geoff: New numbers from the
census bureau show the U.S.
Population is older than it's
ever been, with the nation's
median age over 38.
William brangham explains how an
older America could pose
significant challenges for the
economy, workforce, and social
programs in the years to come.
William: Between 2021 and 2022,
nearly every state in the U.S.
Saw its population's median age
go up.
In about a third of states, more
than half of the population is
older than 40.
Maine had the highest median age
of 44.8 years and Utah is our
youngest state with a median age
of 31.9 years.
As the share of older Americans
continues to rise, the need for
benefits and assistance from
medicare and social security
will grow.
At the same time, an aging
workforce could cause worker
shortages in the years to come.
Joining us to discuss the
implications of this shift is
Philip bump.
He's a national columnist for
"The Washington post" and author
of "The aftermath: The last days
of the baby boom and the future
of power in America."
Also joining us is Wendy
edelberg.
She's director of the Hamilton
project at Brookings.
She's a former chief economist
for the congressional budget
office.
Thank you both so much for being
here.
Wendy, to you first.
The median age in the country is
38.
Back in 1980, it was 30.
What is the main reason why this
trendline is taking upwards?
Wendy: Two main effects.
One is that we have improvements
in mortality rates.
We are living to older and older
ages and that is only good news.
But we also, like many countries
across the globe have declining
fertility rates.
We are getting hit on both
sides.
William: Do you know why we are
having fewer kids in general?
Wendy: There seems to be a trend
that goes along with countries
as they get richer.
It is not in and of itself a
worrying development.
It is absolutely true we are on
track for slower labor force
growth.
Half the pace of growth than
recent decades.
But, we are also a country that
is greatly valued by immigrants.
There are immigrants from all
over the world who desperately
want to come to the united
States.
We have a very simple way of
boosting our population growth
if that becomes a priority for
us.
William: Philip you mentioned in
your book and your column this
is not just all Americans
getting older.
It is principally white
Americans getting older.
Can you explain both of that,
the demographic reality and the
implications?
Philip: One of the reasons the
United States is getting older
is we have this massive surge in
births in 1946 and 1954 that we
call the baby boom.
This massive influx of Americans
all in the same age range.
The size changed over time
because immigration laws were
loosened, and of course, because
people die over time.
This is a continuation of the
pattern we saw with the baby
boom in the 1940's.
A big cluster of people all in
the same age group that are
reaching age milestones
together.
When you think about the year,
1957, you get 2022 for their
retirement age.
The baby boom was a very heavily
white generation.
Immigration was restricted by
law about a century ago, and
that lifted after the baby boom
was over.
That led to a very white
population.
What we see when we look at the
population today is that older
Americans are disproportionately
white.
The youngest Americans are about
half nonwhite.
About half of them are black,
hispanic or Asian.
Older Americans, that is not the
case.
That overlaps with a lot of the
political and cultural trends we
have seen.
William: Wendy, as you were
touching before, a lot of
potential implications here.
One of them seems that programs
like medicare and social
security require a larger pool
at the bottom to feed a
relatively smaller pool at the
top.
Does that mean for us policy
was, if we are seeing this aging
population?
Wendy: Payroll taxes as a share
of the whole economy have been
roughly flat for decades and are
on track to remain flat over the
next decades.
But at the same time, our
spending on social security,
ignoring the fact that the trust
funds will get exhausted in
about the next decade, social
security benefits are projected
to increase by 50% relative to
its share in previous decades.
And medicare, health care
spending on the elderly, is
projected to double.
The challenge here is that
largely because of our aging
population, but also because of
increases in health care costs,
we have very significant
increases and benefits on the
horizon, but we have not planned
for those with increases in
taxes.
William: Hearing what Wendy is
describing, that the demographic
reality and the cost going
upward, what do the policymakers
have to address that?
Philip: It depends on a number
of factors.
It depends on the willingness of
policymakers to raise taxes,
decrease spending, reduce the
amount of benefits people are
receiving, which will cause a
lot of political backlash if
they choose to do so.
It depends how money people are
paying into the system.
If we bring a bunch of
immigrants -- we have seen this
strain on the number of people
being hired.
Whenever started researching my
book in 2021, we are going to be
gasping for jobs to people to
fill these jobs in short order.
Again, we have seen this
pattern.
Over the course of the
beginning, when the baby boom
first emerged, we have to build
a bunch of schools.
Luckily, we were able to
accommodate it.
Now, the baby boom is having to
compete for power and resources
with another comparably sized
generation, millennials.
We see there is additional
political tension for the baby
boom generation at this moment
when they have reached a stage
that it was foreseeable, but
causing a lot of strain.
William: Wendy, the tensions
that Philip is describing are
not easily remedied.
Addressing medicare and social
security are third rails of
American politics.
Immigration is right behind
that.
What do you see as the most
likely things policymakers will
do to try to address this?
Wendy: Because of the way we
have organized the social
security program and the
medicare program as trust funds,
these will become very
politically salient over the
next several years.
So, because we are spending out
more in social security benefits
and in medicare benefits,
particularly hospital insurance
benefits, because we are
spending on more than we are
taking in on taxes, the trust
fund for social security is
projected to run out of money by
2031.
And the medicare hospital
insurance trust fund soon
thereafter.
What that will mean is under
current law, if there are no
changes, then the social
security benefits would be
constrained by how many taxes --
how big the tax revenues are
that are coming in.
We only taken about 75% in taxes
for the benefits that go out.
Without any change in law, you
are talking about an
across-the-board cut in social
security benefits of 25%.
Talk about third rails.
That will never happen.
So, that will be a strong
impetus for policymakers to act.
William: One of the things you
both have touched on is the idea
of bringing in more immigrants
to add to that workforce, to
create more payroll taxes to
help fulfill these gaps.
Again, you cover national
politics as closely as anybody.
How likely do you think this
issue will help be a lever to
true immigration reform in this
country?
Philip: It depends what you mean
by true immigration.
It is certainly the case that
both parties have a vested
interest in changing the system
and away they might not have
previously.
The Republican party is very
heavily old.
There are a lot of old Americans
that are members of the
Republican party more than the
democratic party.
Hey, we need to cut what they
call entitlements.
There is no longer the same push
within the Republican party now
that a third of the Republican
party will be the age of 65.
These things are shifting.
I think it will be the case as
well that the Republican party
may be increasingly open to the
idea of reforming immigration in
a way that makes it sustainable
to be able to pay out social
security benefits.
Now, they can be the competing
in the party and it needs to be
resolved.
This is the moment of flux.
It is caused largely by the baby
boomers having reached this age,
but a moment influx where the
party's positions may change.
William: Philip, Wendy, thank
you both for being here.
>> Thank you.
♪♪