Our Ridiculous Approach to Retirement (US Stupidity)

[Broomstick]

Another thing that just did not happen 30 years ago: someone hacking into your bank account and racking up bills that you would then be held responsible for. Seriously, this identity theft problem just didn't happen 30-40 years ago. Someone might mug you, but emptying your bank account for you was much more difficult for the criminals to pull off. Now, they don't even have to be in the same country.

It's only a small slice of the whole, but getting your identity hacked can fuck you up financially for decades, not to mention the time and energy you expend over and over and over again trying to restore your good name, clean up your credit score, and so on.

[Surlethe]

Most of my point stands. People will study enough to pass the exam and then live as locusts. The test should make sure they want to apply what they learned as well, otherwise it's pointless.

Not quite. Having passed such a test says that they know enough to handle themselves. If they have any problems, it's because they're being stupid, not because society shortchanged them. If they're dumb enough to screw up their lives after they pass a liability waiver test, fuck 'em.

I know tons of people that know lots of information and procedures and can lecture you on that but in real life are dumb as a fleet of bricks and follow their cock/feelings/whatever instead.

Zero sympathy. Fuck 'em.

The only way is to have some kind of statal or private infrastructure do the job for them.

Or we could just have a welfare net that catches people before they become completely destitute, and fuck 'em otherwise if they're too stupid to manage themselves.

[The Duchess of Zeon]

I'm not sure how my defining it based on ability to work could be said to leave a gap or loophole for someone with Alzheimers or otherwise unable to function at a relatively young age.... If doctors can corroborate it, that's fine. I just want to end the baby boomer culture, not cause people to suffer.

[Simon_Jester]

It's difficult for someone with most mental illnesses if the default expectation is "suck it up and keep working to 70 unless you've got bits falling off." Being humane about this means a lot of people end up retiring in their 60s anyway, because there's a big gap between "able-bodied enough to perform what household chores you feel like and go on vacations" and "able-bodied enough to be a genuinely desirable and worthwhile employee in a full-time job."

Unemployment is already rather high, and likely to remain so; the average person in their 60s is at a competitive disadvantage without some very special skills that make their long work experience more desirable, and exceptionally good health for someone of that age. Both are possible, but simply expecting that small subclass of workers to keep working five or ten years longer won't change the balance of payments as much as, say, removing the Social Security tax ceiling.

[D.Turtle]

...What on Earth are you talking about?

Please reread my post; you seem to have missed some of the nuances in "assuming that [they] solve this problem... and come up with something other than [bad thing]." That's not the same as "[bad thing] is going to happen, I JUST KNOW IT."

The fiscal reality for me is that I have no idea what to expect in the way of retirement. None whatsoever. That's far beyond the horizon of what I can predict- the other side of peak oil, the other side of the death of the baby boomers and the retirement of Generation X, the other side of America either fixing its structural deficit or collapsing under it (we can maybe run at debt equal to 100% of GDP, but 200%? More?)

I'm a relatively young man. I expect a lot of things to change before I get into my mid-sixties, and I don't expect to predict them all in advance. Does that bother you somehow?

What bothers me is when people either start screeching about problems that aren't there, or throw up their hands in resignation and say they can't know anything at all.

Social Security at the very least is a pretty secure and robust system that requires only minor reforms in order to be secure in its present form. That is something that is pretty safe to bet on.

Safer than speculating on the stock market.

[The Duchess of Zeon]

It's difficult for someone with most mental illnesses if the default expectation is "suck it up and keep working to 70 unless you've got bits falling off." Being humane about this means a lot of people end up retiring in their 60s anyway, because there's a big gap between "able-bodied enough to perform what household chores you feel like and go on vacations" and "able-bodied enough to be a genuinely desirable and worthwhile employee in a full-time job."

