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New Social Challenge.
The long term short term frisson, I wrote about yesterday affects many and unexpected parts of daily life.
Over the last 30 years there has been a trend away from pensions “by decree” to pensions “down to you”. “By decree” meant employers were required, expected to provide well managed employee pensions.
This was expensive for the company. Gradually the fashion was towards smaller government, less state decrees, greater choice for all and so the responsibiilty for pensions was passed to the individual.
But individuals find it difficult to manage their own affairs. Children need educational support, someone goes sick, there are employment challenges. In many cases people left to themselves know little about finance and manage their funds badly.
So what may have once looked like a robust and pragmatic decision for the new self reliant American, now looks more llike a brutally insensitive abrogation of social responsibility. and it is creating a time bomb.
Today the United States is witnessing a dangerous growth in Baby Boomer bancruptcy. More than 60% of this group of families are in debt, and bancruptcy rates are up 10 fold.
Desperate poverty amongst the elderly is going to be one of our most intractable challenges.
Have a good day.