Ageing populations: Determining YOUR future
The Ageing problem is not simply an Ageing problem. It’s MY problem. Because in 2050 when the silver tsunami hits, I’ll be one of those old women.
Ageing is a problem for countries mainly because of 2 issues
1. Exponentially increasing health care costs ( relative to the average person’s entire lifetime)
2. Inability to be economically active
Below are some of my thoughts off the top of my head. I’m raising it here, not to convince everyone or to campaign for certain things, but more to iron out some of these ideas — are they valid? are they useful? These 2 issues are also NOT comprehensively explored here …. just exploring a different angle.
1. Exponentially increasing health care costs
Medical technologies/treatments are increasingly advanced and costly.
No medical tech/treatment in this world can guarantee you a cure — it’s all about chances of survival.
Eg. Drug A — 20% of patients survive
Drug B — 40% of patients survive
Drug C — 80% of patients survive
No Drugs — 5% of patients survive
When you go on a certain drug, you pay a certain financial cost for the drug, and you enter a system where you have a certain chance of survival
It’s a lottery.
You choose which lottery you want to play, based on the cost, and the chance of your survival.
And bear in mind, the cost doesn’t correlate with the chance of survival.
As a society deciding which lottery costs should be borne by all ( through State subsidies using taxpayer money), we need to decide on the criteria for distributing health subsidies (eg. deciding whether to give more resources to the young or the old? ) It’s not enough that we agree on a set of criteria or values. The ORDER of PRIORITISATION of this common set of values will also significantly change the distribution pattern.
Some criteria I”m thinking of, off the top of my head, in no order of prioritisation (because everyone has a different order anyway)
- absolute cost of the treatment required
- cost effectiveness of the treatment
- age of the person
- economic value of the person
- life expectency of the person
- popularity of the person
- financial health of the person (ie how much can the person afford on his own)
- amount of suffering caused by the illness
- amount of happiness gained without this illness
- political power of the person
- past contributions of the person
- future contributions of the person
- effectiveness of the treatment
- responsibility the person has in acquiring his illness
etc (will add on, with your suggestions, and with more thought into this)
Just to do a little social experiment here:
How much agreement is there amongst the general population, on how we want to prioritise these distribution criteria??
If you would be so kind, do leave YOUR order of prioritsation here in the Comments, and we can take a look. If there are too many criteria, just list the top 5 or top 10.
2. Inability to be economically active
If we assume that, on average, the current ratio of the econ active : inactive is 10: 1 , across all the economically significant nations , and if we assume projections that this ratio will drop to 2:1 by 2050, what would the impact be? That sounds like a 30% unemployment rate to me.
Think about the assets you currently hold. Your property. Your insurance policies. Your stocks etc. What would the value of these assets be if there is 30% unemployment?
Think of your savings. Your salary, your taxes. What happens when there is 30% unemployment?
Am I unduly worried? Is this a valid concern?
Unlike big potential crisises eg. energy shortage crisis, global warming etc, I’ve yet to hear a decent proposal for addressing the Ageing population from anyone. Enforcing the “parents’ maintainance act” is not addressing the problem — it’s re-distributing the problem.
The issue about the state of medical advancement is this: currently we can effectively treat / cure /replace every single body part, except the brain. The reason why we have this Ageing population at all is because we are getting more physically healthier people way into old age. But the mind ages, and degenerates, before the body does. In a knowlege based economy, that’s big trouble.
What we really need is to reduce the number of years between the time people retire from economic activity and death.
Several ways to achieve that:
1. Improve mental cognition of the elderly — this is difficult, we can only place our hope in the neuro scientists out there.
2. Create dignified means of economic viability that do not depend on the mental cognition of the elderly
3. This one will raise the most protests. I’ll just qoute a friend here to illustrate my point :
“i had a friend in college, Pat, who smoked and gave out that i did exercise too much. I said to him, it’s extending my life and those cigarettes are taking years off yours. He said Yeah, but they are the years where i wont be able to poop without help!”
Like this:
15 Responses
Subscribe to comments with RSS.
[...] View original post here: Ageing populations: Determining YOUR future [...]
1. Exponential healthcare cost increase…
I have to disagree on setting a criteria for distribution of healthcare. Our goal has to be universali healthcare. There is no way a society can decide on a distribution criteria like the one you suggested. …and if you distribute it based ability to pay, you end up with the American system which requires complete overhaul. Also, the French healthcare (no.1 in the world) which treat everyone based on their needs shows you can accomplish both universality & adequacy. Singapore should aim higher when it comes to healthcare.
2. Inability to economically active…
Gee when I was young, I dreamt of robots doing all the work while we, humans, sit around and drink good coffee. So sad my govt is telling me to work till I drop….that is why I buy Toto every time the prize money get to 3 million, got to find a way out of this system…
A comment from FB:
I don’t look forward to requiring help to poop.
