1 00:00:04,440 --> 00:00:07,360 Speaker 1: From Bloomberg News and I Heart Radio. It's the big tag. 2 00:00:09,000 --> 00:00:13,200 Speaker 1: I'm west Kosova. Today, governments around the world want to 3 00:00:13,280 --> 00:00:17,840 Speaker 1: raise the retirement age. Citizens are saying, not so fast. 4 00:00:24,560 --> 00:00:28,440 Speaker 1: It's a looming problem almost everywhere. More and more people 5 00:00:28,520 --> 00:00:32,400 Speaker 1: are retiring and living longer, and there aren't enough younger 6 00:00:32,520 --> 00:00:36,200 Speaker 1: working people to pay the retirement benefits of the generation 7 00:00:36,479 --> 00:00:40,199 Speaker 1: that came before them. The standard way for politicians to 8 00:00:40,280 --> 00:00:44,640 Speaker 1: address this coming crisis is to ignore it. But as 9 00:00:44,680 --> 00:00:48,480 Speaker 1: the bills stack up, that's becoming increasingly difficult to do. 10 00:00:48,880 --> 00:00:51,800 Speaker 1: So what's the answer. Two of my colleagues are here 11 00:00:51,840 --> 00:00:56,000 Speaker 1: to sort out the tough economics and tricky politics. Ben 12 00:00:56,120 --> 00:01:01,160 Speaker 1: Sills in Madrid leads Bloomberg's Government and Economics covery across Europe, 13 00:01:01,640 --> 00:01:05,039 Speaker 1: and Nancy Cook is a White House correspondent in Washington. 14 00:01:06,560 --> 00:01:09,280 Speaker 1: Then we're seeing an awful lot of anger from French 15 00:01:09,360 --> 00:01:12,440 Speaker 1: citizens who do not like President mccron's plan to raise 16 00:01:12,480 --> 00:01:14,920 Speaker 1: the retirement age from sixty two to sixty four. Can 17 00:01:14,920 --> 00:01:17,960 Speaker 1: you describe what's going on in Paris? Yeah, the French 18 00:01:18,000 --> 00:01:21,640 Speaker 1: people are furious about this, aren't they. This is kind 19 00:01:21,760 --> 00:01:25,319 Speaker 1: of like the third rail of French politics. It's been 20 00:01:25,360 --> 00:01:29,840 Speaker 1: an issue which successive presidents have promised to tackle, have 21 00:01:30,000 --> 00:01:34,440 Speaker 1: tried to tackle, and time and again we've seen they 22 00:01:34,520 --> 00:01:37,440 Speaker 1: draft a proposals, they submit it to the National Assembly 23 00:01:37,560 --> 00:01:40,639 Speaker 1: and then boom like the people are out in the streets. 24 00:01:40,680 --> 00:01:44,640 Speaker 1: The French people know how to strike and it becomes 25 00:01:44,640 --> 00:01:47,640 Speaker 1: a real test of the nerve and the resolve of 26 00:01:47,680 --> 00:01:50,520 Speaker 1: the leaders. My name is Julie. I'm twenty one years old. 27 00:01:50,800 --> 00:01:55,440 Speaker 1: We consider that the government want to make us work 28 00:01:55,520 --> 00:02:00,000 Speaker 1: until That's what I think about young people who didn't 29 00:02:00,000 --> 00:02:04,720 Speaker 1: not study. They started working very very young, but we 30 00:02:04,760 --> 00:02:07,640 Speaker 1: will still ask them to work until sixty five. This 31 00:02:07,720 --> 00:02:12,799 Speaker 1: is scandalous, alarm and I was seventy one in solidarity 32 00:02:12,960 --> 00:02:15,760 Speaker 1: with that young people. It's a very bad, very firm 33 00:02:15,840 --> 00:02:19,120 Speaker 1: It's not the time, not a good idea. And my 34 00:02:19,160 --> 00:02:21,040 Speaker 1: name is Matthew. I'm forty seven years old. I'm an 35 00:02:21,040 --> 00:02:24,040 Speaker 1: English teacher and we're protesting because we don't want to 36 00:02:24,040 --> 00:02:26,840 Speaker 1: spend the rest of our life just working without the retirement. 37 00:02:27,120 --> 00:02:29,799 Speaker 1: There's money to be found in other places. I think 38 00:02:29,840 --> 00:02:33,000 Speaker 1: taxes could be raised in in different sectors and uh, 39 00:02:33,240 --> 00:02:36,239 Speaker 1: asking people to work just to avoid rising taxes is 40 00:02:36,280 --> 00:02:40,560 Speaker 1: probably not the solution. Mccrown has kind of made it 41 00:02:40,919 --> 00:02:45,919 Speaker 1: his pal mark that he's impervious to public opinion when 42 00:02:45,919 --> 00:02:47,760 Speaker 1: it comes to doing what he thinks is right for 43 00:02:47,800 --> 00:02:50,919 Speaker 1: the country. As you said, my current likes to think that, 44 00:02:51,000 --> 00:02:52,839 Speaker 1: you know, he's going to do it his way. He's 45 00:02:52,840 --> 00:02:55,880 Speaker 1: tried that several times and it hasn't worked out very 46 00:02:55,919 --> 00:02:58,799 Speaker 1: well for him. He had protests in the streets before 47 00:02:58,960 --> 00:03:02,800 Speaker 1: COVID over the same sort of you know, very stringent 48 00:03:03,520 --> 00:03:06,400 Speaker 1: pass cutting. Why is it that he thinks that the 49 00:03:06,440 --> 00:03:09,280 Speaker 1: French people are going to go along with this, That's 50 00:03:09,280 --> 00:03:11,720 Speaker 1: a really good question. I've kind of asked our colleagues 51 00:03:11,720 --> 00:03:15,799 Speaker 1: in Paris what his rationale for it is and they 52 00:03:16,000 --> 00:03:18,400 Speaker 1: they will tell you that he's just a very self 53 00:03:18,440 --> 00:03:23,840 Speaker 1: confident politician. He thinks that ultimately he can bring people 54 00:03:24,080 --> 00:03:28,640 Speaker 1: around with the power of his arguments, and also, you 55 00:03:28,680 --> 00:03:32,000 Speaker 1: know those people who ultimately aren't persuaded, well, you know, 56 00:03:32,200 --> 00:03:34,400 Speaker 1: they can get angry. And he's kind of betting that 57 00:03:34,480 --> 00:03:38,880 Speaker 1: he'll be able to you know, a combination of enough determination, 58 00:03:39,520 --> 00:03:42,560 Speaker 1: enough public information making his case the people that will 59 00:03:42,560 --> 00:03:45,320 Speaker 1: be able to peel off enough support from the strikers 60 00:03:45,360 --> 00:03:48,120 Speaker 1: that they become marginalized and ultimately he can push his 61 00:03:48,160 --> 00:03:51,000 Speaker 1: plans through. I mean that the thing is, at the 62 00:03:51,080 --> 00:03:53,880 Speaker 1: end of the day, the retirement age sixty two. I'm 63 00:03:53,920 --> 00:03:55,960 Speaker 1: not expecting I'm going to retire at sixty two, and 64 00:03:56,000 --> 00:03:57,880 Speaker 1: I would take sixty four if you offered it to 65 00:03:57,920 --> 00:04:01,360 Speaker 1: me now. So it's difficult, I think, was to really 66 00:04:01,760 --> 00:04:04,720 Speaker 1: understand why the bunch of people are so angry about this. 67 00:04:05,080 --> 00:04:07,640 Speaker 1: But you know, that's the culture of France, and that's 68 00:04:07,680 --> 00:04:09,880 Speaker 1: the approach that you know, so many of these unions, 69 00:04:09,880 --> 00:04:13,680 Speaker 1: these public set to workers have Nancy Ben described pensions 70 00:04:13,720 --> 