Using the US as an example, in 2010 65-year-old US citizens accessed welfare benefits worth US$333 billion more than they paid in taxes, 17 times more than the average 25-year-old had access to in the same year.
Politicians currying favor with voters do not use generational accounting to include intergenerational balances in their equations and, as a result, retirement systems around the world are facing bankruptcy.
If insurance schemes at every level are experiencing deficits, why are premiums not being increased? Every time premium increases are suggested, the Cabinet postpones any adjustments “based on overall concerns,” because “the timing isn’t right” or because “the issue requires a comprehensive review.”
When election concerns are added to the mix, one wonders if anyone ever will dare stir up this hornets’ nest.
Taiwan’s baby boomers will begin retiring in 2016. In 2031, Taiwan’s population may have the oldest average age in the world and within 20 years the government’s four main retirement funds will go bankrupt. It is already too late to deal with this problem and we should all shoulder the blame — regardless of our political affiliation — lest we want to make future generations our enemy.
Today’s Greece could well be tomorrow’s Taiwan.
Jai Ben-ray is director of the Center for General Education at Feng Chia University.
Translated by Perry Svensson