Demographic tsunami? Let’s dance!

Originally published in the Toronto Star May 30th, 2010. To go to the Toronto Star Website please click here

When it comes to issues of health and wellness for today’s seniors, there is a crisis that requires our immediate attention: the belief that an aging “tsunami” of Zoomers represents a financial catastrophe in the making. The supposed problems are the health-care and pension burdens we are about to impose on succeeding generations, as they struggle to pay for our huge, decaying demographic. Open any newspaper, walk into any bookstore, type “Boomer” and “crisis” into Google and you can’t avoid dire predictions.

What appears to be intuitively obvious is not backed up by a lot of empirical evidence. So allow me to spread a little doubt. The health-care tsunami thesis is based on a simple equation. At roughly the same time that our massive generation begins to cut back from work, we’ll also begin taking up a disproportionate percentage of the health-care budget. The problem is exacerbated because there are so many of us and we’ll likely live longer than our own parents did. If life expectancy were still 65, as it was in the early 1940s, it would be one thing; but life expectancy is now approaching 81, which means an extra 20 years or so on what the theory sees as a “health-care dole.” Thus, Zoomers are destined to take far more out of the public coffers than we put in. And because succeeding generations are considerably smaller than we Boomers/Zoomers, where in 2005 there were four workers “supporting” each retiree, by 2031 there will be only two. Ergo, we will no longer represent a net gain, but a net drain. Let’s start with the first half of the equation: How much will we actually contribute to society as we become a generation of seniors and elders and what I call the Immortals (100-plus)? In 2009, Canadians 45-plus (our Zoomer baseline) numbered approximately 14 million, or about 42 per cent of the total population of 34 million. These millions of Canadians made up 53 per cent of all tax-filers. What’s often overlooked in discussions of the senior “burden” is the fact that most retirees and pensioners continue to pay tax. By the year 2031, it’s projected that there will be about 19 million Canadians age 45 and older, or 49 per cent of a total projected population of 39 million. By extrapolation, Zoomers at that point will comprise 63 per cent of all Canadian tax-filers.

Unless we all receive tax refunds, the model suggests that we’ll be paying for the lion’s share of government expenditures in 2031 — but we’ll still be barely half of the population. Not only will we be paying for ourselves, covering all our own costs, but we might well be helping cover health-care costs for the next population waves as well. Such is the power of the Zoomer “tsunami.”

But wait, won’t Zoomers consume far more than simply their proportional amount of health care? Well, while it’s true that the health-care cost is definitely heavier for seniors, the degree by which it’s heavier appears to be far smaller than predictions would have us believe. According to the latest Statistics Canada reports, 90 per cent of Canadians aged 65-plus have visited a doctor “in the past 12 months.” This may seem high, until you consider that 82.8 per cent of Canadians aged 45 to 64 have also seen doctors in the past year; not to mention 80 per cent of 35- to 44-year-olds, 78.2 per cent of 15- to 19-year-olds and, surprise, at least 85 per cent of all children under 12.