00:04:16,320 Speaker 1: as the third rail of French politics. That is the 71 00:04:16,440 --> 00:04:19,279 Speaker 1: very expression that's always been used in the U S 72 00:04:19,279 --> 00:04:23,080 Speaker 1: when it comes to social security and other entitlements. And 73 00:04:23,240 --> 00:04:26,039 Speaker 1: right now in the US we're seeing this big fight 74 00:04:26,120 --> 00:04:30,720 Speaker 1: between Joe Biden and the Republicans over whether or not 75 00:04:31,240 --> 00:04:34,880 Speaker 1: Republicans in Congress are going to try to in some 76 00:04:34,920 --> 00:04:38,239 Speaker 1: way cur tail or limit Social Security to get ahold 77 00:04:38,279 --> 00:04:40,320 Speaker 1: of costs. There was a big speech in the U 78 00:04:40,400 --> 00:04:43,400 Speaker 1: S the State of the Union, and Joe Biden really 79 00:04:43,440 --> 00:04:46,640 Speaker 1: seized on this idea of Republicans wanting to cut Social 80 00:04:46,640 --> 00:04:50,800 Speaker 1: Security and medicare, you know, as something Republicans want to 81 00:04:50,800 --> 00:04:53,680 Speaker 1: do that is a third rail here as well. Some 82 00:04:53,800 --> 00:04:57,520 Speaker 1: of my Republican friends, I want to take the economy hostage. 83 00:04:57,560 --> 00:05:00,760 Speaker 1: I get it, unless I agree to the record plans. 84 00:05:01,920 --> 00:05:04,200 Speaker 1: All you at home should know what those plans are. 85 00:05:05,720 --> 00:05:07,880 Speaker 1: Instead of making the wealthy pay their fair share of 86 00:05:07,880 --> 00:05:12,719 Speaker 1: some Republicans, some Republicans want Medicare and SOUF security sunset. 87 00:05:12,839 --> 00:05:18,280 Speaker 1: I'm not saying it's a majority of senior citizens here 88 00:05:18,360 --> 00:05:21,280 Speaker 1: vote in huge numbers, and so basically he's really trying 89 00:05:21,279 --> 00:05:23,800 Speaker 1: to put Republicans on the defensive and say this is 90 00:05:23,839 --> 00:05:27,200 Speaker 1: something you want to do. In reality of Florida, Senator 91 00:05:27,320 --> 00:05:30,800 Speaker 1: Rick Scott, who ran the political group that wanted to 92 00:05:30,839 --> 00:05:34,839 Speaker 1: get Republican senators elected this past mid term cycle, did 93 00:05:34,880 --> 00:05:37,599 Speaker 1: put forward a plan saying that he thought all federal 94 00:05:37,640 --> 00:05:41,599 Speaker 1: programs should sunset and be re evaluated after five years. 95 00:05:41,920 --> 00:05:43,560 Speaker 1: So this is a plan he put out. It was 96 00:05:43,640 --> 00:05:47,640 Speaker 1: not like a widespread Republican plan. However, the Biden White 97 00:05:47,680 --> 00:05:50,200 Speaker 1: House has seized on this as like one of their 98 00:05:50,279 --> 00:05:54,279 Speaker 1: key foils heading into and they are really hammering the 99 00:05:54,320 --> 00:05:56,719 Speaker 1: Republicans home on it. It came up in the State 100 00:05:56,720 --> 00:05:59,440 Speaker 1: of the Union, a bunch of Republicans booed him, but 101 00:05:59,520 --> 00:06:02,280 Speaker 1: The President then went to Tampa, Florida and sort of 102 00:06:02,320 --> 00:06:05,160 Speaker 1: reiterated this. You know, Florida, as you know, has a 103 00:06:05,160 --> 00:06:07,839 Speaker 1: ton of old people who live there and retired there. 104 00:06:08,160 --> 00:06:10,080 Speaker 1: So this is going to be a really key thing 105 00:06:10,200 --> 00:06:14,080 Speaker 1: heading into the election, with Biden trying to draw a 106 00:06:14,160 --> 00:06:16,960 Speaker 1: contrast with Republicans saying, you know, he wants to keep 107 00:06:17,000 --> 00:06:19,919 Speaker 1: these programs intact. He's a defender of them and trying 108 00:06:19,920 --> 00:06:22,360 Speaker 1: to argue that Republicans want to cut them, and even 109 00:06:22,400 --> 00:06:26,400 Speaker 1: the Senate Leader, Mitch McConnell, the Republican leader, came forward 110 00:06:26,440 --> 00:06:28,480 Speaker 1: to say, no, we're not going to do that. We're 111 00:06:28,520 --> 00:06:31,240 Speaker 1: not touching social Security. So you can see the Republicans 112 00:06:31,360 --> 00:06:34,440 Speaker 1: running away from this idea themselves. They're totally running away 113 00:06:34,480 --> 00:06:37,320 Speaker 1: from it because they understand how important it is to 114 00:06:37,640 --> 00:06:40,880 Speaker 1: senior citizens and people that vote. And in America, you 115 00:06:40,880 --> 00:06:43,760 Speaker 1: have to remember that Social Security is viewed a little 116 00:06:43,800 --> 00:06:47,000 Speaker 1: bit differently than other entitlement programs like food stamps or 117 00:06:47,040 --> 00:06:50,679 Speaker 1: Section eight vouchers for housing, because social Security is viewed 118 00:06:50,720 --> 00:06:53,680 Speaker 1: as something that workers, you know, are taxed on throughout 119 00:06:53,720 --> 00:06:56,120 Speaker 1: their working lives and they've paid into it, and so 120 00:06:56,320 --> 00:06:59,119 Speaker 1: it's viewed as something where you know, I have paid 121 00:06:59,160 --> 00:07:02,120 Speaker 1: into this part of money for my whole career, and 122 00:07:02,160 --> 00:07:04,800 Speaker 1: I deserve these benefits and any cuts to them are 123 00:07:04,839 --> 00:07:07,680 Speaker 1: basically like taking money away from people which they have 124 00:07:07,720 --> 00:07:10,520 Speaker 1: already set aside, and people do not like it. You know, 125 00:07:10,560 --> 00:07:13,960 Speaker 1: It's really similar the situation in Europe. You're seeing across 126 00:07:14,040 --> 00:07:17,120 Speaker 1: the content a whole bunch of countries where governments are 127 00:07:17,240 --> 00:07:20,240 Speaker 1: trying to just to stretch the system, to turn the 128 00:07:20,280 --> 00:07:22,920 Speaker 1: dial a little bit, to make these systems more sustainable 129 00:07:23,040 --> 00:07:25,880 Speaker 1: over the long run, and it makes people really angry. 130 00:07:26,080 --> 00:07:28,920 Speaker 1: We're not just talking about France, in Italy, in Spain, 131 00:07:29,400 --> 00:07:32,560 Speaker 1: in the UK, all of these countries particularly there are 132 00:07:32,600 --> 00:07:37,200 Speaker 1: European countries often where the budget situation is not the 133 00:07:37,280 --> 00:07:40,560 Speaker 1: strongest and where the state pension system is one of 134 00:07:40,560 --> 00:07:43,960 Speaker 1: the major liabilities at the moment. Look forward into the 135 00:07:43,960 --> 00:07:47,400 Speaker 1: future and the ratio of workers to people over sixty 136 00:07:47,400 --> 00:07:49,360 Speaker 1: five just gets worse and worse and worse, and and 137 00:07:49,400 --> 00:07:51,640 Speaker 1: that situation is just going to get so much more acute. 138 00:07:52,280 --> 00:07:54,080 Speaker 1: So we have this problem. It has to be solved. 