A searing look at the fiscal crisis of an ageing society, corporate corruption, fund skimming and tax breaks, with new proposals for pension provision.

The advanced countries of the Global North are facing an ageing crisis. The ever-increasing human life span, the postwar baby boom, and the subsequent rise in birth rate mean, for example, that the UK population of those over age 65 will double by 2032 — to 24% of the population. The provisions the British government has assembled to care for the needs of the elderly are failing. Pension wealth is declining, employer-sponsored retirement programs are freezing, and mutual funds involve high charges and weak returns.

In Age Shock: How Finance Is Failing Us, economist and historian Robin Blackburn offers a progressive voice to the politically divisive conversation surrounding pension wealth. Blackburn argues that corporate reform and modification of the free market system are essential to improving the conditions of the ageing society.

The last few years have shown how badly the financial services industry performs as a custodian of savings and pension funds. The “skimming” of US mutual funds, the see-saw of the stock markets, and a string of business scandals from Enron to Parmalat have wiped billions from the savings of employees on both sides of the Atlantic. They have also exposed the absence of responsibility at the heart of what Robin Blackburn calls “grey capitalism.”

Here, Blackburn takes forward the argument of his acclaimed Banking on Death - Or, Investing in Life: The History and Future of Pensions and explains why attempts to meet the costs of the ageing society through a proliferation of financial products are doomed to fail and have a host of unfortunate side-effects. In fact, “financial engineering,” as it is called, has allowed corporations to escape taxation while allowing a new breed of chief executive to accumulate extravagant fortunes at the expense of shareholder and employee alike.

The author does not just expose problems, however; he also explores solutions. Blackburn identifies new sources of pension finance — especially ways of ensuring that corporations make a real contribution — and sketches the shape of a progressive and responsible pension fund regime, embracing all citizens and accountable to them.

Praise for Banking on Death:

“Blackburn’s views seem to me refreshing ... [He] acknowledges that there are real strains on the old welfare state and proposes interesting ways to handle them that do not resort to simplistic formulas of privatization.” — Jeff Madrick, New York Review of Books

“... required reading for all those interested in the pensions industry. That is, all of us.” — Barry Marshall, Public Service Review: Finance

“One of the best books I have read on pension funds.” — Independent

“Blackburn is particularly good at disentangling the different dynamics that make the pensions problem so intractable for mature, ageing economies.” — Sir Howard Davis, Director, FSA, Guardian

Robin Blackburn teaches at the Graduate Faculty of the New School University, New York, and in the Sociology Department of the University of Essex. He is the author of Banking on Death: Or, Investing in Life: The History and Future of Pensions, as well as The Making of New World Slavery and The Overthrow of Colonial Slavery.

336 pages

Cloth
ISBN-13: 978 1 84467 013 0
£19.99 / US$34.95