Sovereign Debt Payments Weigh on Euro Zone - WSJ.com

A New Retirement Age to Save the Economy: Sovereign Debt Payments Weigh on Euro Zone - WSJ.com:

"An interesting thought to ponder relates to retirement costs paid by government.

Historically, Bismarck has been credited with establishing the first social security type retirement plan in Germany back in the 1870's or 80's. At the time, the average life expectancy was 65. And, lo and behold, the age at which one got a pension was 65.

What would happen if government social security programs were rewritten to start at the age of average life expectancy?

This age could be constantly changing; and, there would be nothing wrong with people retiring earlier on their own money. But, by raising this age so substantially (well in the 75-78 area), we'd have much less cost pressure on young people to support old people; and, people on social security would know they were placing a much lower burden on the society at-large.

Of course, added incentives would be that such a later age (beyond the age most people would WANT to retire) would encourage more private saving. This would hopefully be available for investment rather than government consumption; and, we'd have better and more jobs (somewhat needed, if people work longer); but, overall, the societal standard of living would be much improved.

The current system makes no sense and is one of the major impediments to economies in the developed world getting back on track. (One could even posit a transition to these higher ages over say 10 years.)"