ELDR Focus Year 2010 by ALDE Party

In 2010, the European Liberal, Democrat and Reform Party (ELDR) chose to focus its attention on the challenges of demographic change in Europe. The “Focus Year” initiative was thus born, to offer a European platform for debate on how to tackle, from a liberal perspective, some of the most crucial issues for Europe’s future – the challenges of a rapidly ageing society. This debate primarily took place on the special website and comprised a number of contributions from the local, national and European level on a wide range of topics under this overarching umbrella. This website fuelled discussion and ultimately culminated in the adoption of a comprehensive Theme Resolution at ELDR’s 31st annual Congress in Helsinki, Finland in October 2010. In this booklet, you will find a summary of our findings, comprising both the Theme Resolution, which holds concrete, liberal policy recommendations on how to make the most of these challenges – as well as some excerpts from the preceding debate and opinion pieces from academic authorities that are leading the global debate on these issues. To revisit the debate on the challenges of demographic change, please visit www.eldrfocus2010.eu European Liberal, Democrat and Reform Party Brussels, December 2010

Focus Year 2010 Demographic Change Moving beyond boundaries

Table of Contents

Preface. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Theme resolution: liberal responses to the challenges of demographic change . . . . . . . . . . . . . . . . 7 Professor Jack A. Goldstone: Liberal solutions to a global problem: demographic change and the future of Europe. . . . . . . . . . 11 European Commissioner Olli Rehn: Ageing is a major policy challenge, but not insurmountable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Barbro Westerholm MP: Interview with Swedish MP Barbro Westerholm. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Jan Kees Wiebenga: European migration policy: the need for fairness and balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Britta Reimers MEP: Demographic change in rural areas and agriculture – adaptation instead of counteracting . . . . . . 25 European Commissioner Cecilia Malmström: Why Europe needs to increase legal immigration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 European Commissioner Androulla Vassiliou: Young people – a strategic asset for Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 ELDR Party President Annemie Neyts-Uyttebroeck MEP & Network of Arab Liberals Former President Mohammad Tamaldou: Liberal migration policies – taming the paper tiger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Preface The rate of European population growth is falling while simultaneously the percentage of the population that is over the age of 65 is increasing constantly and anticipated to be 22.4% by 2025 – a significant rise from today’s (2010) 17%. Europe is thus faced with serious challenges to maintain its competitiveness globally as well as its prosperous society. The very nature of Europe’s demography is changing. We have new questions that need new answers and new solutions. Demographic change is happening all around us. In a European context, demographic change and an ageing population are considered almost as synonyms. Decreasing birth rates and increased life expectancy are transforming our natural demographic pyramid into a more barrel like structure. But despite this change, many urban places in Europe have a rising amount of children reaching school age. South of Europe, in developing countries, the opposite patterns are emerging. These societies struggle to create enough jobs to keep their young women and men in their country. Many leave for Europe in search of better lives. East of us in China the one child policy means that fewer adults of working age have to take care of a larger amount of older people. And India’s preference for male babies is going to lead to gender balance problems in the future. Questions of demographic change are long-term issues that all require action to be taken today. Much is at stake; what type of social security systems, health care and pension provisions we need, want and can afford; migration and immigration policies that are to the benefit of individuals and member states; as well as labour market policies. How do we achieve them? What we are faced with is a unique European phenomenon that needs a long-term European solution. That is why ELDR

decided to launch a Focus Year discussing and presenting long-term liberal solutions on this very important and current issue. After a year of interesting in-depth focus and discussions, notably at the special webpage dedicated to questions related to demographic change www.eldrfocus2010.eu and the theme of the ELDR Congress in Helsinki, European Liberals are now prepared to tackle these issues. This booklet aims at summing up this debate and providing Liberal Answers to the Challenges of Demographic Change. I hope you will find it interesting and rewarding.

