Synopses & Reviews
The year 2008 marks the beginning of the baby boomer retirement avalanche just as the different demographics in advanced and most developing countries are becoming more pronounced. People are worrying again that developments in global population trends, food supply, natural resource availability and climate change raise the question as to whether Malthus was right after all.
The Age of Aging explores a unique phenomenon for mankind and, therefore, one that takes us into uncharted territory. Low birth rates and rising life expectancy are leading to rapid aging and a stagnation or fall in the number of people of working age in Western societies. Japan is in pole position but will be joined soon by other Western countries, and some emerging markets including China. The book examines the economic effects of aging, the main proposals for addressing the implications, and how aging societies will affect family and social structures, and the type of environment in which the baby-boomers' children will grow up.
The contrast between the expected old age bulge in Western nations and the youth bulge in developing countries has important implications for globalization, and for immigration in Western countries - two topics already characterized by rising discontent or opposition. But we have to find ways of making both globalization and immigration work for all, for fear that failure may lead us down much darker paths. Aging also brings new challenges for the world to address in two sensitive areas, the politicization of religion and the management of international security. Governments and global institutions will have to take greater responsibilities to ensure that public policy responses are appropriate and measured.
The challenges arising within aging societies, and the demographic contrasts between Western and developing countries make for a fractious world - one that is line with the much-debated 'decline of the West'. The book doesn't flinch from recognizing the ways in which this could become more visible, but also asserts that we can address demographic change effectively if governments and strengthened international institutions are permitted a larger role in managing change.
"...interesting and far-reaching book"(Spectator Business, November 2008)
“A very readable analysis of the broad-ranging consequences of demographic trends, supplemented by quickly grasped charts and tables.” (Choice
, April 2009)
Recent developments in global population trends characterized by low birth rates and rising life expectancy are leading to a graying population worldwide. Aging is bound to have pervasive effects on economic growth, inflation, house and equity prices, public spending and taxation, education and healthcare provision, and wealth distribution. (BCC Orient, Sep 08)
Macbeth tells Seyton of many things that should accompany old age, such as ‘honour, love, obedience, troops of friends’ but, on a practical note, he concedes that he would look to have, in their stead, ‘curses, not loud but deep.’ Perhaps, the ‘curse’ for today’s old threatens to come in the form of financial anguish they’d leave behind for the middle-aged ‘baby boomers’ marching in legions towards retirement, and their descendents, as a new book on ‘how demographics are changing the global economy and our world’ highlights. (The Hindu, 29/9/2008)
Now according to George Magnus, the senior economic adviser to Swiss bank UBS and the author of a newly published book called The Age of Aging, something similar may be about to happen in Europe and to a lesser extent in the US. (South China Morning Post, 23/10/2008)
OLDER job seekers, rejoice. An urban economy like Singapore
will find it easier than rural societies to rehire older workers, says economist George Magnus. It is different in China, where 60 per cent of the people live in the countryside. Rural labour is physical lnd tough, so he says it is very hard to raise the participation of older workers aged 55 to 65. Typically, ageing countries turn to older workers, women and immigrants to replenish their shrinking labour pools. (The Straits Times, 25/10/2008)
Mr George Magnus easily discerns the "perverse' pluses" of the financial upheaval of the world, having scanned economic horizons for 30 years. The economist thinks the crisis is good for the ageing world. He is pleased the crisis will compel the West to move away from its culture of debt, and start to save more instead. "For ageing societies, that's a good thing because too many people have too few savings and too little preparation for retirement," he tells Insight. (The Straits Times, 25/10/2008)
Author's Article Contribution: The financial crisis has already been tagged the worst since the banking collapse of the 1930s. Eventually, the sense of crisis will end, as governments and regulators become interventionist and try to contain the worst effects of the "de-leveraging; which will plunge the global economy into a recession over the next few quarters. That, too, will end. (Personal Money, Nov '08)
Rising life expectancy and low birth rates continue to be an issue for countries like Singapore and Japan. As the trend in graying population foreshadows huge impact in economic growth and healthcare provision, author George Magnus explores the economic issues, consequences and possible solutions to this phenomenon. (Smart Investor, Nov '08)
In his spare time, George Magnus, senior economic adviser at UBS (prior to moving to a part-time role he was the bank's chief economist), has written arguably the most comprehensive book to date on aging. The timing is perfect - 2008 is the beginning of the baby boomer retirement era, which is going to markedly change the face of global workforces. (Finance Asia, Nov '08)
