This site is back. Me, too! Gladwell’s The Risk Pool
This site (edublogs.org) was down for a while, causing much consternation to those teachers and students who depend on it.
Didn’t affect me much. Been up to my armpits in alligators with the usual start-of-the-year school stuff. Now I hope to have more time to read and write….
The Risk Pool: In a recent New Yorker article, my main man Malcolm has written well (per usual) and provocatively (per usual) about how the ratio of those who work to those who don’t is a very good predictor of economic success, whether you’re looking a country’s economy or looking at General Motors. A country can be burdened with too many children to care for or with too many elderly to support. A company can be burdened by its obligations to retirees, generally in the form of pensions or health insurance. As an example, Gladwell attributes Ireland’s recent success to the fact that Irish women are having fewer children:
This relation between the number of people who aren’t of working age and the number of people who are is captured in the dependency ratio. In Ireland during the sixties, when contraception was illegal, there were ten people who were too old or too young to work for every fourteen people in a position to earn a paycheck. That meant that the country was spending a large percentage of its resources on caring for the young and the old. Last year, Ireland’s dependency ratio hit an all-time low: for every ten dependents, it had twenty-two people of working age. That change coincides precisely with the country’s extraordinary economic surge.
He also shows how the big auto companies in the U.S. are heavily burdened by their retirees — so much so, that it is nearly impossible for them to succeed.
In 1962, G.M. had four hundred and sixty-four thousand U.S. employees and was paying benefits to forty thousand retirees and their spouses, for a dependency ratio of one pensioner to 11.6 employees. Last year, it had a hundred and forty-one thousand workers and paid benefits to four hundred and fifty-three thousand retirees, for a dependency ratio of 3.2 to 1.
