A perpetual cause of astonishment among commentators and the general public is government inaction in the face of signs clearly legible to everyone that action is needed. Case in point: the population crisis – or, as Spa (Jan 25) puts it, “the crisis of super-aging.”
A dwindling birth rate combined with a growing elderly population produces easily calculable results. The population ages at such-and-such a pace, the working population declines and the dependent elderly population rises, with foreseeable strains on the economy and social welfare programs. The signs have been clear since the mid-1980s, says economist Kazumasa Oguro. Little was done, and the crisis proceeded unchecked.
All developed countries are aging, but none as rapidly as Japan. In 2020, 28.8 percent of Japanese were elderly – 65 or over – versus 20 percent in the U.S. and Europe. That’s nothing compared to what’s ahead, says Spa.
In 2025 the youngest of Japan’s baby boom generation turn 75. From 2025 to 2040, the “working-age population” (age 20-64) will fall by about 10 million. “It’s like a tsunami,” says Oguro.
A rising tsunami, he might have said. In 2000 there were 3.6 people of working age per elderly person. By 2050 there will be 1.3. Where will the money come from? Supposing the consumption tax to be the source, calculations show it will have to rise from the current 10 percent to 22 percent by 2040 and 30 percent by 2060. That is, Spa adds, presuming the economy grows at a modest but steady pace of 1 percent per year. Oguro, for one, fears that’s overly optimistic.
It’s a political problem as well as an economic one. The term “silver democracy” sums it up well. Elderly voters want, vote for, and, if their numbers are sufficient, get old-age benefits, explains sociologist Ryosuke Nishida. No wonder, he says, many younger people don’t bother voting. They know in advance that their own declining numbers are an insufficient counterweight. Last year’s Lower House elections drew a voting rate of 56 percent, third lowest postwar. “Not voting is now seen as natural,” says Nishida. One result: programs encouraging childbirth and supporting child-rearing are starved in favor of benefits for the elderly.
Not that needy senior citizens don’t merit benefits. But there’s resentment growing among the young, says Spa – a perception that their elders monopolize most of the national wealth even without benefits. There are figures backing that up. More than 60 percent of the national wealth is in elderly hands. The elderly were, after all, beneficiaries in their prime of a thriving economy. Promotions were seniority- (not merit-) based; wage increases taken for granted. Succeeding generations fared less well. The economic bubble burst in the early 1990s; there followed 20 years and more of economic stagnation, hiring freezes, part-time low-paying jobs for want of anything better. Thus the so-called “lost generation.” Just as things began looking up, along came COVID-19 and the staggering “coronavirus economy.”
It’s now become commonplace to talk of “living to 100.” The government has been pushing measures to keep people working to age 70 and beyond. In 2019 the government’s Financial Services Agency released a report saying an average couple living to age 95 would need 20 million yen in savings to live reasonably well beyond retirement. How to raise that kind of money in these troubled times? The government promptly rejected the report. Evidently it’s still not ready to confront the crisis head-on.© Japan Today