Annemie Neyts-Uyttebroeck MEP European Liberal, Democrat and Reform Party President, Minister of State 7

Liberal responses to the challenges of demographic change

Summary of key liberal demands

1. Maintaining European economic competitiveness • Sustainable and flexible pension schemes are needed to allow older people to voluntarily work longer if they so wish. Mandatory retirement ages should be abolished; • Combating youth unemployment is vital. Europe needs more, not less, input and entrepreneurship from young people. 2. Making the most of Free movement • Demographic challenges can be overcome by enhancing the flexibility and openness of the European labour market, which will simultaneously help to improve Europe’s competitive advantage in a globalised society; • Europe needs to address migration and asylum in a coherent way through the Blue Card Scheme and provisions of the Stockholm Programme. The economic goals of the EU also depend on successfully attracting skilled migrants. 3. Averting an inter-generational battle • There needs to be investment in education and the youth, as well as a commitment from European governments to balance their budgets and to cut down on borrowing. 4. Finding new ways to integrate and prosper on the world stage • An EU-wide strategy for combating the conflicts outside Europe’s boundaries, as well as removing trade barriers, is important for a better business climate and brighter future for young people in troubled states; • A larger investment in education, training and sharing of best practices for people from developing countries living in EU Member States will improve the integration process and enhance immigrants’ possibilities to prosper in society.

Liberal Responses To The Challenges Of Demographic Change

Population pyramids (in thousands), EU27 in 2008 and 2060 Age groups

Men

Women

90+ 85 - 89 80 - 84

Introduction

75 - 79 70 - 74 65 - 69 60 - 64

Demographic change has not happened overnight. However, without policies to address these issues now, many EU Member States will quickly realize that their economies are less productive; health care systems unbalanced and state pensions systems in crisis.

55 - 59 50 - 54 45 - 49 40 - 44 35 - 39 30 - 34 25 - 29 20 - 24 15 - 19 10 - 14

This is particularly alarming for Europe’s youth, who are bearing the brunt of the economic downturn. The ELDR Party wants to see concerted action taken to avoid the emergence of a lost generation. Furthermore, the questions of flexible work-market solutions, free movement and migration are also heavily linked to demographic change. European Liberal Democrats consider properly managed migration, in combination with a vibrant and open European work market, to be some of the key components in ensuring future welfare. In dealing with these challenges, the ELDR Party has identified four main areas that need to be improved in order to properly address this pressing issue.

Economic Impact of an Ageing Society Healthy ageing is in principle a very good thing, and something we have deliberately pursued in modern times but we also need to consider its economic and societal consequences. Low European birth rates in combination with the ageing and approaching retirement of the so called ‘baby boom generation’

5-9

EU27 2008 EU27 2060 20 000

15 000

0-4 10 000

5 000

10 000

15 000

20 000

Source: 2009 Ageing Report. Economic and budgetary projections for the EU-27 Member States (2008-2060). European Commission, Directorate General Economic and Financial Affairs

The following text is a condensed version of the ELDR Party theme resolution adopted in Helsinki, Finland on 15 October 2010.

born after World War II, mean Europe’s workforce could, unaddressed, soon become significantly reduced, which in turn poses a real threat to our economic competitiveness, productivity and service provision. Therefore, European Liberals consider that European countries need to urgently reform their pension schemes and facilitate citizens’ ability to secure income through a combination of state, employer and private funds, More flexibility in the labour market is needed and mandatory retirement ages should be abolished. This would be to the benefit of already retired people, who if they so wish, could work to supplement their retirement income. We also believe that society should increasingly make use of recent technological advances. Today, there are a range of internet-based “e-services” available, which could work well to reduce unnecessary bureaucracy and ensure services for elderly people and enable them to stay longer in their own homes.

All of these measures for the ageing part of society need to be complemented by strategies for combating youth unemployment. What Europe needs is more, not less input and entrepreneurship from young people.

Free movement, Immigration and Social Cohesion Median age of collective population in years 50

2050

The Stockholm Programme defines the framework for EU police and customs cooperation, rescue services, criminal and civil law cooperation, asylum, migration and visa policy for the period 2010–2014.

1950

Africa

Asia

Europe

Latin North America America

Source: Tivig, T., Hetze, P. (2007), Deutschland im Demographischen Wandel, page 11

2000

There is also a need to address the questions of migration and asylum in a coherent way. Therefore, European Liberals support the development of a comprehensive and sustainable European migration and asylum policy framework.

