The latest issue of Bloomberg Businessweek offers another bit of bad news for those (this means you, Thomas Friedman) who praise China’s authoritarian government because of its ability to “get things done.” It seems the communists have yet to find a five-year plan that would help them devise a viable public pension system.
When a Beijing professor recently suggested pushing back the age at which retirees get their pensions, China’s bloggers let loose. “You’re indeed completely without conscience, a mouth filled with poison and cruelty, your heart that of a beast,” wrote one blogger from Shenyang, in Liaoning province, on the online portal Sohu.com, according to ChinaSMACK, a website that translates Chinese Internet content. “The clamor to postpone the retirement age is getting louder, a raging fire burns in my heart,” wrote another from Jiangxi province. “Tsinghua University truly has raised a bunch of garbage professors,” wrote a blogger from Guangdong, referring to Yang Yansui, director of Tsinghua’s employment and social security institute, who raised the idea.
The heated responses reflect the crisis faced by China’s pension system. A shrinking workforce must support more than 200 million retirees. The government has moved in the last few years to add farmers, the unemployed, and migrant workers to its pension rolls, which now cover more than four-fifths of those registered in cities and 43 percent of rural Chinese.
When top officials gather in Beijing on Nov. 9 to map out the next set of reforms, solving the pension crisis could well be high on their list. Last year for the first time, the working-age population—those 15 to 59 years old—declined, falling by 3.5 million to 937.3 million. People older than 60 make up 13 percent of the population. By 2050 that number will rise to 34 percent, estimates the World Bank. Today an average 4.9 Chinese of working age support one retiree. That ratio could fall to 1.6 by 2050, estimates Robert Pozen, a senior lecturer at Harvard Business School.