Rising life expectancy and low birth rates continue to be an issue for countries like Singapore and Japan. As the trend in graying population foreshadows huge impact in economic growth and healthcare provision, author George Magnus explores the economic issues, consequences and possible solutions to this phenomenon. A senior economic adviser at UBS Investment Bank since 2005, Magnus banks on his extensive research background on the economic consequences of demographic changes. (Smart Investor, 1/11/2008)
Last week, we asked readers if they agreed with economist George Magnus' views on ageing. We also wanted to know how Singapore could do better in valuing and rehiring older workers. Here are some views: "It is never a level playing field in the open job market for older workers. Taking a cue from the handicapping system of golf, the Government's intervention is crucial in setting up an equitable framework, or even enacting statutes to maintain social order, in this creeping serious problem. (The Straits Times, 1/11/2008)
Low birth rates and rising life expectancy are leading to rapid aging and a decline in working age population in the West. Japan has already been in that position for over two decades and will be joined soon by other Western countries. This book examines the economic effects of aging, how aging societies will affect family and social structures, and the implications of what the author calls ‘long families’ rather than the erstwhile ‘wide families’. (Money Life, 6/11/2008)
I suggest two recent books not on the bestseller shelves: A Splendid Exchange: How Trade Shaped the World, by William J. Bernstein (Atlantic Monthly Press) and The Age of Aging, by George Magnus (Wiley). Trade routes and the people and goods traveling them have steered civilization. Birth rates and life expectancies, nation to nation, similarly alter global affairs: determining who and what will support whom in the future. The authors, a financial historian and a business economist, bring enlightenment in a dizzying age. (Forbes Asia, 10/11/2008)
Populations the world over are aging, with some countries aging more slowly than others. As countries enter the third stage of aging, rising longevity and low or declining fertility rates combine to make societies older. This is one of the many conclusions made by George Magnus, the author of 'The Age of Aging', who looks at how this situation will result in shrinking numbers of working-age people on a stable or declining workforce. (Business Today, Dec 2008)
Demography is the senior social science: churchgoers this week will be reminded that Jesus Christ was born in the midst of a census two millennia ago. George Magnus's The Age of Aging is an account of the great population transitions currently under way around the world. Magnus is a renowned City of London economist, now at UBS, and his new book is a guide for the general reader on how the greying of the world will change everything, everywhere. (Financial Times, 22/12/08)
Every age has its big demographic scares. In 1798, when the world’s population was about 1 billion, Thomas Malthus published his “Essay on the Principle of Population”, predicting that, thanks to mankind’s enthusiastic procreation habits, by the middle of the 19th century there would no longer be enough food to go round. In the event, people happily continued both to multiply and to eat. (The Economist, 30/12/08)
George Magnus' name has recently gained high recognition in the global economy. As senior economic advisor at UBS, he gave forewarning of the impending financial crisis to the US in an essay published March of last year. Since then, he has become one of the most sought after economic analysts of our age. (Grandeur (Chinese magazine), January 09)
It wasn't long ago that all of us were Malthusians, worrying about the human population eating through the planet's resources like locusts. George Magnus, senior economic adviser at UBS Investment Bank, warns us in a new book that opposite scenario is the truly frightening one: the human race is getting too old, especially in countries as Japan and China. (POWER, February 09)
The financial equivalent of the Malthus thesis is that the aging of the global population creates massive financial challenges for governments and societies in providing for this non-working group. The effect of growing longevity and falling birth rates means that the average age of populations increases. This will result, based on current predictions, that in 2050 the world will have about 2 billion people aged over 60, three times as many as today - around 30-40% of the total population in the developed world and 25-30% in the developing world. (Wilmott.com - Satyajit Das' Blog, 03/02/09)
We are facing an age crisis, not just because we are living longer but also because our children will have to bear the burden, yet are singularly ill-equipped to do so. A two-year study commissioned by the Children's Society, for which 35,000 youngsters were interviewed, has concluded that they are less capable than any previous generation. It blames poor education, broken homes and the "excessively individualistic ethos" of contemporary Britain. The lives of children, it says somewhat dubiously, are more difficult now than they were in the past. (Daily Telegraph, 03/02/09)
An in-depth analysis of the economic impact of aging has recently been published by George Magnus, the senior economic advisor at the Swiss UBS investment bank. In "The Age of Aging: How Demographics Are Changing the Global Economy and Our World" (John Wiley and Sons), Magnus starts by commenting that we have no precedents to guide us in this situation of a rapidly aging population. (Zenit News Agency, 01/03/09)
George Magnus, senior economic advisor at UBS and author, has opinions on a wide range of subjects. In recent months, he generated spirited debate with his book about the economic impact of aging populations. (Financial Times, Alphaville, 03/03/09)
