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Debate: Does Longevity Put a Strain on the Economy?

Daniel Callahan, Co-Founder and President Emeritus of the Hastings Center

Daniel Callahan: There’s No Good Reason to Long for Much Longer Lives

Jody Holtzman, Senior Vice President, Enterprise Strategy & Innovation, AARP

Jody Holtzman: The Upside of Longevity — Beyond the Status Quo


The question that’s often overlooked in the debate over longevity is not whether we can — but whether we should — radically extend life expectancies. The clear answer is, no.

 

I have spent many of my 85 years thinking about old age, what it means and what we might do about it. There is always something disturbing about the debates I have with enthusiasts for radically extending life expectancy. The topic is typically introduced with three cheers for life extension beyond our present boundaries, followed by exciting — sometimes breathless — talk about all the scientific breakthroughs on the horizon that would get us there. I always try to stir up interest in the question, “But is that a good idea?”

Few seem prepared to even discuss the question of not can we — but should we — extend life as far as possible. The answer seemed to be self-evident answer: No one likes to get old, do they? But I think the question is unavoidable, and the answer is clear: Life extension a glaringly bad idea.

There are there two ways of thinking about significantly extending life expectancy, by which I will mean well over 100: what we as individuals might like, and what might be best for the human community. I have seen several public opinion surveys from different countries showing variable responses to the question of how long individual people would like to live. In Australia, a survey found that 80 would be long enough for most. In Germany, a study found 85 to be the ideal. And in America, two separate surveys found 90 to be the desired age. In none of them was there much desire to live beyond 100.

My own impression of those in my age group, in their mid-80s, is that they are happy to have lived so long and would welcome a few more years — but would not consider death in the near future a great tragedy. Nor would I. I have met a few people who say they would love to live a much longer life, well past 100, but that seems an uncommon desire. And most of them attach the proviso, “as long as I am in good health.”

A second way is to ask the question is: Would it be good for us as a global community if science found a way for all of us to live much longer on average — so much so that it became predictable and routine?

There are good reasons to pause before answering that question. In developed countries, the healthcare cost of steadily rising numbers of the elderly is accompanied by rising costs for their economic welfare, as well. Americans have an average life expectancy of 79. Those who live into their 80s are likely to die slowly, expensively and with disabilities from one or more chronic diseases — cancer, heart disease, diabetes, Alzheimer’s. Even with Social Security, a majority now also go into old age without adequate additional savings or decent pension support. Many will be desperately poor. As our population continues to age, government projections show a growing and serious financial strain on both federal programs for the elderly.

In poor countries, aging societies will be a far worse problem. Those societies are aging much faster than what we’ve seen in developed countries — and they are not prepared for it. For the first time in history, the number of people over 60 in poor countries is greater than those under 5. The majority in those countries do now not have — and may never have — the kind of money spent in rich countries for the high-tech medical care in old age we now routinely get. Few have pension plans at all. They will have to be cared for — sick or well — by their children, who are often poor themselves. The last thing those countries need is for their elderly, already a burden, to live longer lives — although it is reasonable for them to aspire to live as long as those in developed countries do. That can be brought about by improved income and healthcare, with no need for new scientific schemes to get them there.

There are thus no good reasons for human beings to long for much longer lives. The laws of Darwinian evolution, for one thing, have been good for human beings as a species. Those who are old die, replaced by younger generations. That keeps vitality and change alive. We have gained a great deal of evidence in recent years — from chronic diseases — that it is expensive and socially complicated to strive to extend life in the face of the aging nature brings us. We have not learned well enough how to keep our present elderly alive and in good shape, and poor countries will have it far worse.

As human beings, we have many needs to live well. A much longer life is not one of them. What counts is the quality of life, not its length.

 

The opportunities and challenges presented by innovations in studies of the aging process are featured in the fourth episode of the Breakthrough documentary series, “The Age of Aging,” directed by Ron Howard. The six-part series, developed by GE and the National Geographic Channel, airs Sundays at 9pm ET on the NatGeo Channel.

(Top image: Courtesy of Thinkstock)

 

Daniel CallahanDaniel Callahan is co-founder and President Emeritus of the Hastings Center and the author of, “Setting Limits: Medical Goals In An Aging Society.”

 

 

 

 

All views expressed are those of the author.

