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December 10, 2012

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pablopatito

I'd like to see the Stones doing several hundred dates in dodgy dives whilst loading and unloading their own equipment into a van, like most "young" bands have to do. If they managed that, then Ms Tett would have a point.

But mainly, if there are only a set amount of jobs in a country, I don't understand the point of old people working in order to pay unemployment benefits to young people. Surely, it would not cost the economy any money to simply switch those roles and have the young pay benefits to the old instead?

No-one has explained to me how increasing the supply of labour will increase GDP? I don't get the connection. Normally, every time someone retires at my work, they are replaced by a youngster. If they choose to carry on working, we simply don't employ anyone new.

Luis Enrique

it's a confused argument. Her real point is that people are dying later, so we need to fund longer retirements, and might consider working longer to do so, if we want to maintain annual incomes in retirement. This point holds true even if you regard retirement as escape from wage slavery and is only tangentially related to older people being more physically able nowadays.

Francis Sedgemore

"Am I alone in thinking that Mick Jagger is one of the biggest twats who ever drew breath?"

No.

Tom

Just because it's desirable, doesn't mean it doesn't have to be funded. And when politicians do the funding, with money taken by force, it's guaranteed - at best - to be screwed up . And far more likely diverted to bribes for unproductive electors and big fat, reality-divorced, pensions for the politicians themselves.

BenSix

I am dumbstruck by the stunned that the Rolling Stones could be an argument *against* retiring. The only thing more depressing than seeing them in their current condition would be seeing the Beatles in theirs.

BenSix

[*] dumbstruck by the idea

cjcjc

"It is only two-thirds of the standard deviation of the share of government spending in GDP since 1966."

Did you include this because it sounds clever?
In any event, I'm sure you are familiar with the concept of opportunity cost!

Tom is right - it has to be funded, and it is not the empty debate you seem to suggest!

Rob

You could attack this from the opposite direction - we should worry less about the binary distinction between work and retirement and more about abolishing drudgery in general. If more people could have the level of self-direction in their work that the Rolling Stones have, the retirement "problem" would take care of itself. "Everyone should be able to live like Mick Jagger" might be an unusual political rallying cry, but I've heard worse.

Curmudgeon

Um, 2.6% of GDP is very big money. Since your entire argument depends on considering that inexpensive, I can't even begin to buy it. Life is freedom. If you consider working to be wage slavery, you have more serious problems.

Romford Dave

Even the drudgery of abolishing drudgery becomes a drudge in the end and anyway isn't the rallying cry supposed to be 'Move like Jagger' rather than to live like him Rob?

I'm not sure the hardpressed taxpayer could stomach the cost of funding his lifestyle, even if it was just for a lucky few original Stones fans from way back when.

Philip Walker

pablopatito gets homework: "The lump of labour fallacy. Discuss."

Chris says, "But it might be reasonable for future generations to make Keynes' choice, and to exercise that choice not so much by working less each week, but by freeing themselves from wage slavery as soon as possible."

1. As you note, we are already making Keynes' choice; just more slowly than Keynes expected. In essence, we're trading less of the productivity gains for time, and more for improved goods and services, than he expected. To the extent that this represents an under-valuing of liberty, it is a depressing thought; but on the other side of that coin, let me observe that in all probability, we wouldn't be able to have this electronic discussion had we made Keynes' choice. It is not zero-sum with respect to freedom.

2. We are, in fact, extending a period of worklessness: by increasing the number of undergraduate and graduate students. I don't know what the marginal effect of encouraging young people to stay out of the labour force would be, compared with pushing out older workers. I can see swings and roundabouts, and I suspect that the retirement age effects will dominate the university effects. But I would want to see a proper empirical study before sticking out my neck.

3. Keeping ahead of the Joneses is a common desire. Hence there will always be people, and I think a lot of people, who want to consume more than their allocation sufficiently badly to work to obtain it: in other words, my first point will always be true. True, that is, unless one considers a (hypothetical?) future in which Noah Smith's desire modification technology becomes reality.

Chris Purnell

Why would an anthropologist like Dr. Tett wish to argue from the particular to the general, I wonder? 70 year old building site workers might be less visible but more pertinent. These gruesome politicised remarks are unworthy of intelligent people, even if they are making a political point.

