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Ireland V Germany re Pension Burden

Interesting post in the Irish Independent by David Quinn  about pensions.  Although I do not agree with much his sentiments, he is right about the Irish advantage of a large cohort of young people.  Could the German intransigence re debt restructuring be a cunning plan to attract our young people to maintain the aging German Population in the comfort they have come to enjoy?.  Actually unlikely, as most Irish are sensibly emigrating, as the piece suggest to the US, Canada and Australia where there is also a young-ish population.

…But even if we do manage to clean up the mess, and put in place effective safeguards against a repeat performance, there is another economic calamity coming our way in the form of an immense demographic crunch. We need to do much more talking about this.

Thomas Molloy alluded to this problem (Irish Independent, March 22) when he said what EU leaders want “is a solution to Europe’s economic problems so that they can continue the process of restructuring their own economies before their dying populations overwhelm their social welfare and pension systems”. I wish them luck, especially the Germans who basically don’t believe in having children anymore. They may be frugal, but that’s not going to solve the problem of a very rapidly ageing population

Here are some facts. In Ireland, one-in-10 people are over the age of 65. In Germany, the figure is already one in five.In less than 20 years, the German figure will be one in three. Eventually there will be a pensioner for every worker. Germany is simply an outlier in this regard. Even Britain, which has a fairly healthy birth rate — meaning it’s not too far below two children per couple — is going to be in trouble.

A report published last week calculated that a British 65-year-old today has received from the state £223,000 (€265,000) — more than they’ve paid in taxes over their lifetime.

But a baby born today will pay £160,000 (€180,000) more in taxes than they receive.

This means young people in the future are going to be hit with an enormous tax burden to pay for the health and pension needs of older people.

(link to article)

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