America not only can afford the growing number of “old people” — it needs them for a thriving economy.

 

There is an often unspoken assumption when policy makers and others speak about the implications of the aging demographics of the country. When you tear away all of the niceties, it comes down to this — “We can’t afford all of these old people.”

The weaknesses of this claim are several because it:

  • make a zero-sum, economic claim supported by non-economic evidence;
  • is historically static in its outlook and accepts social contracts designed for a different age;
  • views the potential of human capital through the lens of ageism and scarcity; and
  • ignores the potential role of innovation.

When pressed to support the claim, people most often point to the long-term financial sustainability challenges facing Social Security and Medicare. But this is apples and oranges. The claim is economic. The evidence is the result of the design parameters of these two benefits programs.

So, what are the economics of our aging demographics? The bottom line is that people over 50 contribute to the economy in a positive, outsize proportion to their share of the population according to the Oxford Economics study of the Longevity Economy. While only 34 percent of the U.S. population in 2013, people over 50 generated $5.1 trillion in consumer spending and accounted for $7.1 trillion — or 42 percent — of U.S. GDP. This supported just under 90 million jobs, or 49 percent of the total, and generated over $1.5 trillion in federal, state and local taxes.

Not only can we “afford” all these “old people,” they are driving the economy! Equally important, the beneficiaries of this economic activity accrue to people of all ages and generations. It’s not just the 50-plus set that is working those 90 million jobs.

The argument about the economic strain of an aging population also has a starting point that is historically static and assumes a continuation of the status quo.

According to the Transamerica Center on Retirement Studies, 65 percent of Baby Boomers plan to work past 65, or do not plan to retire. Eighty-seven percent of them believe they are still continuing to grow in their work. For 83 percent, their job plays an important part of “who I am.” And 79 percent believe there is a lot they still plan to accomplish.

In addition, people 45-64 become entrepreneurs at a rate almost twice that of people 20-34, according to the Kauffman Foundation. And this share of entrepreneurs represented by older people has grown in recent years, from 38 percent in 1996 to just under 50 percent in 2012. Meanwhile, the share of people 20-34 who start businesses has declined from 35 percent in 1996 to just 26 percent in 2012. The potential for additional economic value creation by people over 50 is both unrecognized in current arguments and — more importantly —untapped.

For the first time in human history, we have an abundance of experienced human capital — capable and wanting — and continuing to add value to their communities, companies and the economy. The only thing stopping them from greater contributions is the narrow thinking of a corporate America that views experienced workers as a cost, rather than an asset with skills, wisdom and experience. While some bemoan the long-term challenges facing Social Security, current policies penalize those who can and want to continue working.

This narrow thinking extends to Medicare, as well, where the potential cost savings that can be derived from better health outcomes due to new innovative approaches, products and services is already clear. For example, in one study conducted by Medstar Health with 800 of Medicare’s oldest, frailest — and costliest — beneficiaries, an alternative home visit care delivery model demonstrated a cost savings of 17 percent compared with the current care delivery model. And this is just one, single innovation!

According to Startup Health, the digital health and investment fund, $5 billion in venture capital was invested as of Q3 2014. Of this, roughly 54 percent of the deals and 44 percent of the funding, or $2.2 billion, was invested in companies developing products and services that were either explicitly designed to serve the needs of people over 50 and/or of equal relevance to people over 50. This level of innovation is already showing the potential to improve health outcomes and lower costs, and thus ensure the longevity of Medicare. There’s more to come.

Only in Washington would serving the needs of over 100 million people be called an unaffordable cost and financial burden. In the private sector, serving the needs of over 100 million people is called an opportunity. Depending on which door you walk through — the unaffordable cost and financial burden door versus the opportunity door — you have a very different conversation. It is time for us all to engage the opportunity conversation.

 

The opportunities and challenges presented by innovations in studies of the aging process are featured in the fourth episode of the Breakthrough documentary series, “The Age of Aging,” directed by Ron Howard. The six-part series, developed by GE and the National Geographic Channel, airs Sundays at 9pm ET on the NatGeo Channel.

(Top image: Courtesy of Thinkstock)

 

Holtzman headshotJody Holtzman is Senior Vice President, Enterprise Strategy & Innovation, AARP

 

 

 

 

All views expressed are those of the author.