Phil Mullan is an economist. Author of The Imaginary Time Bomb: Why an Ageing Population is not a Social Problem, he has researched, written and lectured on economic, demographic and business issues.
The lie to the existence of an ‘ageing time bomb’ is that populations in developed countries have been ageing at pretty much the same pace over the past 120 years as is projected for the next 30 to 40 years. This long term demographic trend has not stopped us becoming more prosperous – at all ages – pretty much continuously over this period, in contrast to what we could expect from the fatalist warning these days that ageing societies are bound to be slower growing.
The reason is the simple anti-Malthusian one that societies tend to become more productive and therefore wealthier at a much, much faster rate than any increase in the proportion of dependent people that are not able to contribute to that wealth. While the language of ‘burden’ betrays the misanthropic slant in today’s western culture, a key point is that there is no determinate relationship between the pace of ageing and the pace of economic growth. There is therefore no intrinsic age-related constraint on the size of the economic cake to provide the resources to support those elderly that need it. As a society we can afford to grow old, just as we have been able to in the past.
The false assumption that morbidity and old age are inevitably intertwined underpins the idea of a growing and unaffordable burden on health care resources. While some illnesses do rise with age – dementia, for example – the overall trend that this ignores is that we are not just living longer lives but longer healthier lives. Life expectancy and healthy life expectancy are both on the rise and both are success stories that deserve more celebration.
In particular, statistics that show higher shares of health spending devoted to the over-65s are misleading when pessimistic and alarmist conclusions are drawn. This rising share is of course the other side of the smaller share spent on younger age groups, which points to a much more benign explanation. Most of us are getting through more of the earlier stages of life in better health and therefore needing less medical support throughout our lives than did our parents’ and grandparents’ generations. In addition age-related discussions of health costs mislead when they fail to emphasise that the cost of dying is more relevant than the cost of ageing. The greatest demand for health care arises in the last six or 18 months of people’s lives, whenever that is. Given the good news that fewer people now die young, these heavy costs of dying must show up in ‘old age’ health spending because we all die sometime.