Unemployment is already rather high, and likely to remain so; the average person in their 60s is at a competitive disadvantage without some very special skills that make their long work experience more desirable, and exceptionally good health for someone of that age. Both are possible, but simply expecting that small subclass of workers to keep working five or ten years longer won't change the balance of payments as much as, say, removing the Social Security tax ceiling.

There needs to be no stigma built into the system. Get three doctors' opinions that you can't work anymore, automatically you go on, no review. The goal is cost suppression. A long time ago people worked until they were almost dead; it is unique and anomalous that such hasn't been the case in the past century, and costs are reasserting themselves. Eliminating the Social Security tax may help for a bit, but as lifespans and health continues to improve, I guarantee it will fail eventually. Not only that but we'll be wasting the potential of all these people and they'll be essentially dragging down society. Presently life expectancy is about 78 in the US, so if it's set at 70 and then tied to life expectancy, the retirement age will slowly increase for later generations. Note that people already in their 40's, etc, would have their retirement ages preserved. Also under the current system you can retire 3 years early (67 in my proposal versus 62 now) or 5 years later (75 versus 70 now) for varying degrees of payout; less if you retire early, more later. That would still be the case, and it would be the only gradation -- you would be rewarded for working longer; everyone who worked until a certain age would get the same amount of money however.

Remember that by providing a guaranteed income--we are increasing costs. In this case for a worker who's made the maximum (around 100k a year) since age 22, retires at age 70, is guaranteed $3,266 USD a month at present. That would be the level you get retiring at 75, until death. Retiring at 67 you'd get $1,855 USD a month until death. Essentially everyone would be guaranteed this maximum benefit, which would be automatically tied to inflation, in the same way the age at which you would be able to collect these amounts (in fixed 2012 dollars, so actual amount higher, again) would increase with improvements in human lifespan. If you are disabled and unable to work for any reason (with three notarized concurrences by medical professionals, no review or appeal required) you get the amount you'd have otherwise gotten at 67, indefinitely.

If there is surplus money after this expansion of benefits and increase in age of collection of benefits, then we can use that money to issue bonuses which pay for Medicare Plan B for people, in whole or part. To further save money, I'd also introduce a phased reduction in payout amount down to $1,855 monthly in 2012 dollars for people with more than 10 million in assets so that if you have more than 20 million in assets you receive $1,855 monthly no matter when you retire--note, you cannot start collecting until 75 (age inflated with life expectancy also, remember), if you're still paying taxes, so it does actually prevent people from just "retiring" at 67 and continuing to work quite effectively--and then of course bonuses for paying Medicare, if applicable within the reserves created by increasing the taxable income, would phase out starting at 1 million in assets.

This is still retardedly generous. It would give someone close to 40k a year to live off of if retiring after age 75, more than 20k a year if they retire at age 67. I've been living on 14k a year since I was 23 - 24, for the past five or six years, and with the additional bonus for paying medicare that may well be possible after a rigorous investigation of the financial reserves, these people would be getting substantially more even though their costs are less than those for a young person. I don't really understand how they can hand those 60k a year pensions in some countries when I have broken my back and health for the whole of my twenties trying to claw myself into a position where I can work to make that much. If you want that much money a year when you're retired, save some of it while you're working. 40k is quite enough for a single individual to live off of--and under the plan, a couple would receive 80k, since the amount is no longer tied to work history. So is 20 - 24k, if you live modestly, it is more than enough, and maybe we should appreciate the benefits of modest living, especially if you want to retire early.

[Surlethe]

Why would you guarantee payment of 80% of per-capita GDP, Marina?

[The Duchess of Zeon]

Is THAT how much social security pays out? Huh. Sorry; I just didn't think about it in great detail but went off the existing tables on the Social Security website. As it is right now... Yes, someone who retires at 70 will get 80% of the per-capita GDP as their annual social security payment. Which is kind of absurd.

[Surlethe]

Oh, you pulled them straight from the SS tables? Wow, I didn't realize SS would pay out 80% per-cap GDP to someone retiring in their 70s.