European Liberals consider free movement of people a key element of European integration and prosperity. Therefore, we call for harmonizing the rights of all EU citizens, notably implying that all citizens gain the right to work across the Member States of the EU. In order to ensure continued prosperity in a globalised world, we see a pressing need to achieve a fully functioning and flexible European single market – with a current prominent example being the health care sector, where we see the urgent need to further coordinate actions and develop e-health initiatives, to tap the underlying potential, shorten queues and thereby reduce health costs for millions of Europeans.

To ensure longer term measured economic integration, we support the development of a so-called European Blue Card Scheme in line with the ambitions of the European Union’s Stockholm Programme. There are few doubts that successful attraction of skilled migrants is fundamental in helping to reach the Union’s economic goals.

Inter-generational Dimensions of Demographic Change The practice of accumulating ever-higher amounts of public debt by governments across Europe is extremely alarming and a virtual time-bomb for coming generations. European Liberal Democrats stress that this trend needs to be reversed – otherwise the youth of today will risk being buried in debt before they have even had the chance to start earning money. Cruelly highlighted in the wake of the financial crisis - states should be focusing on reducing government expenditure in terms of GDP and to put forward balanced budgets, instead of accumulating debt. We acknowledge that high unemployment across the EU is primarily to be found in the 18-24 and 50+ age ranges.

Liberal responses to the challenges of demographic change

However, early retirement, which is often proposed as a short-term response to unemployment, does not constitute a credible response. Doing so only partially alleviates the burden – but it does nothing to enhance productivity, entrepreneurship and thereby tackle the root causes of the current situation. People who remain active in society for longer, will lead a healthier life and achieve a greater sense of well-being. Therefore, European Liberals encourage Member States and the EU itself to invest more in education at school age levels and more broadly to improve education levels among young adults across Europe. Europe will in the future depend even more on highly educated people and less on the blue collar sector. Individuals must have the right of self-determination over how they live their lives. In that vein, European Liberals call for an enhanced child- and family-friendly working atmosphere, in particular comprising the extension of flexible working practices, including home-working, as a means to allow people to fulfil their work and private commitments to meet their individual needs.

International cooperation In today’s globalised world, Europe cannot successfully act alone. Whether Europe wants it or not, conflicts beyond the EU’s borders have repercussions on the realities of European countries, inter alia through increased migration flows. European Liberal Democrats note that the current pace of immigration to certain EU Member States is of high concern and has the potential to undermine internal social cohesion, unless properly handled. As the EU is a large continent with easily accessible borders, it is important that these issues are tackled on an EU-wide scale.

In addition to supporting the creation of a comprehensive European action plan for migration and asylum issues we also believe that cooperation in combating the root cause of conflicts outside Europe’s borders and removing trade barriers can significantly contribute to a better business climate and a brighter future for the youth of troubled states. Europeans need to contribute with core issues of what has made our own continent flourish through capacity building, training and sharing of best practice. As liberals, we have a natural belief in people’s own abilities and powers, and we trust that giving them the opportunities to study, and thereby tools to prosper, they will create a situation which is beneficial for both their own lives and Europe’s prosperity as a whole. Therefore, the ELDR Party calls on governments to enhance education and training in EU member states for people from developing countries. We believe that this will significantly strengthen the pace of integration and reduce misunderstandings between people.

To see the full version of this policy paper, visit the ELDR website, www.eldr.eu

Liberal solutions to a global problem: Demographic change and the future of Europe

Professor Jack A. Goldstone â&#x20AC;˘ 30 November 2010 Europe today is struggling with its finances, as the fallout from the Great Recession threatens to swamp banking systems and state budgets from Athens to Dublin. The long-term solution to this problem is two-fold: restoring economic growth, and restraining government spending. Yet both of these aims, as well as broader concerns about international security and world-wide economic development, will depend upon how Europe faces the challenges of global demographic change. Over the next 40 years, an ageing and in some places shrinking Europe will be engageing rapidly growing and relatively youthful societies in Africa, the Middle East, Latin America and Asia. Whether this conjunction is seized as an opportunity, or becomes a dangerous threat, depends on how European nations, and their allies, shape their policies in the next few years.

