An economy ready to retire

Alisa Roth May 29, 2007

TEXT OF STORYLISA NAPOLI: The Organization for Economic Cooperation and Development has a report card out today on the state of the U.S. economy. Alisa Roth has details.


ALISA ROTH: The new report says the biggest challenge for the U.S. economy can be summed up in just three words: Baby Boomers’ retirement.

General economic growth as well as job growth are slowing down, in part because there aren’t enough new workers to replace those who are starting to retire.

Among other things, that means less tax revenue while higher Social Security and health care costs mean the government will be spending more.

HANNES SUPPANZ: This is problematic because there are strong demographic pressures starting right now with the retirement of the Baby Boom population and this will increasingly lead to higher budget deficits.

Hannes Suppanz worked on the OECD’s report. The report also says the U.S. will face a budget crisis if it doesn’t do something about health care spending.

The report suggests several fixes, including upping the retirement age and making access to higher education easier.

In New York, I’m Alisa Roth for Marketplace.

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