You know, it might just be easier to guarantee a minimum income of 20% or 25% per-capita nominal GDP to every (adult) person in the country and dispense with social security altogether. Then we don't have to worry about disability, early retirement, inflation indexing, retirement age indexing, indexing the pension amount to the age of retirement, and so on.

[Simon_Jester]

For people with disability, that's probably not going to be enough to cover medical expenses and allow a vaguely decent life. And by "vaguely decent" I mean the same kind of around-poverty-line lifestyle Marina's talking about, where if you're clever and healthy and do all your own vehicle maintenance you'll be all right.

Also, we can hopefully depend on most old people to have some meaningful savings or other means of support in their old age, which supplements the guaranteed pension. For a 40-year-old man with cerebral palsy and deafness, not so much.

So yeah, we'd probably still have to worry about disability.

Of course, we could fix that by monkeying with a single-payer health care system, but that's a whole different issue. Which ties into the arguments made above* that the problems of Social Security and health care are linked.

*(I recall D.Turtle being very strongly against this)

[The Duchess of Zeon]

Yeah, that's the maximum social security payout, which a successful professional making around 150k a year from age 30 to age 70 would be able to get, when retiring at age 70 (or 110k a year from 22 to 70, but that's much less plausible). The upper middle class gets a very, very good deal out of social security retirement if they just wait until they're 70 to retire. Most of them do not.

[Surlethe]

When would those people stop being covered by Medicare, Simon, or single-payer (which we may as well assume since we're talking about reform ideas)?

The upper middle class gets a very, very good deal out of social security retirement if they just wait until they're 70 to retire. Most of them do not.

Huh, I thought that the retirement account fiction was a piece of New Deal propaganda. I didn't realize that the pension is actually determined in part by average lifetime income.

[Simon_Jester]

I wonder- the upper middle class often (not always) live relatively sedentary lifestyles; this might contribute to being 'unable' to work earlier and wanting to retire earlier. It may also be related to pressure to retire being applied in white-collar hierarchies. I'd think that most modern businesses would rather write off people over sixty and replace them with brisk young executives (or easily intimidated young interns). So trying to hold on until seventy is a somewhat unrewarding gamble, especially if you're not sure you'll live to see eighty-two or eighty-five.

But that's all speculation.


Anyway, in response to Surlethe, yes, Medicare- but part of the problem is that severely disabled people just can't work, or be confident of working. Social Security is calibrated to a bare-minimum lifestyle, typically for elderly people who have few necessary non-medical expenses in their lives (no kids to put through college anymore, etc.) And it's not unreasonable to assume that most of the elderly will have other sources of savings or income to supplement a Social Security income. Some may not, but at least we're not limiting people to that barebones survival-level income for their entire life.

Applying that same calculation to severely disabled people strikes me as unnecessarily cruel. They're such a small percentage of the population (those who cannot work or must work at severely reduced wages in whatever jobs they can find) that it won't have that much collective impact, I'd think, to push the numbers up away from 25% per capita GDP, I'd think.

[Korvan]

Looking at my family, it's interesting to see the different types of retirement (past, present and future). My paternal grandparents retired fairly early due to sales of land they made over the years. They had a few investments, but never tapped into them, living solely on CPP (Canadian pension plan) and a small income from selling some fruit from their remaining orchard. This was possible for them since they had no debt, grew most of their own food, and just didn't spend much money at all (except for presents for their grandchildren).

My parents were both teachers and retired early with a decent pension as well as a fair bit of money in investments. In fact they would've been quite wealthy if they had done the opposite of pretty much every real estate transaction they were involved with (nothing disastrous, just some missed opportunities). Up until my mom's illness and passing, they took at least one major trip a year.

I started saving early in my career, investing in mutual funds and some GICs. I'm a pretty hands off type of investor and I trust that my brokers and fund managers at least have some idea of what they are doing. My initial goal was to retire at 45 and if it wasn't for the dot-com bust and the 2008 troubles, I'd be pretty much on track. Not that I was wiped out or anything, I'm still ahead of the game, just that a few years were spent recovering from the busts. Losing my job and deciding to head back to school for a PhD have further complicated my retirement plans.