Population megatrends The most critical trends in global demography can be summed up in the following four points: 1. There will be a major shift in global economic growth potential to the developing world.

Jack A. Goldstone was the guest key note speaker at the 31st annual ELDR Party Congress in Helsinki, Finland, 13-15 October 2010

The developing countries of the southern hemisphere, Middle East, and South Asia are now undergoing the same kinds of basic social changes that drove rapid economic growth in the West over the last two-hundred years: a rise in literacy and higher education, industrialization of the economy, rapid urbanization and the development of a consumer-oriented middle class. Combine these trends with a still-youthful population that will increase from 5.6 billion to 7.9 billion in the next four decades, in contrast with the populations

Liberal solutions to a global problem: demographic change and the future of Europe

Where will the people be? World Population, in 000s

10 000 000

Most Developed Nations

8 000 000

Less Developed Nations

6 000 000

4 000 000

2 000 000

In every rich country, the growth in the population aged 15-64 is dramatically slowing, and in some cases has already reversed. Germany’s workforce peaked in 2005, and is on track to return to 1950 levels by 2050. Japan’s workforce is shrinking even more rapidly. Even in the U.S., despite immigration and higher birth rates, the increase in the working-age population from 2000 to 2050 will be only about one-quarter as rapid as it was from 1950 to 2000. By itself, this will knock down economic growth by 0.5 to 1.0 percent per year. Moreover, as the baby boomers age they will move out of their prime working-age years (and their prime innovating, saving, and investing years) and into age brackets where dis-saving and high consumption of health care and leisure services dominates. Thus a slowergrowing work force will have to somehow pay for the pensions and health care of a very rapidly growing group of elderly; this will shift economic activity away from investment and growth into consumption.

2. Productivity and Economic Output in Europe (and Japan, the U.S. and Korea) will be hampered by stagnating and ageing workforces.

Source: Goldstone, Jack A., A Entirely New World: Demographic Change and The Future of Europe, 14 October 2010

of Europe, North America, and Japan where the waves of educational expansion, industrialization, urbanization have already crested and stabilized at high levels while population growth has virtually ceased, and it is easy to see why the bulk of future economic growth will likely come from the developing world. Indeed, if recent growth rates continue, with per-worker productivity increasing roughly 50% faster in the developing countries than in today’s rich countries, then as much as three quarters of all global economic growth in the next forty years will occur in today’s developing nations.

3. Tomorrow’s generations – today’s youth – are growing up overwhelmingly in developing countries with unstable or ineffective governments. Almost 90% of the children under age 15 in the world today are growing up in developing countries. In most of those countries, governments are unstable or having great difficulty in providing adequate educational and job opportunities for those youth. Such frustrations play a major role in fomenting regional instability, including among the 30% of world youth that are Muslims. More than that, today’s youth are also tomorrow’s global labour force—and since virtually all of the world’s labour force growth for the next forty years will occur in developing nations, whether these youth grow up skilled and productively employed and pro-Western in their views, or unskilled, underemployed, frustrated, and virulently antiWestern will determine the future prosperity and security of the world, not just of the developing nations.

Liberal solutions to the coming challenges Looking out at the demographic data, I feel like an astronomer who has spotted a large asteroid headed directly at the earth. At the moment, there is little evidence of the potential disaster that lies ahead. Moreover, there is a considerable window of time – roughly 10-15 years – before the worst impact, during which slight corrections, if steadfastly pursued, can prevent disaster. However, if nothing is done, the impact of these demographic changes will eventually transform life as we know it. If richer countries continue to grow in hostility to immigration and resist adjusting their welfare and fiscal policies, their state finances will simply collapse in the face of funding their obligations when roughly one out of every three adults is 60 or older (a

Less Developed Countries

4 000

Most Developed Countries

3 000

2 000

1 000

Source: Goldstone, Jack A., A Entirely New World: Demographic Change and The Future of Europe, 14 October 2010

