Notes From the Fieldby Martin Weil

June 14, 2013

Changing Retirement Expectations, an ongoing series

Perhaps it is time the pendulum swings the other way and retirement returns to its original intent—as optimal workforce nonparticipation rather than self-enriching entitlements voted in by popular demand and aided by governments which are uninterested in acknowledging a crisis …

Jason Hsu, of Research Affiliates

What Hsu is saying is that the concept of retirement  – as formulated initially in the late 19th century in England and greatly expanded upon in the post-Depression era in the US, was originally meant as a way to ration labor.  In other words, to prevent the very young and the very old from occupying employment positions that could be more profitably filled by more able workers in their 20s-50s.

Retirement then gradually evolved into an entitlement program post WWII, allowing older citizens of developed nations to retire in a comfortable lifestyle. The article points out that this model is likely unsustainable in developed economies and has perhaps even outlived its societal purpose.

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