2050 is about when the silver tsunami _ends_, not begins! (Granted, it will happen later for Singapore than for US/UK/etc.)
You can pretty safely assume that _any_ “redistribution” solutions will be invalidated long before that point. If you’re betting your future well-being on your ability to have a state take the productive outputs of others to spend on your healthcare then you’re likely to be disappointed. Stated another way: assume that by the time 2:1 is a reality, there will be _no_ tax funds available for healthcare.
If you accept my logic, then the rest of your questions about how a state might spend on healthcare during the interim would appear to become irrelevant; I shall strive nonetheless.
Bentham constructed a theory of social utility which had the benefit of facilitating the making of choices by following an agreed procedure, but the problem of replacing the problem of the making of choices with the (more difficult!) problem of making a system to make choices.
One, of several, approaches is the one that you suggest: establish a hierarchy of values and make each choice on the basis of the most important unresolved value. As with Bentham’s work, this provides a simple decision-making procedure but (a) still leaves the intractable problem of determining the priorities and (b) worse, will tend to yield worse results than the usual political horse-trading that goes on (because the procedure gains more legitimacy that the individuals it’s supposed to protect).
Much I’ve suggested before on social structures generally; where there are clear-cut bases for action, adopt them; where choices can be handled directly by individuals they should be; for what little is left, haggle out a compromise.
Unfortunately, an appropriate principled basis for medical care does not appear to exist. This argues, strongly, for removing as much state involvement as possible…
> Think about the assets you currently hold. Your
> property. Your insurance policies. Your stocks etc.
> What would the value of these assets be if there is
> 30% unemployment?
Your house remains valuable (as a nest, not as a nest egg), so long as feasible law and order remains in effect (and, if not, then the entire conversation is moot). A similar theory applies to portfolio allocation; you’re increasingly exposed to healthcare as you age, your portfolio should reflect this. If health-care remains expensive and profitable then you’re fine, if becomes cheap and less profitable then you’re still fine. Of course, if a government interferes and makes it expensive but not profitable, then you’re pretty much stuffed.
> I’ve yet to hear a decent proposal for addressing
> the Ageing population from anyone
This is pretty simple: retirement is a practice that requires immense wealth. Those who don’t have it shouldn’t retire (I certainly don’t intend to), states certainly shouldn’t be helping them!
You’ve already noticed this:
> What we really need is to reduce the number of
> years between the time people retire from economic
> activity and death.
You just missed the simplest, cheapest, most reliable, least harmful, least destabilising way to do it.
Paid retirement is a 20th century invention, not a “natural” part of human life. The industrial revolution is over, affluent societies have neither a baby boom nor (after the financial crisis) the residual spoils of empire to fund retirement, it’s an idea whose time has passed.
I find it hilarious that when I was in JC, our school didn’t let us do Biology with Economics. Their rationale? Only people who were going to Medicine needed to do Biology. To do Medicine, you needed to do the 3 sciences and maths.
As a result, we got many people who had firm grasps of how the body works, and how the planets go round the sun.
But very few people who could balance our finances and keep us healthy.
Of course, that’s no excuse. One of these days, I’ll get around to reading the econs texts that i bought.
I did economics. … got an “A” . They don’t call it a dismal science for nothing….
http://www.sgpolitics.net/?p=3595#more-3595
In response to E-jay’s thoughts:
This is not a rhetorical question, this is a geniune dilema:
Healthcare costs increase exponentially as the average person advances in years.
If the cost of keeping the average person alive beyond the age of 85 is equivalent to the cost of educating 10 average poor children a year, is it fair to make it mandatory for everyone to bear the costs (through health subsidies/insurance using taxpayer money) of keeping those above 85 alive?
In another words. Do people above the age of 85 have a right to live, at the expense of the quality of life of those below the age of 85?
You have brought up an interesting question.
I have another thought about this. If we want to determine our own future, I think we got to consider the following questions and asked ourselves how we want to live our life.
1) How long do you want to live? Forever? As long as you can?
2) If you have a chronic illness, what quality of life do you want to continue living?
3) If you have a terminal illness, what quality of life do you want to continue living?
4) If you are partially paralyzed, what quality of life do you want to continue living?
5) If you are fully paralyzed, what quality of life do you want to continue living?
6) If you are losing your mind, that is, your capacity for thinking, what quality of life do you want to continue living?
Another thing I don’t understand is, why are medical costs going up?
Mathia Lee,
You have asked very interesting questions. If I were running the system, I would avoid the issue of insufficient resources by doing some risk pooling to avoid the problems altogether- but due to the income gap, I will make the rich pay more and poorest pay nothing….unlike the annuities scheme, rich and poor same amount but the degradation in quality of life is a lot more for the poor folks.