Last November 3, Josephine Moulds wrote an article in the UK Daily Telegraph about George Magnus, senior economic adviser to Swiss bank UBS, who is widely acknowledged to have predicted that the US sub-prime mortgage crisis would trigger a global recession. (The Manila Times, 04/03/09)
For the 17 million people who are 50 or over, the ability of employers under the law to enforce retirement at 65 is a serious problem, especially given the impact of the economic crisis on the value of retirement savings. Add to this the fact that unemployment figures due this week are expected to confirm job losses rising fastest among older workers, and we see how vulnerable this group has become. (Guardian.co.uk, 17/03/09)
“…interesting and far-reaching book”. (Spectator Business & www.spectator.co.uk/business, Nov '08)
“Magnus’s account avoids the hysteria that often affects this genre…It is well-researched and thorough.” (Financial Times , 22/12/2008)
“…provides a clear, sober and well-written analysis of the problem, both in developed and developing countries…” (The Economist , 3/1/2009)
“Magnus's book is a welcome attempt to address the problems of ageing societies... is informative and well written." (New Statesman , 22/1/2009)
“…intensely readable, utterly disturbing and optimistically redemptive book…his style is authoritative but amenable.” (On Target , Jan '09)
“George Magnus has methodically set out an economist’s view of how societies may adapt…suggests ways in which societies can adjust”. (Financial World , Feb '09)
“…well received book…explores a phenomenon with which the world has never had to deal and whose implications are not fully understood.” (Daily Telegraph & Telegraph.co.uk, 2/2/2009)
We are facing an age crisis, not just because we are living longer but also because our children will have to bear the burden, yet are singularly ill-equipped to do so. A two-year study commissioned by the Children's Society, for which 35,000 youngsters were interviewed, has concluded that they are less capable than any previous generation. It blames poor education, broken homes and the "excessively individualistic ethos" of contemporary Britain. The lives of children, it says somewhat dubiously, are more difficult now than they were in the past. (Daily Telegraph , 3/2/2009)
The Age of Aging
explores a unique phenomenon in the history of mankind, and therefore, one which is taking us all into uncharted territory. The combination of low or declining birth rates and rising life expectancy is producing rapid aging of the world’s population and stagnation in the number of people of working age in Western societies. Aging is most obvious in Japan and will soon become more visible in other Western countries and some emerging markets including China, though most poorer countries will not really encounter more severe aging issues for another 20 years. George Magnus examines the broad economic effects of aging, the main proposals for addressing the implications, and how aging societies will affect family and social structures, and the type of environment in which the baby-boomers’ children will grow up.
The contrast between the expected old age bulge in Western nations and the youth bulge in developing countries has important implications for globalization and for immigration in Western countries—two topics already characterized by rising discontent or opposition. Aging issues are also bringing new challenges for the world to address in two sensitive areas, the politicization of religion and the management of international security.
George Magnus asserts that the challenges arising from aging societies will probably not be addressed effectively unless governments assume larger economic and social involvement and responsibilities. He also argues that the global implications of demographic change, along with those of parallel concerns, such as climate change and resource scarcity, will require a more substantial role to be played by strengthened international institutions.
The extension of human life expectancy is a great blessing. But, together with declining fertility rates, it creates no less big challenges. In this wide-ranging and well-informed book, George Magnus analyzes what needs to be done to lift the burdens created by aging populations.
–Martin Wolf, Chief Economics Commentator, Financial Times
It is a commonplace that, as the population of the developed world ages, there will be all kinds of profound changes in the way the world works. No one to date, however, has sat down and tried to think harder about the ramifications of increased life expectancy and smaller family size than George Magnus. Bringing to the subject decades of work as one of the City’s best respected economists, Magnus shows himself here to be more than just a shrewd analyst of social and economic trends. He writes with clarity and panache, and leaves the reader feeling almost sorry for the “Boomerangst” generation that is fated to support the prolonged retirements of the Boomers themselves.
–Niall Ferguson, Laurence A. Tisch Professor of History, Harvard University; William Ziegler Professor of Business Administration, Harvard Business School
Demography is boring to most people, except when it comes to their own expected longevity and retirement plans. Demography is, however, destiny for countries. Literally. George Magnus provides a global tour de force of how we got to where we are and where we will be in the years ahead. And most importantly, what policymakers need to do NOW to prepare. In his hands, George makes this subject not only not boring but both enlightening and entertaining. A must read!
–Paul McCulley, Managing Director, Pimco
George Magnus is an author with a magnificent, truly globe-spanning mind—and the rare gift of lucidity, which benefits expert and non-expert readers alike. His book, The Age of Aging provides a powerful guide to humanity’s future.