Keith

The reason why Keynes got his timing wrong is I assume that like this Dr. Tett he was rich. For a wealthy man like Keynes who always new wealth from an early age leisure is a pure good and indeed an important element of liberty. But for most people who do not enjoy a trust fund material goods are much more important and worth some sacrifice of time to acquire. Dr.Tett seems to be making the same error by comparing very wealthy musicians to ordinary pensioners. For the stones public performance is now just a hobby it stopped being a job decades ago if it was really one at all. They seem to have been instant successes and spent their time in a decadent stupor. So they are not representative of most people.

As for pension ages etc society has assumed the obligation to provide decent retirement for all and should fulfil its obligations rather then looking for excuses to welch on the deal ex post facto. "From cradle to grave"...

Jacques René Giguère

With the rise in qualification, we have a high fixed cost cum debt to pay . So, while our marginal cost of working gets down ( as an economist, I need acomputer and date connection), I have to defer my retirement to pay for it. But my job is also a lot of fun and a luxury goodFor the rest, remember the 1960 primary. JFK goes to West Virginia and is aked by an old miner:
"Son, is it true your father is a billionnaire?" "Ah Yes" (slightly worried)
"Is it true you never worked a day in your life?" "Ah Yes" (more worried)

Long silence.
"Son, you never missed a thing."

Sam Hutchinson

Yeah, but.....The Stones can't sing as this...
http://www.youtube.com/watch?v=p-C02_WfrFA

FromArseToElbow

Keynes was writing at a time when the working week was still coming down, after over a century of factory acts and union bargaining, so projecting further decreases was reasonable. It wasn't just the daydream of a rich dilletante.

The question is why this decline stopped and has even inched upwards since the 80s in the form of unpaid overtime. Remitting productivity increases (in part) for shorter hours did not impede growth prior to the 80s. Similarly, we didn't all decide at that point to take 100% of productivity gains as increased wages, as that was the moment when stagnant (male) wage growth started.

The argument in favour of later retirement is essentially an argument for increased exploitation of labour, as the extra years of work do not exclusively pay for increased pension costs (despite the propaganda) but also deliver a greater quantum of profit (i.e. surplus value) per worker lifetime.

As Gillian Tett notes, the class inequality in increased longevity means that poorer workers will benefit less in terms of expanded retirement. Indeed, if the age of retirement increases proportionate to longevity, those as the bottom of the pile would see their retirement years start to decline (see http://fromarsetoelbow.blogspot.co.uk/2012/05/time-and-money.html for detail on this).

Sam Hutchinson

Hey, Jacques, the guy who sings, in that video I just posted, is from West Virginia.

Churm Rincewind

"For most people, then, retirement means liberty." Well, no, for most men (women are oddly excepted in the studies I've consulted) retirement means death.

Achilleas Chrysostomou

and as mentioned above. not all jobs are the same. I dont know how the system currently treats manual labor retirees vs. office workers but it definitely shouldn't be the same way.

Sam

Achilleas: That only begins to make sense if you assume that manual labourers come out of one drawer, office workers a second, and never the twain shall meet. In reality, there's a continuous distribution of physical labour required for different jobs, and people don't hold the same job for their whole working career.

Yes, it's true that someone a bit frail can happily sit behind a reception desk, but can't dig ditches. Are you suggesting the state should allow ditch-diggers to claim full benefits at an earlier age? What if I'm a ditch-digging supervisor and don't actually dig any more, but stand and watch? What if my job is classified as "ditch digging required" but I actually sit at a computer all day.

Or maybe you just charge an extra 2% NI for heavy manual labour jobs, and you get to take the early benefit if you have 10 years of higher contributions or something.

It's nonsense.

Neil

'pablopatito gets homework: "The lump of labour fallacy. Discuss."'

I think he just did, and came to the conclusion that it's not a fallacy at all.

Still, who to believe - the 'it must be a fallacy because I wrote fallacy after it', or our lying eyes?

pablopatito

Saying that the supply of jobs is fixed may be an exaggeration (or schoolboy error, delete as applicable), but when youth employment is running at 20%, I wonder if the supply is currently decidedly sticky? And since few, if any, countries have yet raised the retirement age to 70, implying that the fallacy is proven seems to me to be a bit dismissive.

