains going?

Those who own the capital. The top 10%-1%. [0]

[0] https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Ce...

Re: Denmark to raise retirement age to 70

#647

Post by insane_dreamer »

tmnvix wrote: post #315
soerxpso wrote: post #196

Earlier quoted context omitted.

> In 1930 Keynes projected that by 2000 their grandchildren could work 15 hours per week This projection came true. You can live with a 1930s living standard while working 15 hours per week at a median wage. However, nobody wants to live at a 1930s living standard. It turns out that in aggregate people prefer to spend productivity gains on conveniences and higher standards of living than on working fewer hours.

> This projection came true. You can live with a 1930s living standard while working 15 hours per week at a median wage. Maybe not if you want to own a home. Asset price inflation is real. If you already own a home, sure.

Keynes did not say that the living standard would remain static.

Re: Denmark to raise retirement age to 70

#648

Post by wsatb »

jltsiren wrote: post #583
amag wrote: post #409

This is truly sad. As a Swede I fear my country may follow suite. The retirement age in Sweden used to be 65 and now it's 67. Looking at older people around me, most lead a much less active life after 75. So, if we were lucky we used to have some 10 good years of doing whatever we wanted before old age and age-related diseases start affecting us so much we become limited to a much smaller world. But now we have maybe…

There is nothing sad about this. Mandatory pensions are not a vacation sponsored by the government but a way to provide for those who can't provide for themselves. If you were born in the 70s, you should have known for most of your adult life that your normal retirement age is likely going to be around 70. The demographic situation is not new, the solutions have been discussed extensively since at least the 90s, and…

You said there’s nothing sad about it and then followed it up with some pretty sad realities. It’s incredibly sad. People should be working less as we advance as a society, not more.

Re: Denmark to raise retirement age to 70

#649

Post by idiotsecant »

nradov wrote: post #430
idiotsecant wrote: post #404

Earlier quoted context omitted.

Yes ,what has to give is a tiny fraction of the corporate and individual wealth hoarded by the richest and most powerful members of society.

How tiny of a fraction? Can you quantify this for us? In principle I think some kind of wealth tax on fortunes above a certain level would be a good idea. But there are a lot of practical implementation problems in terms of identifying and valuing illiquid assets. Like for example I have friends who own forestry land (for softwood timber harvesting) in a foreign country. Those assets have some value but trade infrequ…

It's taxation, not brain surgery. If political will is present we can figure out the accounting. The central question is whether we want to drive the economic output of nearly the entire economy into the hands of the 50 richest people in the world, or if we feel that split should be more equitable.

Re: Denmark to raise retirement age to 70

#650

Post by freddie_mercury »

maratc wrote: post #517
Retric wrote: post #464

Earlier quoted context omitted.

I’d rather a robust pension starting at 70 than an anemic one starting at 55 or an underfunded one starting at 65. You can fill a gap before that pension starts with part time work etc. It’s much harder to make up a shortfall when you’re 85.

But for an individual that would die at 71, which pension would they rather have, in your opinion?

The one where they get to stop working at age 40 and enjoy 31 years of retirement?

Not sure why their opinion matters.

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