On national credit ratings and national ages
Continuing the evidence that the aging population may put too much of a
strain on first world countries, the Economist reported today that
redit ratings for the worlds' richest countries, nations like the
United States, Japan, Britain, France, and the EU itself, may wind up
in Junk Bond status by 2040 due to rising care costs for the elderly.
The numbers quoted are frightening. If nothing should change, Japan is
predicted to have a national debt 7 times the size of its GDP by
mid-century, and all 25 of the nations on S&P's statistical list
will be at BBB-credit rating, a rating currently applied to such
financial giants as Poland and Mexico.
The consensus (at least among those party to the study) is that
demographic shifts are needed, but more importantly so are pension
re-adjustments, adjustments that can prove very difficult to get
through governments for the simple reason that people do not tend to
vote for the candidate who promises to slash their benefits. Still,
eventually something must be changed, though for the moment, people
seem content to sit around and wait for the need to become greater.