139 00:07:54,080 --> 00:07:57,000 Speaker 1: I mean, the reason why they're doing this isn't punished seniors. 140 00:07:57,000 --> 00:07:59,600 Speaker 1: It's because there isn't enough money to pay them out 141 00:07:59,760 --> 00:08:03,200 Speaker 1: espe actually because there are fewer younger workers than there 142 00:08:03,200 --> 00:08:08,720 Speaker 1: are people now retired. So what is the answer. We've 143 00:08:08,760 --> 00:08:12,040 Speaker 1: seen any number of things come along. You raise the 144 00:08:12,080 --> 00:08:15,560 Speaker 1: retirement age, you cut benefits, or you means tested so 145 00:08:15,640 --> 00:08:19,560 Speaker 1: that wealthier people, you know, get less money. But nancy 146 00:08:19,560 --> 00:08:22,640 Speaker 1: are any of those things likely to fly well. So 147 00:08:22,680 --> 00:08:25,800 Speaker 1: the last time Social Security was really changed like in 148 00:08:25,840 --> 00:08:29,640 Speaker 1: a big meaningful way was under Ronald Reagan, you know, 149 00:08:29,680 --> 00:08:32,400 Speaker 1: the Republican president, and then a Democratic Speaker of the House, 150 00:08:32,400 --> 00:08:36,079 Speaker 1: Tip O'Neill, changed it and made some tweaks to make 151 00:08:36,120 --> 00:08:38,439 Speaker 1: it more sustainable. So that was the last time this 152 00:08:38,559 --> 00:08:42,000 Speaker 1: came about. I think that one other sort of wonky 153 00:08:42,120 --> 00:08:44,920 Speaker 1: idea that people have talked about, or the policy wonks 154 00:08:44,960 --> 00:08:47,480 Speaker 1: have talked about, is there is a limit of how 155 00:08:47,600 --> 00:08:50,880 Speaker 1: much of one salary is taxed for Social Security. And 156 00:08:50,960 --> 00:08:53,440 Speaker 1: so one idea that people have had is you could 157 00:08:53,480 --> 00:08:56,360 Speaker 1: raise the amount of one salary that is taxed, so 158 00:08:56,440 --> 00:08:59,400 Speaker 1: people who have higher salaries would pay like a greater 159 00:08:59,480 --> 00:09:02,240 Speaker 1: share for their salary. And that's one way to do it, 160 00:09:02,280 --> 00:09:04,200 Speaker 1: and people who were in last would never hit the cap. 161 00:09:04,240 --> 00:09:06,760 Speaker 1: And so in that way it's more progressive, right, so 162 00:09:06,840 --> 00:09:09,800 Speaker 1: a majority of Americans would not pay more. It would 163 00:09:09,840 --> 00:09:13,600 Speaker 1: just be the wealthy pay more into the Social Security 164 00:09:13,720 --> 00:09:15,839 Speaker 1: Trust Fund. But it is a problem that the United 165 00:09:15,840 --> 00:09:19,600 Speaker 1: States will have to solve. By five the taxes will 166 00:09:19,640 --> 00:09:22,160 Speaker 1: only pay for seventy of the benefits. So this is 167 00:09:22,200 --> 00:09:25,080 Speaker 1: something that politicians will have to grapple with. But the 168 00:09:25,160 --> 00:09:28,000 Speaker 1: thing is is that this is not something Joe Biden 169 00:09:28,040 --> 00:09:30,520 Speaker 1: wants to do. This is not really something that the 170 00:09:30,559 --> 00:09:33,320 Speaker 1: majority of Republicans want to do. And I would say 171 00:09:33,360 --> 00:09:36,640 Speaker 1: a decade ago there was more appetite to deal with 172 00:09:36,760 --> 00:09:41,079 Speaker 1: these deficit busting issues, um when President Obama was president, 173 00:09:41,160 --> 00:09:44,960 Speaker 1: but really like President Trump blew through the deficit, you know, 174 00:09:45,040 --> 00:09:46,560 Speaker 1: that was not sort of a thing that he was 175 00:09:46,600 --> 00:09:49,000 Speaker 1: interested in, and so both parties really just like don't 176 00:09:49,000 --> 00:09:50,560 Speaker 1: want to talk about it at this point. This is 177 00:09:50,600 --> 00:09:53,520 Speaker 1: not the time for budget hawks in d C. And 178 00:09:53,559 --> 00:09:55,920 Speaker 1: so it's an issue that they keep pushing off. So 179 00:09:56,000 --> 00:09:58,079 Speaker 1: it seems like the answer for the US is it's 180 00:09:58,080 --> 00:10:00,760 Speaker 1: gonna be somebody else's problem once I'm already gone from Harvist. 181 00:10:01,240 --> 00:10:04,200 Speaker 1: Then what about in Europe? We have a lot of countries, 182 00:10:04,480 --> 00:10:08,120 Speaker 1: different governments, different approaches. What are some of the ways 183 00:10:08,120 --> 00:10:10,880 Speaker 1: that they're trying to get their arms around us. With 184 00:10:11,000 --> 00:10:13,520 Speaker 1: the exception of Makron, I mean, he's really out in 185 00:10:13,520 --> 00:10:15,720 Speaker 1: front in terms of trying to tackle it. But I 186 00:10:15,760 --> 00:10:18,600 Speaker 1: don't think that shifting the retirement age from sixty two 187 00:10:18,640 --> 00:10:21,120 Speaker 1: to sixty four. It's symbolic and that kind of opens 188 00:10:21,360 --> 00:10:24,120 Speaker 1: the process of making the system sustainable, but it's not 189 00:10:24,200 --> 00:10:27,800 Speaker 1: a fix in itself. My kind of guess is that 190 00:10:27,840 --> 00:10:30,000 Speaker 1: will you know you've you've seen how this works, wears 191 00:10:30,000 --> 00:10:31,839 Speaker 1: in you'r we just muddel on a mudel on mudel 192 00:10:31,960 --> 00:10:35,160 Speaker 1: until we reach a crisis. In this situation, I think 193 00:10:35,160 --> 00:10:37,719 Speaker 1: there'll be a lot of muddeling on and then there 194 00:10:37,840 --> 00:10:40,839 Speaker 1: is one solution out there, but it's arguably even more 195 00:10:40,920 --> 00:10:45,079 Speaker 1: controversial than pension reform itself. That's immigration. There's going to 196 00:10:45,160 --> 00:10:48,600 Speaker 1: be tons of pressure for immigration into the EU in 197 00:10:48,679 --> 00:10:50,599 Speaker 1: the decades ahead. I'm sure it's going to be the 198 00:10:50,679 --> 00:10:52,640 Speaker 1: same in the US, and Nancy could speak to that. 199 00:10:52,920 --> 00:10:54,440 Speaker 1: But you know, when you get to the point where 200 00:10:54,440 --> 00:10:56,920 Speaker 1: the number of workers is declining year after year, and 201 00:10:56,960 --> 00:11:00,560 Speaker 1: that's hitting not just the pension system but GDP growth 202 00:11:00,640 --> 00:11:03,760 Speaker 1: and inflation and all these issues, there's a lot of 203 00:11:03,760 --> 00:11:05,600 Speaker 1: people who want to come in and work. But that's 204 00:11:05,640 --> 00:11:08,320 Speaker 1: just a really difficult political issue to open up at 205 00:11:08,360 --> 00:11:10,160 Speaker 1: this stage. When you get to a crisis, it's gonna 206 00:11:10,160 --> 00:11:12,160 Speaker 1: look a bit different. Yeah, I agree with that. I 207 00:11:12,200 --> 00:11:15,040 Speaker 1: think that, you know, immigration is something that could definitely 208 00:11:15,080 --> 00:11:16,800 Speaker 1: help as well, because it would expand