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KING: Thoughts on Age in General and Biden’s in Particular

The case for Joe Biden to accept the inevitable dictates of his age and not run again is persuasive. Too much rests on the health and fitness of the president to turn it into a kind of roulette: When will his number come up?

Worse, what if Biden fails mentally and stays in office incognizant of his condition? Being the president of the United States is the most demanding and most responsible job in the world.

Winston Churchill got a second term as prime minister of Great Britain in 1951, and lots of stuff went wrong, from immigration policy to the growth of unchecked union power. History’s greatest prime minister had lost his acuity.

As I am older than Biden, I can say he should quit. I love to work, but there’s the rub: Not all people and all work are created equally. What I do isn’t critical and doesn’t decide the nation’s future or war and peace.

No one would suggest that an artist toss the easel at a predetermined retirement age. Noel Coward, the great English entertainer, said, “Work is more fun than fun.” That depends on the work.

Age is a complex equation for society, and retirement is a nettlesome problem. France is in revolt over President Emmanuel Macron’s move to raise the retirement age from 62 to 64. Very reasonable, most Americans say.

The issue in France is simple: The French can’t afford huge state pensions any longer. There aren’t enough people at work to pay for those who have retired on their nearly full salaries. You can vote the population rich, but you can’t vote in new, young taxpayers to keep them rich. When the Social Security system falters in the next decade, America may be staring at the same sums as Macron.

Mandatory retirement is a crude way to manage the retirement dilemma. Some workers are genuinely unable to work into their 70s and 80s because their bodies, their minds or both are worn out. Others are at their most productive.

My father’s mind was fine, but he was a mechanic who had done everything from building steel structures to working in mines to repairing cars. His body failed around the age of 6o. He had been doing manual work since he was 13 years old, and he couldn’t bend, twist, delve, lift, climb, stretch, grab or do any of the myriad things he had done all his life to earn a living. He had to work in a school and then a shop; he loved the school but not the shop. But he had to work. That is what he did: He got up every day and went to work.

He had worked so long and so hard, primarily self-employed, that he hadn’t had time to learn leisure — to play golf, to watch ball games, to read for recreation, or even to learn how to socialize. That came with work or didn’t happen; friends were people at work.

A friend of mine, a nuclear engineer, reached mandatory retirement age and fell apart, much as my father nearly did. He, too, had no interests outside of his family and work and was lost in the post-job world.

Something of this same problem exists for people leaving the military. Their life is the military, and then, at an early age, there is no more of that life, their life.

When it comes to Biden, things are quite different.

I know the president slightly, and I like him personally. He loves the job. He has been at the peak of power for a long time. When his term ends, he should adjourn to his beach house in Delaware and write his memoirs.

Maybe someone will teach Biden how to play boules, a European form of bowls played by older people in parks. French boules aficionados would be happy to teach him the game. The French have a lot of time in retirement to perfect their play and travel to beach destinations. They would love to bring their skill to Rehoboth Beach, Delaware. Maybe I should join them.

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Pennsylvania Retirement Funding Problems Coming Over the Next Decade 

A Pew Charitable Trust study released earlier this month features the eye-popping headline “Pennsylvania’s Looming $17.8 Billion Fiscal Shortfall.”

It finds as many as 2 million private-sector workers in the commonwealth don’t have access to a workplace retirement plan. As a result, many aren’t saving enough for their golden years. That “could lead to $14.6 billion in increased state spending and $3.3 billion in lost state tax revenue” over the next decade or so, the study warns.

“Pennsylvania’s population aged 65 and over is projected to grow from 2.49 million in 2020 to 3.04 million in 2035, and the number of the state’s vulnerable older households—those 65 and older with less than $75,000 in annual income—is expected to increase by 17 percent during that time,” Pew reports. “That could mean bigger costs for state welfare programs.”

While the number of elderly Pennsylvanians will rise between now and 2035, the number without a big enough retirement nest egg will also grow unless people can be persuaded to save more, according to the study.

Pennsylvania State Treasurer Stacy Garrity says the challenge of paying for state services for the elderly has been papered over with one-time COVID aid from Washington, D.C. But as the retirement savings deficit builds over the next few years, “We will reach a fiscal cliff. It is common sense that we should prepare for it now,” Garrity added.

Meanwhile, says John Scott, director of Pew’s Retirement Savings Project, the percentage of households relying on retirement income is growing faster than working households. In 2020, there were 43 households age 65 and older for every 100 ages 20-64, Scott reports. By 2035, that number will grow to 56 households age 65 and older for every 100 working-age households—a 29 percent increase—meaning that there will be fewer taxpaying households ages 20-64 to support a growing elderly population.

“The tax base of the working households to elderly households is not growing as quickly. So this will place more stress on taxpayers,” Scott says. He says vulnerable elderly households in the commonwealth are those with annual incomes of less than $75,000. The average retiree will fall short of that annual number by about $8,000 by 2035. Scott says that means many retirees without adequate retirement nest eggs will need a higher level of financial support from the government.

The state, Scott adds, should try to ensure that more people headed for retirement are saving enough to live comfortably. To prevent that he believes systematic savings plans should be widely available.

Garrity says workers are “15 times more likely to save for retirement” when there is a workplace payroll deduction retirement plan option. Not saving enough for retirement, will “have a huge impact on their personal lives and on the government of the state of Pennsylvania,” Garrity said at a news conference discussing the Pew study.

How did we reach this point?

“The problem of undersaving in Pennsylvania is 44 percent of our private sector workforce doesn’t have access to a workplace retirement savings plan. That’s a huge number,” says Garrity.

“These savings shortfalls,” according to the study, “could lead to increased pressure on public assistance programs, reduced tax revenue, and decreased household spending by retirees while shifting the growing fiscal burden to a shrinking population of working-age taxpayers.”

The problem of retirement undersaving is a national one, Scott notes. About one in three private industry workers in the United States lack access to retirement programs through their employers. One in three workers in Pennsylvania has the same problem. However, “increased savings could effectively address this debt,” Scott says.

Financial planners say the most effective way to accumulate enough for retirement or any long-term goal is a program of regular investments compounded over long periods. The longer one invests, they say, the more likely one is to enjoy one or more bull markets.

Garrity argues Keystone Saves, a measure proposed in the last legislative session in Harrisburg, would reduce the problem. Keystone Saves is a state-sponsored retirement plan that would fund retirement plans through payroll deductions. Garrity’s office estimates that, if a program such as Keystone Saves were adopted, the state’s fiscal burden “could be avoided entirely if eligible households contribute about $100 a month. Some employers now don’t offer retirement plans because start-up or maintenance costs are too much for them.”

A Keystone Saves plan was considered in the last legislative session but didn’t pass.

A Garrity spokeswoman says she expects the bill will be reintroduced this session. She thinks the measure will have bipartisan support and the governor will likely support it.

A spokesman for Gov. Josh Shapiro didn’t respond to inquiries from DVJournal.

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