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Comment by behringer | Hacker News Reader

That's a great short term solution, but then what do you do with society's old people? We still haven't yet seen what's about to happen with the destruction of pensions in the US.

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Germany will probably find out soon...

How so? Germany's population is aging, but they're also importing immigrants like there's no tomorrow to ballance things out.

It will take two or three generations before they make (enough) money to pay for the "high pensions" of old Germans... And even we get a ton of new people. The old generations are still more.. M

For someone not familiar with the German situation, do you have some article or other details to clarify?

The same thing as the thousands of years prior to pensions?

Which one? Have a dozen children so that you have plenty of people to take care of you in your old age, or die impoverished?

Either? Dozen children is hyperbole, but 3 to 5 children, as well as an extended family for support. But it takes a lot of sacrifice to achieve, which no younger person I know of is interested in.

One can also plan to off themselves once they're unable to support themselves. I say plan, because I'm sure saying it is easy, but when it comes time to do it, it'll be much more difficult.

3 - 5 kids is not a solution to the problem, it's a pyramid scheme of ever expanding population that stops as soon as population growth stops, an I don't know if you noticed, but we've hit 8 billion, so it's no longer an option.

Also, what is this sacrifice you are talking about? Just another one "kids these days!"

> But it takes a lot of sacrifice to achieve, which no younger person I know of is interested in

I almost involuntarily typed "OK Boomer" in response to that.

*I'm Gen X, not a Millenial, but still

I’m also in the younger generation, but we are choosing to live in more expensive cities and being further educated and prioritizing high incomes as opposed to starting to have kids at a younger age. There is no value judgment here about the choices, but I would consider it a sacrifice to give up partying in one’s 20s to raise a family capable and willing to support you. Of course, it may also not be a good choice since earning power of those who have children in younger 20s might be greatly reduced.

One of the big reasons cities are more expensive is that a lot of Americans use their house as a savings plan, causing society to prioritize things that keep property values stable or increasing.

We can't simultaneously have ever-rising property values and affordable housing. Without affordable housing, many people are choosing to defer having kids (including, as you say, by pursuing more education to get higher-paying jobs), which reduces the worker/retiree ratio. That in turn makes it more expensive to be old, requiring more yet more savings.

To me a lot of this problem like a pathological response to the US's lack of good long-term pension coverage. Our every-man-for-himself, devil-take-the-hindmost approach causes a lot of scarcity thinking, which makes it hard to adopt sensible systemic solutions.

Maybe one reason. But I think the biggest reason is that technology and globalization have caused more and more jobs to move to big cities, and in particular to cities on the east and west coast (in the US), which results in housing scarcity due to demand exceeding supply. This is the case in the city where I live. Due to a booming tech industry, the influx of people moving to the city exceeds the amount of housing that can be built (along with other infrastructure, like roads).

And it isn't a problem in all cities either. From what I hear costs are going down in many industrial cities as residents leave to seek more abundent jobs elsewhere.

Sure, but the question is: why hasn't housing supply kept up? I'd say it's because there are strong political incentives to avoid doing anything that might cause prices to go down. So we end up with very restrictive zoning and a ton of inertia. This is very obvious in all the Silicon Valley suburbs, where everybody loves job growth but housing growth barely happens.

As to the latter point, I'd be interested to see your data. The Case-Shiller metro indexes are all up over the last 5 years. [1] The metro area with the least inflation is New York, which doesn't match.

[1] https://us.spindices.com/additional-reports/all-returns/inde...

Cities in the US are more expensive due to housing policy, as you mention, but also because cities as the engine of American business and growth are subsidizing the rest of the nation. A significant chunk of every city dweller's money ends up in taxes that are transferred to far less efficient and less wealthy non city areas.

Take away the wealth transfer from cities to non urban areas and the only people living in rural areas will be the wealthiest and end of the world preppers.

People are prioritizing expensive cities because that's how you get higher income. You get higher income by being educated. And you need higher income to raise kids because raising kids is incredibly expensive especially if you don't have a higher income job's provided healthcare.

This has absolutely nothing to do with partying. And if you're choosing to have kids for the purpose of having a support network when you're older, that's kind of a fucked up rationalization for it. At that point, society has failed you somewhere along the way. Even ancient societies had other methods of supporting the elderly in the community or through some form of welfare.

Who would take care of someone else like they would their own parents? And you can do things for multiple purposes. Children and family provide a valuable support network to get you through life, but it can also be because you want to raise kids to be good stewards of society and all that Jazz.

Hypothetically.. if one were an unattractive misanthrope with low sperm count.. what procreation strategy would you recommend to maximise my comfort in old age? Off the top of my head, I'm thinking I should adopt at least 7 Vietnamese orphans.. I won't be able to provide them more than a community college education, and I will undoubtedly imbue them with emotional problems as well.. so 7 sounds like a safe number to perhaps end up with 1 or 2 more resilient ones that will be able to manage my care...

And then presumably your children need to have 3-5 children each, and their children have 3-5 children each, ad infinitum?

So, given these 3 options:

1. Save money.

2. Have 3-5 kids.

3. Kill yourself.

What I’m hearing is that you prefer 2 & 3?

It’s impossible for 99% of people to save enough money to buy the kind of care your children would provide you. Not even considering how well someone would tend to wiping your butt, but the emotional benefits of being surrounded by family are probably not able to be replicated.