the U S 209 00:11:16,840 --> 00:11:20,160 Speaker 1: tax space and we've seen so many immigration restrictions in 210 00:11:20,200 --> 00:11:22,800 Speaker 1: the US. But you know, just like social security and 211 00:11:22,840 --> 00:11:25,559 Speaker 1: medicare are the third rail in politics, so is immigration 212 00:11:25,640 --> 00:11:28,160 Speaker 1: right now, particularly for Democrats who feel like they don't 213 00:11:28,160 --> 00:11:30,800 Speaker 1: really have a solution for it. And so it's like 214 00:11:31,240 --> 00:11:34,640 Speaker 1: all the third rails of politics in one part. You know, then, 215 00:11:34,880 --> 00:11:37,079 Speaker 1: as you say, beautifully put it, things will sort of 216 00:11:37,160 --> 00:11:40,160 Speaker 1: muddele on until it reaches a crisis. How many years 217 00:11:40,160 --> 00:11:43,760 Speaker 1: are we looking at for France, for Italy, the UK 218 00:11:44,040 --> 00:11:47,720 Speaker 1: before the bill comes due and we reached the point 219 00:11:47,720 --> 00:11:50,280 Speaker 1: where something has to be done. That's a good question. 220 00:11:50,720 --> 00:11:53,199 Speaker 1: Maybe not this crisis, but one of these crisis somewhere 221 00:11:53,240 --> 00:11:55,720 Speaker 1: along the way. The problems in the social security system 222 00:11:55,760 --> 00:11:58,040 Speaker 1: are going to become a major factor for the sustainability 223 00:11:58,080 --> 00:11:59,839 Speaker 1: of the public accounts. And that's when you're going to 224 00:12:00,600 --> 00:12:03,720 Speaker 1: late night you know, high stakes negotiations to sort this out. 225 00:12:04,400 --> 00:12:05,959 Speaker 1: That will be the same thing in the US. The 226 00:12:06,040 --> 00:12:08,360 Speaker 1: US will model along for the next decade until it's 227 00:12:08,360 --> 00:12:11,880 Speaker 1: a major crisis. And the last time they reformed Social Security, 228 00:12:12,120 --> 00:12:14,839 Speaker 1: it was really like, you know, an eleventh hour deal 229 00:12:15,200 --> 00:12:18,760 Speaker 1: and when there was real solvency of it up for 230 00:12:18,840 --> 00:12:23,000 Speaker 1: grabs and these you know, Republican president and Democratic Speaker 231 00:12:23,000 --> 00:12:25,560 Speaker 1: of the House came together. But it was really something 232 00:12:25,600 --> 00:12:27,240 Speaker 1: that they did at the last minute, and that is 233 00:12:27,280 --> 00:12:30,920 Speaker 1: the way Washington works. Nancy Cook, Ben Sills, thanks for 234 00:12:30,960 --> 00:12:33,720 Speaker 1: coming on the show. Thank you very much. Thanks so much. 235 00:12:35,120 --> 00:12:38,920 Speaker 1: When we come back, all kinds of unpopular ideas to 236 00:12:39,040 --> 00:12:49,679 Speaker 1: fix this problem, as we've heard, there's not enough money 237 00:12:50,080 --> 00:12:53,640 Speaker 1: and not a lot of political will. What do we do. 238 00:12:54,480 --> 00:12:58,920 Speaker 1: My Bloomberg colleagues Amy Bainbridge, Ainsley Thompson, and Emily Kadman 239 00:12:59,040 --> 00:13:01,480 Speaker 1: are here with me now. They've been going country to 240 00:13:01,559 --> 00:13:05,240 Speaker 1: country to try to find a way out. Emily, maybe 241 00:13:05,280 --> 00:13:08,640 Speaker 1: I'll start with you. We're seeing this tension over retirement 242 00:13:08,760 --> 00:13:12,720 Speaker 1: ages happening all over the world between governments and workers 243 00:13:12,760 --> 00:13:16,040 Speaker 1: who are feeling like they're changing the rules of the 244 00:13:16,080 --> 00:13:19,000 Speaker 1: game on them. Yes, I think this story is something 245 00:13:19,040 --> 00:13:23,439 Speaker 1: that taps into something that cuts across cultures, across classes, 246 00:13:23,920 --> 00:13:28,760 Speaker 1: across you know, many many different things. Fundamentally, many of us, 247 00:13:29,120 --> 00:13:31,760 Speaker 1: I'm in my forts. You know, we watched our grandparents, 248 00:13:31,760 --> 00:13:34,160 Speaker 1: We watched our parents, We watched people be able to 249 00:13:34,280 --> 00:13:38,400 Speaker 1: retire in their sixties, sometimes even younger, and that kind 250 00:13:38,400 --> 00:13:42,360 Speaker 1: of seemed like the norm. But that's just really not true. Now. 251 00:13:42,400 --> 00:13:45,319 Speaker 1: You know, I'm sitting here in Sydney and I'm looking at, 252 00:13:45,320 --> 00:13:48,040 Speaker 1: you know, a state pension age of around sixty eight. 253 00:13:48,280 --> 00:13:51,319 Speaker 1: That seems a very very long time away. Now I'm 254 00:13:51,320 --> 00:13:53,960 Speaker 1: in a privileged position, you know, in that I will 255 00:13:54,000 --> 00:13:58,079 Speaker 1: probably be okay. But you know, many other people are 256 00:13:58,160 --> 00:14:00,240 Speaker 1: worried about how they can stay in the work force 257 00:14:00,320 --> 00:14:02,960 Speaker 1: until that long. And you know, will they be able 258 00:14:03,000 --> 00:14:04,680 Speaker 1: to find a job, will be able to stay in 259 00:14:04,679 --> 00:14:07,680 Speaker 1: a job, Will companies want to hire them when they're 260 00:14:07,679 --> 00:14:11,120 Speaker 1: in their sixties? But you know, this really is something 261 00:14:11,160 --> 00:14:13,959 Speaker 1: that cuts across everywhere once you start looking for it. 262 00:14:14,200 --> 00:14:16,680 Speaker 1: There are so many countries where people are starting to 263 00:14:16,720 --> 00:14:19,520 Speaker 1: push back, starting to push back against the idea that 264 00:14:19,560 --> 00:14:22,080 Speaker 1: they think the rules of the game have changed. The 265 00:14:22,160 --> 00:14:25,840 Speaker 1: trouble is that for governments, the economics are really quite 266 00:14:25,920 --> 00:14:31,000 Speaker 1: frightening as the population ages, fertility rates have dropped, so 267 00:14:31,040 --> 00:14:33,040 Speaker 1: they just simply aren't going to be the same number 268 00:14:33,040 --> 00:14:35,720 Speaker 1: of workers for the same number of retired people there 269 00:14:35,760 --> 00:14:38,800 Speaker 1: were when these systems were set up. So it's a 270 00:14:38,920 --> 00:14:42,680 Speaker 1: very difficult dilemma for governments because if they don't do anything, 271 00:14:42,840 --> 00:14:45,280 Speaker 1: if we all retired at the same age that maybe 272 00:14:45,320 --> 00:14:49,600 Speaker 1: our parents did, well, then the bill is going to 273 00:14:49,680 --> 00:14:52,600 Speaker 1: get bigger, bigger and bigger, and then may well be 274 00:14:52,800 --> 00:14:56,280 Speaker 1: little money left for other key spending priorities. I would 275 00:14:56,320 --> 00:15:00,880 Speaker 1: also add with that, once we started looking those central 276 00:15:00,960 --> 00:15:05,120 Speaker 1: themes around the anxiety about when exactly you'll be able 277 00:15:05,120 --> 00:15:08,560 Speaker 1: to exit the workforce exists almost everywhere and different countries 278 00:15:08,600 --> 00:15:12,000 Speaker 1: are grappling with this in different ways. So where I'm 279 00:15:12,000 --> 00:15:15,360 Speaker 1: speaking to you from in Australia, the pension age, the 280 00:15:15,360 --> 00:15:18,520 Speaker 1: state pension age is still really it's safety net. There 281 00:15:18,600 --> 00:15:22,280 Speaker 1: is a private saving system here, it's been around for 282 00:15:22,320 --> 00:15:25,880 Speaker 1: three decades, but it does largely benefit people that have 283 00:15:25,960 --> 00:15:29,040 Speaker 1: an unbroken stream of employment, who are in a decent 284 00:15:29,120 --> 00:15:31,960 Speaker 1: paid job, who work full time. It does mean there's 285 00:15:31,960 --> 00:15:33,960 Speaker 1: still a lot of people that don't have a great 286 00:15:34,040 --> 00:15:37,680 Speaker 1: private savings behind them, so there's still a big reliance 287 00:15:37,800 --> 00:15:40,360 Speaker 1: on the state public pension and what the government here 288 00:15:40,400 --> 00:15:43,440 Speaker 1: has asked people to do is work longer before you 289 00:15:43,520 --> 00:15:47,360 Speaker 1: get that. And Australia is far from isolated. Many many 290 00:15:47,360 --> 00:15:50,600 Speaker 1: other countries are doing exactly the same thing, and it 291 00:15:50,680 --> 00:15:53,960 Speaker 1: means that there's kind of this deadline that keeps moving 292 00:15:54,440 --> 00:15:57,960 Speaker 1: and people are not happy about it. And I think 293 00:15:58,000 --> 00:16:01,120 Speaker 1: the interesting thing is it's so many different cultures as well. 294 00:16:01,400 --> 00:16:05,080 Speaker 1: So for example, in China, where you know, the retirement 295 00:16:05,080 --> 00:16:07,720 Speaker 1: age hasn't actually changed in four decades, there have been 296 00:16:08,160 --> 00:16:11,600 Speaker 1: multiple attempts by the Communist Party to encourage people to 297 00:16:11,640 --> 00:16:15,240 Speaker 1: work for longer, every time they've been met with huge 298 00:16:15,360 --> 00:16:19,280 Speaker 1: popular resistance. And then you switch to somewhere like Ireland, 299 00:16:19,640 --> 00:16:23,120 Speaker 1: where in a recent election a proposal to raise the 300 00:16:23,160 --> 00:16:26,680 Speaker 1: retirement age had to be dropped after the popular backlash. 301 00:16:27,120 --> 00:16:30,880 Speaker 1: So it's one of these things that really does take 302 00:16:30,960 --> 00:16:33,960 Speaker 1: us around the globe. And as Amie said, every pension 303 00:16:34,000 --> 00:16:38,320 Speaker 1: system is different, but the same kind of universal themes 304 00:16:38,360 --> 00:16:40,280 Speaker 1: come through. I was just going to say, it is 305 00:16:40,320 --> 00:16:44,520 Speaker 1: such a politically sensitive subject, as you say, and it's 306 00:16:44,560 --> 00:16:47,960 Speaker 1: a huge voter group that is affected. So I think 307 00:16:48,040 --> 00:16:52,440 Speaker 1: often politicians have been loath to get involved to an extent, 308 00:16:52,800 --> 00:16:55,680 Speaker 1: but at the same time we have this big fiscal 309 00:16:55,800 --> 00:16:58,520 Speaker 1: issue that they need to do something. I mean, I 310 00:16:58,520 --> 00:17:00,640 Speaker 1: think one of the difficulties is with you know, some 311 00:17:00,720 --> 00:17:05,560 Speaker 1: other difficult reforms. The interests of different generations are different, 312 00:17:05,680 --> 00:17:08,560 Speaker 1: right you know, think think of housing, you know, the 313 00:17:08,640 --> 00:17:12,360 Speaker 1: younger generation. This is another universal issue across many things. 314 00:17:12,640 --> 00:17:15,239 Speaker 1: Can't afford to buy houses. You know, there would be 315 00:17:15,280 --> 00:17:21,280 Speaker 1: a considerable supporter base for reforms to make housing cheaper. 316 00:17:21,840 --> 00:17:24,960 Speaker 1: And yet when it comes to pensions, there's not that 317 00:17:25,119 --> 00:17:29,520 Speaker 1: same kind of generational conflict going on because we all 318 00:17:29,560 --> 00:17:32,359 Speaker 1: expect to retire at some point. We all hope to 319 00:17:32,400 --> 00:17:35,760 Speaker 1: retire at some point. So when you talk about raising 320 00:17:35,800 --> 00:17:38,200 Speaker 1: the retirement age, it's not only those people who will 321 00:17:38,280 --> 00:17:41,080 Speaker 1: be imminently affected, you know, in the next ten years 322 00:17:41,119 --> 00:17:43,679 Speaker 1: who are angry. Is there's people much younger who are 323 00:17:43,680 --> 00:17:46,920 Speaker 1: now looking at the goalpost shifting for when they get older. 324 00:17:47,440 --> 00:17:51,720 Speaker 1: So it can have despite the many fiscal consequences and 325 00:17:51,760 --> 00:17:54,480 Speaker 1: the many problems of it, it can be very hard 326 00:17:54,520 --> 00:17:58,639 Speaker 1: to build a constituency for change. How is it that 327 00:17:58,920 --> 00:18:02,760 Speaker 1: so many countries us around the world with entirely different economies, 328 00:18:02,800 --> 00:18:06,760 Speaker 1: different forms of government all pretty much at the same time, 329 00:18:06,960 --> 00:18:11,960 Speaker 1: are facing this dramatic shortfall. I guess there's this huge 330 00:18:12,040 --> 00:18:17,400 Speaker 1: demographic shift that's happened over the past few decades, and 331 00:18:17,520 --> 00:18:19,399 Speaker 1: it's really we're coming to the point end of that. 332 00:18:19,680 --> 00:18:22,719 Speaker 1: According to the best available data from the Organization for 333 00:18:22,760 --> 00:18:26,080 Speaker 1: Economic Cooperation and Development, the o e c D, back 334 00:18:26,960 --> 00:18:29,080 Speaker 1: pensions consumed about five and a half percent of g 335 00:18:29,200 --> 00:18:32,560 Speaker 1: d P and by twenty forty that could top about ten. 336 00:18:33,600 --> 00:18:36,400 Speaker 1: So you know, the stats are in and I guess 337 00:18:36,400 --> 00:18:38,560 Speaker 1: the other thing that we haven't talked about is when 338 00:18:38,560 --> 00:18:40,760 Speaker 1: you look at the demographic shift, a lot of people 339 00:18:40,760 --> 00:18:45,040 Speaker 1: are also working entering the workforce later, so more people 340 00:18:45,040 --> 00:18:47,280 Speaker 1: are getting educated, for example, so they might not work 341 00:18:47,359 --> 00:18:50,720 Speaker 1: into the workforce proper until they're early to mid twenties sometime. 342 00:18:51,119 --> 00:18:55,440 Speaker 1: So that again shifts that economic base as well. And 343 00:18:55,440 --> 00:18:58,560 Speaker 1: we know that that base is shrinking, and all the 344 00:18:58,600 --> 00:19:00,800 Speaker 1: experts say, look, you have to do something about it. 345 00:19:00,880 --> 00:19:04,600 Speaker 1: So there has been this gradual rise around the world. 