Population aged 15-59 Prime Working Age population (Work Force)

5 000

In just the last decade, humanity reached a historic turning point, going from predominantly rural to predominantly urban in their habitat. Over the next forty years, the world’s urban population is projected to nearly double, from 3.6 billion to 6.5 billion, even though total global population will increase by less than a third. This is almost entirely due to rapid urbanization in Latin America, Asia, the Middle East, and Africa, where mega-cities of 10 and 20 million will soon become far more numerous than they are in the rich countries. This trend will reverse historic trends, in which the largest cities throughout history have been in the world’s richest societies; in the future the ‘typical’ human being will be a low-income resident of a Third-world megacity. Whether this trend leads to greater efficiency in energy use and waste processing and is accompanied by reduced pollution and improvements in public health, or the reverse, will determine the health of the planet, its climate, and the quality of life of the bulk of its population.

Global Labor Force Growth

4. Humanity has shifted from a rural to an urban species.

situation that will arise by 2030 in most developed nations). Who will be doing the productive work when half the adult population is either over 60 or caring for someone who is – a situation unprecedented in human history? In the developing nations, what will lie ahead for their 2.72 billion children and youths 24 or younger today—compared to just 363 million in that age group in the developed countries? If a large proportion of those youth grow up without the education and skills to be productive, in countries with unstable or ineffective regimes, they will overwhelm the capacity of the remaining world’s population to cope with the frustration and violence that will likely ensue. Iraq and Afghanistan, Pakistan and Nigeria, Uganda and the Democratic Republic of the Congo – these countries currently have a combined population of about 500 million, the same as the European Union. In just four decades, when the EU27 countries are likely to have fewer working and military-age inhabitants than today, these six countries will have doubled to over 1 billion in total population. Who will then attempt to help these countries if their civil order is not greatly

Liberal solutions to a global problem: demographic change and the future of Europe

Europe’s aging and shrinking Labor force 120

Change in millions

Population 80+

100 80

And how safe will the world be for travel, commerce, and public health if the addition of 2.5 billion urban residents in developing nations produces megacities that are reminiscent of Europe’s early industrial cities -- epicenters of disease, pollution and waste, wretched inequality and squalid conditions? But how can it be otherwise without new designs for ecologically sound, energy-efficient, and healthful living for low-income but vast urban agglomerations? Meeting these challenges and avoiding the worst impacts is certainly possible, but it will require immediate shifts in policy and – much more difficult – in attitudes. It must be recognized that the coming changes do not represent mere cyclical ups and downs, where we can think of restoring prior conditions. The coming changes – European populations more aged than any known to history, a huge shift in global labour force increase and economic growth potential to areas outside of Europe, and most of humanity moving to cities – will create a world unlike any we have seen. Maintaining prosperity and security in that new world will require new thinking and new adaptations. Two features are critical to success: flexibility to entertain novel and innovative responses to new conditions, and embracing globalization to gain opportunities for growth and avert future conflicts. In Europe, flexibility will first mean new flexibility in work, finding active and valuable roles for people in their 50s, 60s, and 70s. As these senior workers become an ever larger part of Europe’s total labour force in the coming decades, it will be vital to find ways to keep these workers active and productive.

Population 60+

Population 15-59

40 20 0 -20 -40 -60 -80 -100

1950-2000

2000-2050

Source: Goldstone, Jack A., A Entirely New World: Demographic Change and The Future of Europe, 14 October 2010

strengthened in the coming years? And what if their frustrated youth continue to seek to take out their frustrations on a West that they see as detached and hostile, interested only in their resource wealth?

