So those born after 1945 will have a much higher life expectancy. Those born from around 1960 onward, during the economic boom, even more.

Bye bye financial system.

'bye bye financial system'? why not increase the retirement age in line with the life expectancy...

or perhaps with the continued increase in economic efficiency the young will be more easily able to provide for the old... (that instead of having increased unemployment associated with increasing the retirement age...)

Orathaic,
Basically I'm assuming that given both the "extreme right" (which to me is just an anti-immigration extreme left) and the left are opposed to such measures in various countries in Europe although obviously, it is the first measure any government should take in these times, these proposals will be voted down for purely sentimental reasons.

Why not stop having the government take care of old people IN GENERAL and instead have people work until they've built up a nest egg large enough to take care of them for the rest of their lives and only then retire whatever age that is. The better one's own financial planning and ability to work and save, the earlier that is. I say "in general" because of course there will be those who will need to be taken care of, but we need that to stop being whatever large percentage it is.

Absolutely. That's what we should do. Except in Europe, we don't. Many people hate working so much that the promise that was made to them that they could stop working at 65 or 63 or whatever it used to be has become the pillar on which their whole existence was based.
The point is, this growing group doesn't just live long. They keep voting while they do so.

so only have the government take care of people who can't afford to take care of themselves (because they can't make enough money, whether that be because they are disabled, too old, too young, or whatever else excuse?)

well on the face of it, this creates something of a separate class of people, as determined by government guidelines, or whose work is not valuable, rather than letting the market decide.

It's like say 'oh your not well enough to be productive, so we will pay your way'

i bet Stephen Hawking would qualify for this kind of scheme...

In my mind, a better way would be to guarentee everyone is looked after, and then use income tax increases to take back what we currently don't give to the wealthy (so for example, in Ireland everyone would get €188 per week, regardless of income, health, employability etc. and those who are working would lose €188 worth of tax credits.)

tada, financially the same system, but you don't ask the government to determine whether someone is well enough to work/retire. Removing the burden both of legislating for this and making sure nobody is cheating the system or other enforcement (which is mostly paper work for anything which requires a mean testing)

That's not precisely what Alderian proposed nor what I agreed to. Anyway most important of all: move up the age at which you can retire. Much of today's financial crisis could be resolved if we just make a huge correction there. I've seen examples in my personal environment of people working when they're well over 70 and they are fitter, more interesting people than the ones who stopped.
I actually think retirement turns out to be a delusion for people who loved what they were doing and makes them realize that maybe they loved it more than they are willing to admit, but keep up appearances and mown the lawn until they need a microscope to determine if the grass has grown since they did so last time...

What about the immediate increase in unemployment?

are you just going to turn a problem of retirement costs into a problem of unemployment costs?

Will young people who can't fill the places which the retirees no longer open up simply have to wait another 5-10 years to get jobs?

I don't really think your solution has legs, even though i agree with in principle...

And that may not be what you agreed to, but what comment can you add?

A) we should not care for people who are unable to take care of themselves. (or they can hope charities are able to cope, or their families are wealthy enough to take care of them)

B) the government should determine what a person is able for, because otherwise they will try to take advantage of the system

C) something else?

I'm not too worried about unemployment. My country (NL as you know) is to my best knowledge still admitting Poles and Rumanians to do the work we believe ourselves to be too good for.
And as for what comment I would add, is that I would agree with Alderian on the point where he says that it is important that pensions become very much something that people build up during their working lives, and much less something the government takes care of.
Personally, the way I see it now and have for some time, I hope I won't live to see my own retirement day. To become "obsolete" from one day to the next seems ridiculous at this point in my life.

I believe in ireland the government runs a national pension fund, to which people contribute during their working lives, thus to cover the eventual cost of paying pensions the government adds a pension tax to all income.

Whether you also contribute to a private pension fund is a personal choice.

Is it being a government run fund to which everyone must contribute that much different? Oh yes, the amount you accumulate doesn't affect when you retire as in Alderian's suggestion, also...
I also believe that the Irish government is currently investing this massive pension fund into irish banks... to reduce the amount of borrowing the government needs to do in order to stabilise the situation. (most of the poles have, i think, gone home, because to large number of jobs in the building industry have dissappeared, however there are still other eastern europeans doing the jobs most irish people would not take)

Actually I interpreted what A. said as implying a shift from the public to the private domain, which I support, the way you interpret it (and you're very possibly right there) I wouldn't agree with it. The government should pay a very minimal amount of money and people should definitely save privately apart. Plus the retirement age has to start going up rapidly in all of Europe. (read: Mediterranean countries)