346 00:19:04,640 --> 00:19:07,840 Speaker 1: I think the highest retirement age it's getting up to 347 00:19:07,920 --> 00:19:11,359 Speaker 1: now almost seventy in some countries. That's not the norm, 348 00:19:11,440 --> 00:19:14,840 Speaker 1: it must be said, but depending on the particular situation, 349 00:19:14,960 --> 00:19:18,199 Speaker 1: in a country you have to be quite extreme. I 350 00:19:18,200 --> 00:19:21,760 Speaker 1: guess what's happening here in Australia and make it harder 351 00:19:21,840 --> 00:19:25,320 Speaker 1: say something like Frances. Australia has sort of introduced this 352 00:19:25,480 --> 00:19:29,239 Speaker 1: incremental shift, so it wasn't like we woke up one 353 00:19:29,320 --> 00:19:31,840 Speaker 1: day and all of a sudden the retirement age became 354 00:19:31,880 --> 00:19:34,520 Speaker 1: sixty seven. We're gradually working up to that over a 355 00:19:34,560 --> 00:19:37,639 Speaker 1: period of years, and so people had kind of this 356 00:19:37,760 --> 00:19:40,720 Speaker 1: time to ease into it. But I think that message 357 00:19:40,800 --> 00:19:44,160 Speaker 1: in France and other countries, it's pretty extreme and it's 358 00:19:44,359 --> 00:19:47,399 Speaker 1: not very palatable for people. It can be quite a shock. 359 00:19:47,760 --> 00:19:49,840 Speaker 1: It's a real skill to try and take the population 360 00:19:49,880 --> 00:19:53,160 Speaker 1: with you and explain the reasons why this is needed. Yeah, 361 00:19:53,200 --> 00:19:55,520 Speaker 1: and some of the countries where we sort of aren't 362 00:19:55,560 --> 00:19:58,560 Speaker 1: seeing the same kind of level of people literally on 363 00:19:58,600 --> 00:20:02,840 Speaker 1: the streets. One thing that has been gaining some popularity 364 00:20:03,000 --> 00:20:08,480 Speaker 1: is attempting to automatically link pension increases to life expectancy, um, 365 00:20:08,520 --> 00:20:12,120 Speaker 1: you know, a purely mathematical link, and that in some 366 00:20:12,160 --> 00:20:15,880 Speaker 1: ways is aimed to take some of this emotion out 367 00:20:15,880 --> 00:20:19,639 Speaker 1: of the situation. You know, it's mainly broad generalization, but 368 00:20:19,720 --> 00:20:22,600 Speaker 1: countries in Northern Europe right now, we are experimenting with that, 369 00:20:22,720 --> 00:20:25,680 Speaker 1: and you know, it's relatively new, and you know, we'll 370 00:20:25,760 --> 00:20:29,359 Speaker 1: kind of see how that plays out over time, but 371 00:20:29,600 --> 00:20:31,879 Speaker 1: you know, that is one way that people are trying 372 00:20:31,960 --> 00:20:35,119 Speaker 1: to do it, and that may take some of the 373 00:20:35,160 --> 00:20:38,440 Speaker 1: emotion out. As we talked about. Ireland is quite an 374 00:20:38,520 --> 00:20:40,680 Speaker 1: interesting one as well. They were trying to raise the 375 00:20:40,720 --> 00:20:45,199 Speaker 1: retirement age. They dropped it proposal because there was this 376 00:20:45,240 --> 00:20:49,320 Speaker 1: popular backlash during the election, and instead they're telling people 377 00:20:49,400 --> 00:20:51,480 Speaker 1: that if they work for longer, they will get a 378 00:20:51,560 --> 00:20:54,760 Speaker 1: higher pension for each year that they keep working over 379 00:20:54,760 --> 00:20:57,560 Speaker 1: the age of sixty six. So that's quite an interesting 380 00:20:57,560 --> 00:20:59,640 Speaker 1: way of doing it as well. I think, to sort 381 00:20:59,680 --> 00:21:03,040 Speaker 1: of courage people to keep working if they're able, not 382 00:21:03,080 --> 00:21:05,520 Speaker 1: saying you can't get your pension, but if you're able 383 00:21:05,560 --> 00:21:08,480 Speaker 1: and keep working, you'll get higher pension. I think we're 384 00:21:08,480 --> 00:21:13,639 Speaker 1: seeing some creative solutions coming out easy. In your story, 385 00:21:13,680 --> 00:21:17,680 Speaker 1: you also write that one of the reasons this has 386 00:21:17,760 --> 00:21:21,200 Speaker 1: become such a crisis is that people are just living longer. 387 00:21:21,720 --> 00:21:25,399 Speaker 1: When these systems were set up, people tended to be 388 00:21:25,480 --> 00:21:27,879 Speaker 1: retired only for a short time before the end of 389 00:21:27,920 --> 00:21:31,440 Speaker 1: their lives, and now people's lives have stretched on. Yes, 390 00:21:31,520 --> 00:21:34,160 Speaker 1: that's right, and that's one of the arguments I guess 391 00:21:34,280 --> 00:21:37,639 Speaker 1: governments make for raising the retirement age. They're like, well, 392 00:21:37,880 --> 00:21:39,760 Speaker 1: you're still going to have the same amount of years 393 00:21:40,400 --> 00:21:44,000 Speaker 1: in retirement because you're living longer now, so therefore you 394 00:21:44,040 --> 00:21:47,240 Speaker 1: should be working longer. It doesn't always wash with the 395 00:21:47,280 --> 00:21:49,879 Speaker 1: public though. I don't think that that argument, because they 396 00:21:49,880 --> 00:21:52,280 Speaker 1: were expecting to retire to have this pension at a 397 00:21:52,320 --> 00:21:55,040 Speaker 1: certain age. And just going back to that question of 398 00:21:55,160 --> 00:22:00,239 Speaker 1: life expectancy, worst which we saw a really extraordinary rump up. 399 00:22:00,640 --> 00:22:04,360 Speaker 1: It was getting better and better every single year. I mean, 400 00:22:04,400 --> 00:22:07,400 Speaker 1: what is true is that rate of acceleration has slowed 401 00:22:07,920 --> 00:22:12,160 Speaker 1: the expansion of public health care systems, and the amazing 402 00:22:12,200 --> 00:22:16,240 Speaker 1: advances in medical technology have helped make us live long 403 00:22:16,280 --> 00:22:18,359 Speaker 1: with a lot of things. But now we are getting 404 00:22:18,400 --> 00:22:20,960 Speaker 1: into a lot of issues around things like chronic disease. 