The new plan is to complete my schooling, somehow land an academic job and work till I'm dead. I'm actually glad my whole retire at 45 didn't pan out as I'd likely just spend my days wasting time online waiting to die.

[Straha]

You know, it might just be easier to guarantee a minimum income of 20% or 25% per-capita nominal GDP to every (adult) person in the country and dispense with social security altogether. Then we don't have to worry about disability, early retirement, inflation indexing, retirement age indexing, indexing the pension amount to the age of retirement, and so on.

This. This. This this. This. This needs to be done, is far overdue, and would really truly make a qualitative change all around.



For the rest of the thread, the discussion has ignored the two systemic problems that make this poor preparation for transition into retirement inevitable:

First, modern capitalism builds in the constant demand for consumption, and has set itself up so that national economic vitality is predicated on continuous consumption. The past twenty years of economic policy in the United States has been predicated on maintaining a constant level of individual consumption because without such consumption the international economy falls apart. As such the economy cannot build in any incentive to encourage savings because any such incentive would be ultimately self-defeating. Instead the economy builds in the demand to make people work as long as possible, even at the most menial and superficial jobs, to try and get the maximum 'utility' out of any and every possible source and to encourage continuous desire and consumption. If we're going to seriously talk about enabling people to plan for a secure retirement then we either need to fundamentally change our economic system, or ensure that such stability comes from a source 'outside' the market (i.e. re-distributive taxes in a government pension plan.)

Second, chronic youth unemployment. For the past four years youth (a term I use to mean people under the age of 25 here) unemployment has hovered around 15-20%, which is probably underreporting the actual amount of unemployed persons. While they are unemployed they are denied the chance to develop a credit history, gain the experience necessary in skilled fields, and become more and more unhirable because they don't have an employment history. This experience also leaves them with a 'wage scar', and here I quote the Economist at length:

Research from the United States and Britain has found that youth unemployment leaves a “wage scar” that can persist into middle age. The longer the period of unemployment, the bigger the effect. Take two men with the same education, literacy and numeracy scores, places of residence, parents' education and IQ. If one of them spends a year unemployed before the age of 23, ten years later he can expect to earn 23% less than the other. For women the gap is 16%. The penalty persists, though it shrinks; at 42 it is 12% for women and 15% for men.

The result is that they are literally prevented from being able to plan for retirement at all, and any excess income that they might garner after they become employed often has to go into paying off the debt they accrued in order to survive. What's worse is that this also effects taxes, as long as this unemployment remains the tax base will remain stilted, and smaller than it should be. A smaller tax base means that there are less services to go around, and that retirement benefits will probably need to be cut, making this problem worse and worse (especially if you consider the effect on education spending).

In this light, increasing the retirement age makes things worse, not better, because it prevents young blood from entering into the work force, stilting the tax base and making it impossible for the next generation to prepare for retirement. Instead we should probably be encouraging people to retire early with guaranteed, and ample, benefits so that we can hope to get out of this horrific feedback loop.

[Surlethe]

Anyway, in response to Surlethe, yes, Medicare- but part of the problem is that severely disabled people just can't work, or be confident of working. Social Security is calibrated to a bare-minimum lifestyle, typically for elderly people who have few necessary non-medical expenses in their lives (no kids to put through college anymore, etc.) And it's not unreasonable to assume that most of the elderly will have other sources of savings or income to supplement a Social Security income. Some may not, but at least we're not limiting people to that barebones survival-level income for their entire life.

I don't see a problem with people being unable (or unwilling) to work. That's kind of the point of having a guaranteed minimum income: you ensure that nobody's going to die (unless they're stupid). If people are so severely medically disabled that they can't live on their own, well, let them stay with family or let the medical system take care of them. As you point out below, there are so few such people that (I'd conclude) it's not reasonable to alter the entire system for them.