It's also a great incentive to not alienate your children.

Societies did one of the following:

1. Had the government or community take care of the elderly.

2. Criminalize poverty and force them to work or be imprisoned.

3. Let them die.

Even the Roman Empire had pension for people that served in the military. You can take your pick as to which system you'd prefer, but pensions have quite literally existed for thousands of years in some form.

4. Personal saving / investing. 5. Lean on family (super common, even in several non-American societies today)

It’s disingenuous to assert that the alternative to no pension is blood in the streets.

And what happens when the economy goes bust when you're running down your investment in your retirement years? Or if you can't invest or save due to the many rent-seeking behaviors we see nowadays? Do we just let them die because they had the misfortune of bad timing or being take advantage of?

For 5: Even in those non-American societies they have recognized that leaning 100% on your family is generally a bad thing for working professionals. Or at least those companies are not willing to pay for their employees to take care of their elderly or disabled family members.

Exact same thing happens to pension funds, though. They're somewhat insulated due to size, but they are no less susceptible to large market changes.

A pension is a personal savings. Back when pensions were actually offered by companies, you'd often choose your company by not just your paycheck, but by the retirement plan they offer. You would literally turn down jobs that might pay better but offer no pension. If that's not saving your money, then what is?

Because pensions aren’t portable. They lock you into a particular organization. 401k, stocks, savings accounts, etc, do not. Pensions (in the private sector, public ones are another ball of wax entirely) do not protect you against inflation. You have no control over what they’re invested in (which in some cases, is the pension manager’s retirement). There are much better options available.

You can move pensions and you can sack the manager and replace them as one of the biggest UK DB ones has done

I think the USA going to soon learn the ugly truth about your item 4: that massive swaths of the population have not saved adequately. I mean, I make pretty ok money and save the max every year, but there is no way on earth my pathetic 401k is going to last even 10 years after I stop working. Now consider the average American who has fuck-all in their retirement account. Despite their disadvantages, pensions at least let people who didn’t save retire in (perhaps difficult) dignity. When my account says $1 and I have no other living breadwinners in my family, my only remaining retirement option is to spend that last dollar on a bullet.

I'm pretty sure that and our 2-3x inflation annual increases in our already-insanely-high healthcare spending are going to lead to civil unrest in the next 30-40 years. On the shorter side for the healthcare spending (no way we can keep up the current rate of increases even 20 more years without an actual, honest-to-god revolt) and somewhat later for the failing retirement system (such as it is). I'm a lot more worried about those than climate change, which we are for-sure not going to address anyway if those aren't dealt with.

>(no way we can keep up the current rate of increases even 20 more years without an actual, honest-to-god revolt

Why would you assume the rate of increase would keep increasing at the same rate?

Rate at which the spending is increasing, that is, not rate at which the rate of increase is increasing.

That's what I meant. Why would you assume it would keep increasing at the same rate. Nothing maintains a steady growth rate long term.

If long term's just another 20 years, at the outside, that'll be enough. Short of lots more people getting sick and dying or living with chronic illness, untreated (so, not generating medical bills, and see also: civil unrest), I don't see what's going to slow it down in that time frame. I think effective legislation, which could theoretically do it, isn't likely for at least another 10 years or so if we're lucky. If it takes longer than that, well, I just hope the rioters blame the correct things/people for their problems. And hopefully the retirement crisis hasn't reached first-page-story status by that time yet, either, or it'll really be a mess. I suspect that one will hold off a bit longer, though. Pretty sure mid- to late-Gen-X folks will be the ones who make that one pick up the pace, especially if inheritance amounts have been trending significantly down for those same folks due to EOL healthcare bills for their parents.

So yeah, I agree it won't maintain a steady growth rate in the long term. I just don't think it'll stop before it causes some pretty big problems.

[EDIT] incidentally I'm not aware of high-profile projections of this stuff that have HC costs doing anything but continuing up way faster than inflation through at least 2030, provided the regulatory environment remains fairly similar. Even Warren's plan isn't projected to do much about that—need price controls in one form or another (like AFAIK every other OECD state uses) and a fix for our doctor supply problem, at least, probably, to do much about the rising costs.

Look at healthcare as a percentage of gdp over the last 50 years. Costs have been rising at a much slower rate over the last 10 years, and have dropped over the last 3. There's no reason to think the rate will stay constant over 20 years.

If anything naive extrapolating shows falling costs as a percentage of GDP, and sustainable rising real costs.

The only way we get crazy numbers is extrapolating using the average from 2000-2020, but there's no reason to do that.

https://www.statista.com/statistics/184968/us-health-expendi...

Why would you criticise his extrapolation without offering a well-justified alternative?

Because naive extrapolation based on current growth rate is almost always a bad idea.

I understand that, but if you are going to criticise him (?), you should suggest whatever it is you deem appropriate. Then it's going to be constructive.

If you are not going to make the effort, why should he take your criticism seriously?

There's nothing appropriate to suggest. Predicting the rate at which health insurance costs are going to rise over the next 20 years is impossible.

I can however tell you that naive extrapolation is definitely the wrong way to do it.

Look at the 2nd derivative it's all over the place, so assuming that it will magically stay constant is wrong. The 2nd derivative of healthcare as a percentage of GDP is actually negative over the last few years.

Not arguing about the US being about to learn this the hard way. But when we get to that point, neither a pension nor a 401k will be able to save anyone.

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