405 00:22:21,480 --> 00:22:24,480 Speaker 1: If you had cancer fifty years ago, you would probably 406 00:22:24,840 --> 00:22:29,159 Speaker 1: brutally die relatively quickly. Now, modern medicine can help expand 407 00:22:29,200 --> 00:22:32,240 Speaker 1: your lifespan, but is it expanding your lifespan in a 408 00:22:32,280 --> 00:22:35,640 Speaker 1: way that you can actually meaningfully work. This is where 409 00:22:35,640 --> 00:22:38,040 Speaker 1: we're starting to get to the pointy end of what 410 00:22:38,160 --> 00:22:42,480 Speaker 1: life expectancy actually means, and this concept of healthily life expectancy, 411 00:22:42,720 --> 00:22:45,679 Speaker 1: how long are you going to live without major diseases, 412 00:22:45,760 --> 00:22:49,520 Speaker 1: major illness, whether it's you know, diabetes, whether it's cancer, 413 00:22:49,600 --> 00:22:53,720 Speaker 1: whether it's obesity. There are a lot of chronic diseases 414 00:22:53,800 --> 00:22:58,440 Speaker 1: now that make people's ability to work later hard. Even 415 00:22:58,480 --> 00:23:10,560 Speaker 1: if they are living later, we'll be right back. Any 416 00:23:10,640 --> 00:23:13,160 Speaker 1: One thing that comes through in your story is how 417 00:23:13,280 --> 00:23:17,359 Speaker 1: this issue exposes these tensions between various parts of society, 418 00:23:17,480 --> 00:23:21,040 Speaker 1: where people who live longer are often those who had 419 00:23:21,119 --> 00:23:24,120 Speaker 1: less physically demanding jobs and made more money, and yet 420 00:23:24,160 --> 00:23:26,640 Speaker 1: they'll wind up getting more money than those who need 421 00:23:26,680 --> 00:23:30,719 Speaker 1: it most and perhaps need to retire earlier because jobs 422 00:23:30,760 --> 00:23:34,000 Speaker 1: took a bigger toll on their health. Absolutely, I think 423 00:23:34,000 --> 00:23:37,600 Speaker 1: it really lays bare the class of which you belong 424 00:23:37,680 --> 00:23:41,760 Speaker 1: to in society. It's really hard to give one example 425 00:23:41,840 --> 00:23:45,359 Speaker 1: that cuts across all countries, because there's a nuance to 426 00:23:45,560 --> 00:23:49,879 Speaker 1: every country's retirement system. No two really are the same. 427 00:23:50,480 --> 00:23:53,879 Speaker 1: There is, of course a push in many developed countries 428 00:23:54,240 --> 00:23:57,439 Speaker 1: to come up with a private saving system that's different 429 00:23:57,440 --> 00:24:00,720 Speaker 1: to a government to find benefits scheme. So in Australian 430 00:24:00,760 --> 00:24:03,119 Speaker 1: New Zealand, the region we're speaking to you from today. 431 00:24:03,200 --> 00:24:05,560 Speaker 1: That is what happens, and it's a percentage of your 432 00:24:05,600 --> 00:24:10,080 Speaker 1: salary that your employer must put away into savings. But 433 00:24:10,280 --> 00:24:13,399 Speaker 1: given it's a percentage of your salary, that means that 434 00:24:13,440 --> 00:24:15,560 Speaker 1: if you work in a higher paying job, of course 435 00:24:15,640 --> 00:24:18,840 Speaker 1: at the other end, you will have more money. And 436 00:24:18,960 --> 00:24:22,359 Speaker 1: so therefore there's kind of this in built problem with 437 00:24:22,440 --> 00:24:25,400 Speaker 1: the system. And we also know that you know there's 438 00:24:25,400 --> 00:24:27,320 Speaker 1: a there's a guaranteed amount that you have to put away, 439 00:24:27,320 --> 00:24:30,920 Speaker 1: but some workplaces offer you know, as much as five 440 00:24:30,960 --> 00:24:34,119 Speaker 1: percent over that guaranteed amount in a way to lure 441 00:24:34,440 --> 00:24:37,439 Speaker 1: good employees. So if you're highly educated, you might be 442 00:24:37,480 --> 00:24:40,240 Speaker 1: in line to get a fifteen percent of your salary 443 00:24:40,520 --> 00:24:43,040 Speaker 1: put away that's then invested for you by a large 444 00:24:43,080 --> 00:24:45,720 Speaker 1: fund over time, and that wealth grows, so when you 445 00:24:46,119 --> 00:24:47,959 Speaker 1: reach for a time and age, you'll you won't need 446 00:24:48,000 --> 00:24:51,240 Speaker 1: to really worry about the state pension system at all. 447 00:24:51,680 --> 00:24:55,480 Speaker 1: But if you're a transient worker, if you're a healthcare worker, 448 00:24:55,760 --> 00:24:58,240 Speaker 1: maybe if you're a teacher, you know you can have 449 00:24:58,320 --> 00:25:01,080 Speaker 1: secure employment, but you also might not lot and typically 450 00:25:01,119 --> 00:25:04,040 Speaker 1: those jobs are lower paying. So then by virtue, you 451 00:25:04,359 --> 00:25:06,760 Speaker 1: will have a lower savings at the end and become 452 00:25:06,800 --> 00:25:09,919 Speaker 1: more dependent on the public system as a safety in it, 453 00:25:10,560 --> 00:25:14,520 Speaker 1: and then that in built discrimination can occur. And that's 454 00:25:14,680 --> 00:25:17,000 Speaker 1: part of a big debate in the developed world at 455 00:25:17,000 --> 00:25:20,320 Speaker 1: the moment is how women are treated in that system. 456 00:25:20,359 --> 00:25:23,680 Speaker 1: If women work part time, of course, that impacts your 457 00:25:23,840 --> 00:25:26,919 Speaker 1: private savings. And also you know, if you if you're 458 00:25:26,920 --> 00:25:29,359 Speaker 1: a casual worker, for example, and you work multiple jobs, 459 00:25:29,359 --> 00:25:31,639 Speaker 1: how do you build up a proper nest egg. And 460 00:25:31,680 --> 00:25:34,520 Speaker 1: there's various reforms that have happened here and elsewhere to 461 00:25:34,560 --> 00:25:36,560 Speaker 1: try and fix those issues, but it still is a 462 00:25:36,600 --> 00:25:39,720 Speaker 1: glaring gap in the system. I think. For me, one 463 00:25:39,760 --> 00:25:42,400 Speaker 1: of the really startling things that I guess I hadn't 464 00:25:42,400 --> 00:25:44,960 Speaker 1: really thought about was how much people who are in 465 00:25:45,080 --> 00:25:51,200 Speaker 1: particularly physical jobs are discriminated against when the retirement age rises. 466 00:25:51,920 --> 00:25:54,600 Speaker 1: Often it's difficult to keep up a really physical job 467 00:25:54,720 --> 00:25:58,199 Speaker 1: into your sexties, especially into your late sixties, and so 468 00:25:58,320 --> 00:26:01,000 Speaker 1: that means those people have to go on either unemployment 469 00:26:01,000 --> 00:26:05,520 Speaker 1: benefits or health benefits which are lower than pensions, and 470 00:26:05,600 --> 00:26:08,800 Speaker 1: so it increases poverty and old age, which is very 471 00:26:08,840 --> 00:26:11,600 Speaker 1: difficult for people. There was a study by the i 472 00:26:11,840 --> 00:26:14,040 Speaker 1: f S in the UK, and it looked at the 473 00:26:14,119 --> 00:26:16,480 Speaker 1: retirement age which was raised by one year in the 474 00:26:16,560 --> 00:26:20,119 Speaker 1: UK to sixty six, and that made a difference of 475 00:26:20,200 --> 00:26:23,199 Speaker 1: doubling the poverty rates of sixty five year olds. So 476 00:26:23,240 --> 00:26:26,720 Speaker 1: it's quite startling when that happens. I think, raising the 477 00:26:26,800 --> 00:26:29,480 Speaker 1: return in age by one year double the poverty rate. 478 00:26:29,520 --> 00:26:32,760 Speaker 1: How did that happen? Because the people who would have 479 00:26:32,920 --> 00:26:35,520 Speaker 1: got their pensions and who were unable to work instead 480 00:26:35,560 --> 00:26:38,000 Speaker 1: had to go on the unemployment benefit or health benefits, 481 00:26:38,280 --> 00:26:40,800 Speaker 1: and they are lower than the pension benefits, and so 482 00:26:40,880 --> 00:26:44,040 Speaker 1: they were pushed into old age poverty. Whereas I would 483 00:26:44,040 --> 00:26:46,879 Speaker 1: also say that from talking to people who study this 484 00:26:47,080 --> 00:26:49,720 Speaker 1: phenomenon globally and a lot of demographers are looking at 485 00:26:49,800 --> 00:26:53,520 Speaker 1: at this kind of thing being employed in your early sixties. 