Suppose I hit the problem of insufficiency of resources. something akin to not enough kidney for all kidney patients. I would allocate based on need who needs it most urgently get it first. I think people with contributions to society, economic value, political power etc, they have all been rewarded other ways. I think the recent “Tang kidney case” highlight the issue whether the rich and powerful should go first or be allowed to purchase kidneys ….if you allocate based on wealth of a person, you will get plenty of resentment because most people are not rich and powerful.
[...] in Paradise. Growing Old In Singapore – Mathia Lee: Ageing populations: Determining YOUR future – The Temasek Review: $500,000 v $100m v $40b: Have a sense of proportion, [...]
Thanks everyone for raising very provoking questions and points.
I’m still thinking about them. In the meantime, just to provide insight on this question:
Another thing I don’t understand is, why are medical costs going up?
It is due to the very expensive process of drug/treatment discovery.
Over the last few thousands of years, humans have been doing science by observing our surroundings and our own bodies using our 5 senses — our eyes, noise, ears, mouth, skin to touch. Over this long period of time, we have discovered almost everything that can be discovered using this 5 senses.
In the last century, because of electricity and other fundamental inventions, we have been able to invent machines that have in turn allowed us to make greater quantum leaps in science. Machines like the telescope, the microscope, the x-ray machine etc.
Today, drug/treatment discovery in the field of medicine is made primarily with through the use of all these sophisticated equipment. These equipment costs a bomb — many of them the price of a HDB flat easily. So you can imagine to cost of research for one single drug.
Because these discoveries and inventions are not easy to make (there are no model answers at the back of life’s books) , the success rate (drugs making it from the start of the reseach process, to passing the safety tests etc and going on sale) of drug inventions is 1 in 10,000.
So when companies sell these drugs, they have to cover the cost of the 9,999 failures, by selling that 1 remaining drugs.
Also, there needs to be a sufficient profit margin so that investors would be willing to take on such huge risks (1 in 10,000 and no one knows when this 1 will pop out) in investing in the drug research process.
I’m sure many of you have heard about generic or low cost medicines. Such medicines are cheaper usually because the company’s patent has expired, or is willing to allow generic versions to be made. In this case, the cost of the drug is used to cover the cost of the manufacture —- it usually doesn’t cover the cost of the 9,999 failures, or the risk that the investors need to take.
So why don’t we go the way of producing low cost generic drugs from the start, for everything? Why do we use intellectual property and anti-piracy laws to protect rich pharmaceuticals? Because without this financial incentive, many investors would no want to take on such huge risks of failed drugs — they’ll channel their money into more profitable investments. Without this financial investment, research will slow and consequentially medical advancement will slow. While some argue that the State should take on these investments, others argue that it is irresponsible to use taxpayer money for such high risk ventures, and this should be left up to high-risk venture capitalists.
At the end of the day, all these makes new drugs/treatments very expensive, and the aged need more repairing than the young , and so we need to decide who and how to pay for them.
Letting old people suffer medically is economically the best solution if expanding GDP is our primary mandate. Our society seems to have no qualms about letting our old dig dustbins for cans to survive or making them take up onerous cleaning jobs. So what is the big deal about letting the old folks who can’t afford medical care suffer.
I think I left out a major part earlier:
Care-givers. When one is addressing the Ageing population, the ageing population’s needs are only half what needs to be addressed. The other half would be the needs of the Care-givers.
When Step-down , home care is encouraged, what infrastructure and support mechanisms need to be in place for these caregivers?
[...] Dispute – Singaporean Skeptic: I am glad there is no welfare in Singapore. – Mathia Lee: Ageing populations: Determining YOUR future – The Temasek Review: $500,000 v $100m v $40b: Have a sense of proportion, [...]
“What we really need is to reduce the number of years between the time people retire from economic activity and death.”
Harry said something like “the day you retire is the day you die”.
Perhaps it is a good idea to remove the notion of retirement. There are already many many instances that people degenerate very quickly the moment they retire.
With the notion of retirement, otherwise healthy and active working people degenerate quickly to become a problem such that they need care-givers. This create a spiralling demand for more and more resources that even the government will have problems coping as the ageing population increases.
Without retirement, rate of degeneration decreases, old working people continue to pay taxes, and there will be sufficient resources to take care of those who really cannot make it.
To make this work, there needs to be job and wage restructuring, because the current system gives pays wage increment year after year, it makes companies difficult to pay older workers at such a high rate while these workers have decreased working capacity.
CM,
Of course that is what the PAP wants, knowing them.
The problem is structural unemployment even if you want to work, there is no employment. The only employment is menial labor which is a bit hard to swallow – you do it when you’re old and your body is weakest. Then that does not pay enough, so the govt came up with workfare – adjusted to keep you just afloat.
This is a proposition that is hard to accept when all the PAP govt needs to do so that people can have a proper retirement is to sell its HDB flats cheaper and restrict CPF use only for retirement.