–Stephan Richter, Editor-in-Chief, The Globalist.com
About the Author
George Magnus is the senior economic adviser at UBS Investment Bank and has held this position since 2005. Before this, he was the bank’s chief economist with effect from the merger between UBS and Swiss Bank Corporation in 1998, leading a team of professional economists to the highest accolades in the Institutional Investor and other industry analyst surveys. His previous responsibilities involved senior macroeconomic and managerial positions in Union Bank of Switzerland, SG Warburg and Bank of America. Mr. Magnus’ research is widely known and respected in the financial services community and the business media in the United States, Asia and Europe. He was one of very few to articulate at the beginning of 2007 that a major credit crunch in the United States and the West was likely, with damaging and long-lasting economic consequences around the world. He lives and works in London, is married, and has four children.
Table of Contents
Chapter 1: Introducing a new age.
Everyone is affected everywhere.
The demographic debate laid bare.
Differing prospects for richer and poorer nations.
Demographics and other global trends.
Chapter 2: Population issues from Jesus Christ to aging and climate change.
Population take-off, Malthus, and Marx.
Fertility debate gathers significance.
Falling fertility, family structures, and modern times.
Climate change, food, oil, and water join the fray.
Food and oil supplies.
Water shortages too?
What happened to the dominant species?
Chapter 3:The age of aging.
Global population changes.
Your world party guestlist.
Three stages of ages.
Aging and dependency.
What about the workers?
Dependency ratios for the old and the young are not comparable.
The demographic dividend for poorer countries.
Chapter 4: The economics of aging—what is tobe done?
How the rich world isaging.
Will labor shortage scrimp growth?
Is it possible to boost the supply of workers?
Raising participation and immigration.
Women to work.
Can we strengthen brain as well as brawn?
Working longer to retirement.
Youth trends sap economic strength.
How much immigration?
Productivity is the holy economic grail.
Will we be able to finance retirement?
Saving less with age, saving less anyway.
Changing pension schemes.
Retirement and savings in the United States.
Chapter 5: Coming of age: United States, Japan,and Europe.
Aging in advanced economies.
Accounting for growth in Japan, western Europe, and America.
Removing the sex and age barriers to work Barriers to female employment.
Barriers to older workers in employment.
Later retirement is more than just a matter of law.
A Singaporean model for all?
Who’s for change?
Chapter 6: Will aging damage your wealth?
Will there been enough in the personal savings pot?
Savings patterns and trends in Japan.
Savings in the United States.
Savings in Europe.
Less generous pensions.
More self-reliance for retirement savings.
Government spending and more public debt.
Age-related spending: pensions.
Age-related spending: healthcare.
Age-related spending in OECD countries.
America’s healthcare and public spending explosion.
Paying for aging.
Fiscal versus fallen angels.
Will aging societies inflate or deflate?
Will aging damage your wealth?
Less buoyant returns but new opportunities.
Safe as houses?
Prime-age house buyers in decline:who will buy?
Wealthy and healthy?
Chapter 7: Waiting in the wings: aging in emerging and developing nations.
Aging faster than rich countries.
Demographic dividend and dependency.
Asian strengths and weaknesses.
China—Middle Kingdom, middle age.
Running out of cheap labor.
Growing social policy agenda.
India and its human capital.
An Asian America?
Jobs and skills are what India needs.
Russia—a failing petrostate?
Manpower, military, and immigration.
Africa and the Middle East, banking on the dividend.
Africa: a distorted dividend?
Reasons to be optimistic regardless?
Stronger institutions, too much HIV/AIDS.
Middle East and NorthAfrica—rage, religion, and reform.
Basic population characteristics.
Angry young men in an unstable region.
The need for reform.
Believing, not belonging.
Don’t hold your breath.
Chapter 8: Where globalization and demographics meet.
Globalization is the death of distance.
Solving the globalization problem via institutions.
The globalization “trilemma”.
Globalization and well-being: the case of HIV/AIDS.
For richer, for poorer: marriage by globalization.
Chapter 9: Will immigration solve aging society problems?
Rising hostility toward immigration.
How many immigrants and where are they?
How sustainable is higher immigrant fertility?
Economic arguments are awkward or weak.
Short-run effects positive but may not last.
Unskilled or semiskilled immigration issues.
For some, a brain drain into retirement.
Financial aspects of immigration are balanced.
Competition for migrants may be rising.
Chapter 10: Demographic issues in religion and international security.
The secular-religious pendulum swings back.
The Pyrrhic victory of secular capitalism.
Will religion get us from here to maternity?
Religious belief in the ascendant?
Secular balance can be sustained.
Demographic change and new forms of conflict.
Epilogue: The Boomerangst generation.
The kiss of debt and other sources of angst.
Insecurity, inequality, and changing family structures.
Postscript: Population forecasting.