486 00:26:53,560 --> 00:26:55,480 Speaker 1: I mean, if you already have a secure job and 487 00:26:55,560 --> 00:26:58,280 Speaker 1: you're working behind a desk, then it's kind of easy 488 00:26:58,359 --> 00:27:01,080 Speaker 1: just to stay in that job and just push, you know, 489 00:27:01,160 --> 00:27:04,840 Speaker 1: you might even push beyond the retirement age. But if 490 00:27:04,880 --> 00:27:07,919 Speaker 1: you're somebody who's been in different types of work, or 491 00:27:08,160 --> 00:27:10,879 Speaker 1: you're exiting the workforce and then have to you know, 492 00:27:10,920 --> 00:27:14,320 Speaker 1: you have to change jobs for whatever reason. What lobby 493 00:27:14,320 --> 00:27:17,359 Speaker 1: groups say Advocates says that there's still a huge amount 494 00:27:17,359 --> 00:27:20,120 Speaker 1: of discrimination against older workers. So if you're sixty five, 495 00:27:20,160 --> 00:27:22,800 Speaker 1: for example, applying for a job, what are your prospects 496 00:27:23,080 --> 00:27:25,920 Speaker 1: against somebody who might be ten, twenty thirty years younger 497 00:27:25,960 --> 00:27:29,200 Speaker 1: than you, And that that is where the playing field 498 00:27:29,240 --> 00:27:31,919 Speaker 1: is really not level at all, because if you are 499 00:27:32,040 --> 00:27:34,840 Speaker 1: job hunting at that age, there needs to be a 500 00:27:34,880 --> 00:27:37,720 Speaker 1: mindset shift from employeers as well to make sure that 501 00:27:37,760 --> 00:27:41,080 Speaker 1: they give those opportunities to older workers as well. And Amy, 502 00:27:41,119 --> 00:27:42,560 Speaker 1: I think some of the things you have been looking 503 00:27:42,560 --> 00:27:45,840 Speaker 1: at is really going into how the pension age being 504 00:27:46,040 --> 00:27:50,359 Speaker 1: raised does discriminate against particular groups of people. There is 505 00:27:50,359 --> 00:27:53,320 Speaker 1: a court case that's being heard and it's looking at 506 00:27:53,359 --> 00:27:57,639 Speaker 1: this idea that Indigenous people in Australia live around about 507 00:27:57,920 --> 00:28:01,879 Speaker 1: eight years less than non Indigenous people in Australia, and 508 00:28:02,119 --> 00:28:05,360 Speaker 1: therefore they should be able to access the age pension earlier. 509 00:28:05,720 --> 00:28:07,600 Speaker 1: Exactly how much earlier, we don't know. That would be 510 00:28:07,640 --> 00:28:09,240 Speaker 1: up to the court to decide. But I think it's 511 00:28:09,240 --> 00:28:14,240 Speaker 1: a really interesting example of trying to challenge a system 512 00:28:14,320 --> 00:28:17,879 Speaker 1: that one size fits all really just doesn't work for everybody. 513 00:28:18,280 --> 00:28:20,280 Speaker 1: When you look down the road in a few years 514 00:28:20,320 --> 00:28:23,840 Speaker 1: when the bills start to come do how will this 515 00:28:23,960 --> 00:28:26,719 Speaker 1: be paid for? The best description I've heard of it is, 516 00:28:26,840 --> 00:28:29,960 Speaker 1: you know, this is a slow moving financial crisis, probably 517 00:28:30,000 --> 00:28:33,320 Speaker 1: the slowest we have ever seen, because you know, it's 518 00:28:33,320 --> 00:28:35,960 Speaker 1: not some dramatic thing that's going to happen and be 519 00:28:36,040 --> 00:28:37,919 Speaker 1: done with and there'll be a solution in you know, 520 00:28:38,000 --> 00:28:41,080 Speaker 1: one month, two months, a year. This is building up 521 00:28:41,080 --> 00:28:45,640 Speaker 1: to an incredible pressure point and at some point the 522 00:28:45,680 --> 00:28:47,880 Speaker 1: needle is going to have to be grasped. At some point, 523 00:28:47,960 --> 00:28:50,280 Speaker 1: something is going to have to be done. But whether 524 00:28:50,320 --> 00:28:53,960 Speaker 1: we're there yet or not is I think probably not. 525 00:28:54,160 --> 00:28:56,800 Speaker 1: I think, you know, the likelihood is this problem will 526 00:28:56,800 --> 00:28:59,680 Speaker 1: we continue to kick down the road a little bit 527 00:28:59,680 --> 00:29:03,000 Speaker 1: further until it really does come to a point. I mean, 528 00:29:03,400 --> 00:29:06,320 Speaker 1: you know, morbidly. The only thing that might stop this 529 00:29:06,400 --> 00:29:10,440 Speaker 1: becoming such an intractable problem is if the increases in 530 00:29:10,480 --> 00:29:14,120 Speaker 1: life expectancy do really slow down, if the increases in 531 00:29:14,160 --> 00:29:17,080 Speaker 1: life expectancy to go into reverse. But that would be 532 00:29:17,120 --> 00:29:20,600 Speaker 1: absolutely nothing to celebrate. The extension of life expectancy has 533 00:29:20,640 --> 00:29:23,480 Speaker 1: been one of the big successes of this century. And 534 00:29:23,680 --> 00:29:26,000 Speaker 1: you know, the idea that anything like that would have 535 00:29:26,040 --> 00:29:28,960 Speaker 1: to be endangered. To solve this is not answer I 536 00:29:28,960 --> 00:29:31,640 Speaker 1: think anybody on any side of the political aisle wants 537 00:29:32,480 --> 00:29:36,479 Speaker 1: any day. Bridge, Ansley Thompson, Emily Kadman, thanks so much 538 00:29:36,520 --> 00:29:39,400 Speaker 1: for joining me today. Thank you, Wes, Yeah, thank you 539 00:29:39,480 --> 00:29:44,240 Speaker 1: with It's a pleasures. Thank you. Thanks for listening to 540 00:29:44,320 --> 00:29:46,480 Speaker 1: us here at The Big Take. It's a daily podcast 541 00:29:46,520 --> 00:29:49,480 Speaker 1: from Bloomberg and I Heeart Radio. For more shows from 542 00:29:49,480 --> 00:29:53,080 Speaker 1: my Heart Radio, visit the i Heart Radio app, Apple podcast, 543 00:29:53,240 --> 00:29:55,920 Speaker 1: or wherever you listen, and we'd love to hear from you. 544 00:29:56,280 --> 00:29:59,920 Speaker 1: Email us questions or comments to Big Take at Bloomberg 545 00:30:00,000 --> 00:30:03,920 Speaker 1: dot net. The supervising producer of The Big Take is 546 00:30:04,080 --> 00:30:09,160 Speaker 1: Vicky Virgolina. Our senior producer is Katherine Fink. Our producer 547 00:30:09,240 --> 00:30:14,360 Speaker 1: is Rebecca Chasson. Our associate producer is Sam Gebauer. Philde 548 00:30:14,400 --> 00:30:18,240 Speaker 1: Garcia is our engineer and our original music was composed 549 00:30:18,240 --> 00:30:22,440 Speaker 1: by Leo Sidrin. I'm West Cassova. We'll be back tomorrow 550 00:30:22,480 --> 00:30:23,680 Speaker 1: with another Big Take.