Applying that same calculation to severely disabled people strikes me as unnecessarily cruel. They're such a small percentage of the population (those who cannot work or must work at severely reduced wages in whatever jobs they can find) that it won't have that much collective impact, I'd think, to push the numbers up away from 25% per capita GDP, I'd think.

I think you're backwards: they're such a small percentage of the population that they don't justify changing a proposed minimum living income. Instead, people with severe disabilities should qualify for medical assistance through Medicaid (or, better yet, through Medicare-for-all).

[Surlethe]

This. This. This this. This. This needs to be done, is far overdue, and would really truly make a qualitative change all around.

One of the big reasons that the US is so hostile to poor people is that there are so many overlapping regulatory regimes and means-tested programs that people moving out of poverty face implicit marginal tax rates well above what any millionaire pays. They sometimes exceed 100% -- for instance, before #2 was born, if our family income had increased by $4000, we would have lost our daughter's $400 Medicaid and had to replace it with a $5000 premium increase on our employer's health insurance plan. Streamlining the welfare and tax system -- both removing government-imposed barriers to success and eliminating gaps in the safety net -- is probably, on the margin, the best thing we can do in the US to fight poverty.

I disagree with your assessment of modern capitalism, but I don't have time to get it right now. I may come back to it later.

[The Duchess of Zeon]

The result is that they are literally prevented from being able to plan for retirement at all, and any excess income that they might garner after they become employed often has to go into paying off the debt they accrued in order to survive. What's worse is that this also effects taxes, as long as this unemployment remains the tax base will remain stilted, and smaller than it should be. A smaller tax base means that there are less services to go around, and that retirement benefits will probably need to be cut, making this problem worse and worse (especially if you consider the effect on education spending).

In this light, increasing the retirement age makes things worse, not better, because it prevents young blood from entering into the work force, stilting the tax base and making it impossible for the next generation to prepare for retirement. Instead we should probably be encouraging people to retire early with guaranteed, and ample, benefits so that we can hope to get out of this horrific feedback loop.

I don't think that can save us; the magnitude of the problem is much worse. I think only legislated inefficiency can, at which point all labour in the country including that of healthy elderly people will be necessary. Broadly, I think efficiency gains may be producing a post-scarcity workforce distribution without actual post scarcity, and that structural unemployment in the current capitalist system may start to rapidly rise throughout the 21st century, and may have already done so. Since technological and social progress are not actually harmed by manufacturing inefficiency (to this day even the most advanced prototypes in the world are basically handbuilt, not on a production line), continuous improvements in efficiency provide only profits for the highest level of capitalists, and improved warmaking capability. I would argue neither one is really necessary.

[Simon_Jester]

Legislated inefficiency should be something we can calibrate, at least roughly to within acceptable limits. Suppose we're trying to counter a structural unemployment rate of 25%. Mandate 30-hour work weeks instead of 40, let four workers do the work of three. The structural employment problem goes away without it being necessary to find makework for septuagenarians. We'd only need them again if we decided to further cut the work week beyond what's necessary to get rid of structural unemployment.

If we're not legislating inefficiency, then early retirement becomes all the more urgent and pressing a problem. It's disastrous to keep Generation X working in their jobs to age 75 if that means Generation Y faces severe structural unemployment until age 50. Because then who the hell is paying for Generation Z's housing and college educations?

I'd much rather have 65-year-olds unemployed and 25-year-olds working, than have it the other way around. I don't mind individual exceptions to that rule, but as a general principle it just serves to lock in a gerontocracy and to destroy the nuclear-family model of parents caring for children instead of grandparents.

