CHARBONNEAU – Fears of a grey tsunami are greatly exaggerated

CANADA’S AGING POPULATION has become a lightning rod for generational angst. Younger generations worry that baby boomers are hoarding wealth, draining pensions, and straining our health care system.

Prognosticators have been forecasting a gloomy future for decades: One in which fewer workers can support an aging population.

This massive influx of seniors, they fret, will reshape society. Medical and long-term care systems will face an unprecedented demand. This threat will be doubled by escalating healthcare costs and a shortage of medical professionals as older doctors and nurses retire.

This gloomy picture of fewer workers is a result of work by economist Alvin Hansen. In 1938 he proposed that slow population growth would result in a stagnant economy.

In the Dirty Thirties, it must have looked that way.

This view, however persistent, is flawed. Things have changed since then. For one, baby boomers are not draining the public purse any more than any other generation.

Over the course of our lives, Canadians move from being contributors to public programs to being receivers of them. We receive publicly funded health care at birth, education in youth, and pensions and health care in old age. Canadian workers fund these services for themselves, for others and for their future selves.

In their article, Sasha van Katwyk and Michael Wolfson argue that the welfare state has evolved considerably since the Great Depression. Van Katwyk is a senior health economist based in Alberta. Wolfson is a former assistant chief statistician at Statistics Canada.

“From this lifetime perspective, most Canadians are net beneficiaries of the welfare state,” they say. “Based on our analysis of current patterns, roughly the bottom 60 per cent to 70 per cent of the population by income receive more in public pensions and health care over their lifetimes than they pay in taxes. It is primarily the top decile of earners who contribute substantially more than they receive.”

Not only has the welfare state evolved since the Great Depression; automation has reduced the number of workers in labour-intensive areas.

Hansen could not have anticipated automation, computers, robotics and AI. Since the Thirties, technology has filled in for some of the labour lost through aging.

Agriculture is a prime example. In the Thirties, almost a third of Canadians worked on farms. Now it’s two percent and the amount of food produced is greater.

Tractors replaced horses and much of manual labour; combines replaced harvesting crews; and mechanization, fertilizers, improved crop varieties, irrigation, pesticides, GPS-guided machinery and increasingly automation allowed each agricultural worker to produce far more.

Automation and technology increases productivity.

The prospect of Artificial Intelligence has generated a lot of fear and apprehension. But AI wouldn’t necessarily replace workers. Rather, it would make each worker more productive.

In a more productive hospital, AI systems could assist in diagnosis, monitor patients continuously and detect complications, handle documentation and schedule staff, and automate routine laboratory work,

The objective isn’t necessarily to eliminate workers. It is to make each worker much more productive.

Given the market of supply and demand, fewer workers means that they will be paid more and pay more taxes in order to support social programs. They do it for others and their future selves.

David Charbonneau is a retired TRU electronics instructor who hosts a blog at http://closetproductions.ca/EyeView/eyeviewcover.htm