Ian Leslie

I'm perplexed by this kind of argument. If the problem that work isn't fulfilling enough for most people (which I'm sceptical about - we're always unhappy some of the time and work is a convenient culprit) then surely the answer is to *make work more fulfilling* - rather than simply trying to allow people to end it earlier. I speak as one very sceptical of the benefits of untrammelled leisure time ('freedom'). For many, that is itself a kind of prison.

gastro george

"... *make work more fulfilling* ..."

Allowing people to raise their noses off of the grindstone is not perceived to be in the interests of most managers or advertisers.

Retired and loving it...

HOLY CRAP! A few people here dare to say work is not drudgery because they found something they enjoy, and were likely able to pay for their education or had Daddy do it, or at least had a multitude of choices for education and perhaps employment opportunity. Not many people are in jobs they love or can afford to switch it up should they not find their niche... (especially after an economic downturn)

Most people work simply because they have to, not because they want to. And Curmudgeon dare I say that someone who prefers being at work either has a cushy job where he is able to slack off and gets lots of vacation time or, a dreadful life at home or no life ... and so has become a workaholic.

As someone retired, and who loved their job, retirement is freedom from being on the clock and the drudgery of serving others... which all workers do to some extent. Vive la Liberté.

Sadly the real problem is that most people do not prepare for retirement and are relying on Social security, when dwindling working populations can't sustain it.

James

"I speak as one very sceptical of the benefits of untrammelled leisure time ('freedom'). For many, that is itself a kind of prison."

And for many it isn't, it's not really for you to decide how someone should feel about work, however much you'd like to. And how exactly do people who have been doing manual work all of their lives, living paycheck to paycheck, with at best a high school education *make work more fulfilling*? how does a woman in her 50's who is a cleaner maker her work more fulfilling? get herself a new mop and bucket?

You're perplexed?, more like a fucking half-wit.

Philip Walker

"I think he just did, and came to the conclusion that it's not a fallacy at all."

I think you may find he didn't. He started his argument with, "If the supply of jobs is fixed..."; that is, with assuming that the supply of jobs is fixed. One cannot assume the consequent and present a logically sound argument. Hence, he cannot have (legitimately) concluded that the lump of labour idea is not a fallacy.

pablopatito: Clearly in the very short run (like over the coming week), the supply of jobs is so close to fixed as to mean we might as approximate it as fixed. But it is clearly and demonstrably not fixed over a period of a decade. The argument comes over what period of time it is legitimate to treat the supply of jobs as fixed. I am sceptical that it is fixed over a period of, say, twelve months: certainly the lifetime of a parliament!

guthrie

Those with untrammelled leisure time traditionally run lots of socially important things, from church fetes to pressure groups. However if everyone is having to keep working to live, then that ensures money and professionalism further takes over life.

Neil

"Normally, every time someone retires at my work, they are replaced by a youngster. If they choose to carry on working, we simply don't employ anyone new."

I guess you missed that part, Philip.

pablopatito

Philip, ok, but if there is a 10% increase in the number of jobseekers, what is the effect on jobs - do they increase by 10%? Or 15%? Or 5%? You seem to have access to the figures ("it is clearly and demonstrably not fixed over a period of a decade"). I'm sceptical. And does it matter if the old tend to be savers and the young tend to be spenders?

I have also found, anecdotally, that productivity declines when you enter your sixties. Not because of declining health, but simply because you can't be arsed any more. I work with a lot of people who turn up for 35 hours a week but I call them semi-retired, such is their attitude to work. What can you do? They'd welcome a big redundancy pay out. I'm not being ageist: to put it another way, I'd say that productivity and attitude to work declines once you have paid off your mortgage and have worked sufficient years to build up a large redundancy entitlement.


Philip Walker

Neil: nope, didn't miss it. One workplace doth not a general argument make. And even pablopatito's workplace, once upon a time, employed no-one. Then it employed someone, and then two, and so on. Its total workforce has grown over time. And, if it continues to prosper, it will continue to add people.

And this is the key point: this process of jobs expansion happens slowly, in small numbers, at scattered workplaces up and down the country. One workplace is not sufficient to show whether it is happening.

pp: The effect of the number of unemployed on the number of jobs is not simple or linear. But your incorrect claim was that the number of jobs is fixed. It is not, as a general statement. It can be considered as fixed over very short timescales (e.g., the kind of timescale over which your retiree example applies), and perhaps also fixed with regard to certain economic variables.

But to suppose that the number of jobs is fixed generally is demonstrably false. That's why the total employment figures vary, after all, and they vary from quarter to quarter.

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