[The Duchess of Zeon]

Legislated inefficiency should be something we can calibrate, at least roughly to within acceptable limits. Suppose we're trying to counter a structural unemployment rate of 25%. Mandate 30-hour work weeks instead of 40, let four workers do the work of three. The structural employment problem goes away without it being necessary to find makework for septuagenarians. We'd only need them again if we decided to further cut the work week beyond what's necessary to get rid of structural unemployment.

If we're not legislating inefficiency, then early retirement becomes all the more urgent and pressing a problem. It's disastrous to keep Generation X working in their jobs to age 75 if that means Generation Y faces severe structural unemployment until age 50. Because then who the hell is paying for Generation Z's housing and college educations?

I'd much rather have 65-year-olds unemployed and 25-year-olds working, than have it the other way around. I don't mind individual exceptions to that rule, but as a general principle it just serves to lock in a gerontocracy and to destroy the nuclear-family model of parents caring for children instead of grandparents.

I think the problem is that we are reducing employment at the same time we need more employment to effectively pay taxes for the social services we provide; in short, my concern is that the focus on youth unemployment avoids the fact that we are heading into a retiree-centric elderly culture due to changing demographics. Basically, congratulations: We're burning both ends of the candle. For structural reasons it may be possible for us to simultaneously be suffering from an excess of workers and a shortage of workers. (i.e., we're at a level of employment demand which requires fewer people, but we're living in a tax and welfare structure that demands more).

[Simon_Jester]

In that case the problem is in the tax structure, not the labor supply- and since tax policy is easier to change gracefully, a wise government would concentrate on that.

In the US, Social Security per se isn't really the problem; there are not and cannot be that many retirees. By 2020 (for instance) a large fraction of the retiring early boomers (born 1946-48, the immediate postwar babies) will be dead. Not a majority of them, but quite a few. They will not present a problem in the indefinite long term. Worst case, we'd have to enact means testing and take the cap off social security taxes in the US to cope with the demographic crisis.

Of course, the US enjoys a happy position in that it's got masses of immigration and second-generation immigrant births keeping the population above replacement rate. So the workforce will always seriously outnumber the retirees for any plausible retirement age, for the indefinite future. Europe and Japan have a different kind of problem because they have less (or effectively no, for Japan) immigration and thus their population isn't growing at replacement rate: middle-aged people will be retiring faster than youths enter the workforce. So we have to distinguish whether we're talking US policy, EU policy, or the policy of other countries around the world.

The real killer in the US is health care costs, and there are a lot of ways to fix that. Single-payer is only going to get more popular if Obamacare doesn't lead to drastic decreases in costs, for one. And bringing US health care cost per capita down to something in line with the rest of the developed world would provide huge economic relief and make the welfare state as we know it far more sustainable. In the worst probable case, we may have to make a collective choice not to make a last-ditch effort to extend the lives of octogenarians at a cost of tens of thousands of dollars per month lived on a hospital bed. But ultimately it wouldn't destroy our civilization to do that.


So no, I don't think we urgently need more taxpayers to keep the welfare structure running. We need a different tax structure, but it makes far more sense to reform the taxes and I think within another ten years or so the political situation will make this palatable.

Within the present tax structure, of course we do face this huge perverse problem you identify. We've got unemployable 25-year-olds and 70-year-olds who have no choice but to work until they die. But it would be a mistake to treat that system as eternal, in the face of demographic pressures that are only going to get more intense.

[The Duchess of Zeon]

I disagree that the problem is so simple, because the tax structure needs more taxpayers to cover retirees since retirees are living longer, but industrial efficiency is reducing the required number of workers. In short, we need fewer workers to achieve a certain level of economic production, but we need more workers to support the increasing lifespans of retirees.

Now, the obvious thing to do might be, "but if production is increasing, why not just tax it higher so that businesses are paying for the retirees rather than workers". The serious problem with that is that, though US taxes are massively undervalued, and we could literally triple the capital gains tax with no ill effect and double the income tax for people making more than 100k a year across the board; that probably isn't enough money in the long run (which tells you just how bad off we are right now when people think taxes should be even lower) to actually support the current trends. So, the short term solution is to triple the capital gains tax to 45% from 15%. The long term solution however is ??? ; we don't have any viable one at the moment, short of our either maxing out efficiency gains and lifespans.

