The IMF and World Bank Group will meet in October in Tokyo for their annual meeting – and when they do, they have an opportunity to achieve what the G-20 missed last week. When it comes to discussions of fiscal sustainability and economic growth, leaders in Tokyo can argue for innovative public policy that unleashes the economic potential of the globe’s aging populations – something President Obama did not do.
In Cabo last week, the president could have reasserted American leadership and offered a novel pathway to the world’s growing economic woes. He could have argued that, just as the women’s movement helped grow the American economy in the 20th century, today’s global aging population can drive economic growth in the 21st century.
Today’s 450 million global baby boomers are the world’s greatest untapped economic resource; there will soon be two billion people over the age of 60. The G-20 could have begun to align economic and fiscal policy with this impossible-to-ignore 21st century fact – and helped this demographic move from dependence to economically active and productive status. Since many G-20 nations will soon have over a third of their populations over 60, it is imperative to find new health, education, and “retirement” policies to transform this segment into a driver of growth.
A number of the president’s G-20 counterparts are already working on the “aging issue.” The Japanese, officially the world’s oldest population, released a cabinet policy paper last week arguing that Japan “needs to realize a society where aging people can participate in the labor market or in social activities… to boost its economic growth.” The Europeans dedicated 2012 as the “Year of Active Aging.”
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The BRIC nations and others in the developing world are aging at an even more rapid pace than Japan, Europe, or the U.S., and their leadership is taking note. The Mexican Minister of Health, for example, endorsed the U.N.’s project on non-communicable diseases as essential to enabling a healthier and therefore productive aging; China has placed aging at the heart of its latest five-year plan; and when it comes to Brazil, whispers are already circulating of the first “Age-Friendly” Olympics in 2016.
Just a few short decades after women were economically enfranchised in the U.S., they now add nearly $3 trillion to the economy. Female-owned businesses employ nearly 16 percent of the workforce. If American women-owned businesses accounted for its own economy, it would have the fifth largest GDP in the world. The parallel to today’s global disenfranchisement of older adults is clear: The traditional paths of retirement and dependence are robbing the global economy of full growth capacity.
At the G-20, President Obama could have drawn from the compelling precedent set by his own administration. Under American leadership last year, the Asia Pacific Economic Council embedded aging populations in its 2011 ministerial pronouncement. Undersecretary of State Robert Hormats later said, “We need a focused, society-wide effort to transform our vision of aging from a time of dependency to a time of continued growth, contribution, and social and economic participation.”
Kathleen Sebelius, U.S. Secretary of Health and Human Services, furthered the theme at the Pan American Health Organization’s celebration of Population Aging this past April when she said, “By keeping our seniors healthy and engaged, we [begin] to write a new story… in which every nation will have more productive workers… and every nation thrives.”
Today, the idea of “every nation thriving” may seem like a pipe dream, especially with Greece, Italy, Spain, Portugal, and others at financial risk. But great leadership can make the ostensibly impossible feel attainable. As the globe’s population continues to age each day, we’ll look toward Tokyo with hope – it’s the only thing to do.
Michael W. Hodin, Ph.D., is Adjunct Senior Fellow at The Council of Foreign Relations and Executive Director of The Global Coalition on Aging.