The reason we can't just keep increasing taxes is that the Laffer curve actually applies above 48% of total income being taxed (there was a Stanford study), so we'll depress economic productivity once we exceed that cutoff by high enough that the depression in desire to work equals out to the increased revenue, we will receive no further revenue increases from further taxation. So somewhere between 48 - 60% of individual income is the maximum government tax take, from which we have to supply retirees and unemployed youth. Once the combined requirements of retirees and unemployed youth as well as healthcare and all other government functions exceed about 50% of GDP, the system breaks down.

[Junghalli]

I don't think that can save us; the magnitude of the problem is much worse. I think only legislated inefficiency can, at which point all labour in the country including that of healthy elderly people will be necessary. Broadly, I think efficiency gains may be producing a post-scarcity workforce distribution without actual post scarcity, and that structural unemployment in the current capitalist system may start to rapidly rise throughout the 21st century, and may have already done so. Since technological and social progress are not actually harmed by manufacturing inefficiency (to this day even the most advanced prototypes in the world are basically handbuilt, not on a production line), continuous improvements in efficiency provide only profits for the highest level of capitalists, and improved warmaking capability. I would argue neither one is really necessary.

Using the improved efficiency to allow us to as a society afford more liesure time (which would probably in practice mean mandating short working hours and weeks, earlier retirement etc. combined with high pay) strikes me as a much preferable solution to deliberately maintaining inefficiency so that everybody can keep running in those hamster wheels, and I don't really see how it's any more idealistic than your solution. The problem you seem to be touching on is capitalism's inherent institutional incentive to squeeze as much work as possible out of as few workers as possible, combined with a cultural mindset hostile to non-workers and a society where it increasingly no longer makes sense to have people doing so much work because of advancing technology (the "postscarcity society without the postscarcity" part). Both your solution and mine are going to clash with the first dynamic, and if you're going to go big it kind of seems to me you might as well confront the root of the issue head-on, instead of slapping in a patch to keep the "every able-bodied person works full time" system going.

Mind you, I'm not convinced we're getting to the "endless high employment because of technology" point yet, IIRC people have been predicting that for a long time and it hasn't been happening for a long time. But I'm just going with it as an assumption here, as this strikes me as a discussion worth having.

Can you explain why you think mandating inefficiency is more realistic than mandating less work?

[The Duchess of Zeon]

Can you explain why you think mandating inefficiency is more realistic than mandating less work?

Because individual psychology demotivates further production after the government starts taking more than around 50% of your earnings, no matter the amount you are earning. So without major alterations to human psychology, the concentration of capital caused by increasing productivity with a reducing number of workers will yield a reduction in economic output because the individual tax burden will rise above the point where individual humans reduce their output.

That is to say that, psychologically, even if they can afford to pay 95% tax and still live comfortable and rich lives, the mega-rich running the automated factories will not do so. The most we can possibly hit them for is probably around 55 - 60% of their income, and if capital becomes so concentrated that this level is no longer sufficient to pay for the benefits to youth and retirees, then we still hit the crunch. We must prevent the concentration of capital enough so that the psychological limit of taxation for sustained human productivity does not have to be exceeded in any one income group for us to maintain all necessary social benefits.

In short, benefits demand increases and efficiency gains collectively lead to capitalism becoming unviable beyond a certain point, so you have to eliminate capitalism entirely and replace it with something else, or you have to redistribute capital and thus the tax base across a broader spectrum of society. Forced inefficiency is a way to do this.

[Broomstick]

I'd much rather have 65-year-olds unemployed and 25-year-olds working, than have it the other way around.

The problem is that the way the system is currently structured, or likely to be structured, that leaves 65 year olds in grinding poverty in all too many cases.