Second, it will mean even greater flexibility with regard to flows of people, both for emigration and immigration. For centuries, Europeans sent young and mid-life emigrants out to other regions around the world in search of a better life. This pattern may need to be renewed. With hundreds of millions who will soon be in their 50s, 60s, 70s, and 80s, many of these older Europeans may well find new careers or more affordable retirements in developing nations, where their experience and skills will be especially valued, and where rapidly growing markets and consumers will provide opportunities for new businesses. Moreover, with much larger populations of workers, at lower wages, the labour-intensive tasks of caring for the elderly and providing chronic medical care will be far more affordable in developing nations than seeking to provide all the doctors, nurses, and health technicians that will be needed within Europe. European nations would be wise now to join with developing countries to train and certify geriatric health care centers and

Conversely, if Europeans want to educate the best students at their universities, to keep or increase their share of the world’s youthful innovative energies, and have sufficient young workers for everything from physically intensive labour in mining, landscaping, manufacturing, and construction to labourintensive services, Europe will have to accommodate even more immigrants than it has today. This brings shudders and fears that local ways of life will be lost, even anxieties that Shari’a law or other foreign customs will overwhelm European ways. Yet this overlooks the success that immigration-rich countries such as America, Canada and Australia have enjoyed, growing in wealth while keeping their distinctive national character. Europeans must consider their cultures and values weak and fragile indeed if they worry that allowing their population of foreign born to double, from around 1 in 10 in the most immigration-heavy countries today to 1 in 5, will end up with those 20% culturally overwhelming the remaining 80%! In fact, all evidence that we have on immigration points the other way. Where assimilation is open and easy, the attractions of liberty, equality and security under the rule of law are so attractive that they are readily embraced and absorbed, so that by the 2nd or 3rd generation, descendants of immigrants are almost indistinguishable in their values and politics from the native majorities.

Age structures, 2005 Percentage of Population under 15 years old, 2005

40+

30-39

20-29

>20

Source: From Jack A. Goldstone, «Flash Points and Tipping Points: Security Implications of Global Population Changes,» Environmental Change and Security Program Report • ISSUE 13 • 2008

retirement communities along the southern Mediterranean and the Indian Ocean – a move that could save hundreds of billions of Euros in health care and pensioner expenses over the coming decades. Moreover, while Europe will have a peak demand for such facilities only from 2030 to 2050, the populations of developing countries will then themselves start ageing, so that such facilities will be valuable investments for their own populations as well.

The difficulties of immigration arise when the native population (even more distantly arrived immigrants) views newcomers not as potential assets and contributors to national diversity and growth, but as threats and temporary guests. Discrimination and intolerance breeds immigrant resentment and hostility, in a mutually aggravating cycle. Europeans today need to recognize that their children and grandchildren will live in a world where 90% of the world’s population was born in today’s developing countries. How safe and prosperous will their grandchildren be if they treat that 90% as dangerous and alien? How much safer and more prosperous will they be if instead they attract the best and brightest and most enterprising of those 90%, give them an education in European values and skills and traditions, and invite them to join in building a more innovative, richer, and creative Europe? More broadly, all institutions – schools, workplaces, local communities, government institutions – will have to become more flexible, accommodating themselves to varied age-groups and

Liberal solutions to a global problem: demographic change and the future of Europe

temporary and permanent immigrants. Figuring out how to sustain economic activity, promote innovation and new businesses, and utilize a more varied, older, and diverse workforce and population will require fresh ideas about work patterns and the life-course. The very idea of ‘retirement’ as a sudden and complete transition from working to non-working will probably have to change. Instead of full pensions at a certain age, it would make more sense for governments and private employers to develop plans to subsidize shorter work days, or shorter weeks, or longer paid vacations for workers over age 65, so that working is gradually phased out between 65 and 75 with only modest declines in total income. Health care will have to focus more on how to keep people healthy and active longer and treat chronic ailments far more cheaply and efficiently, rather than on providing the best possible care of acute illness or injury. Schools will have to focus more on training diverse populations for citizenship (the American model) rather than simply on imparting work skills as soon as possible. Companies will have to focus their energies on emerging country markets, and in particular on making products that will enhance productivity and the quality of life in vast cities at economical prices, not just cater to their slow-growing home markets. Embracing globalization will also be vital to avert political and economic disaster. With most global economic growth likely to arise in developing countries, how can European economies grow if they become shut out from those markets? With 90% of the world’s future labour force growing up outside of Europe and North America, what could be more important than ensuring that those youth grow up with useful skills and values compatible with ours? Why are there not vast networks of American and European schools in developing countries, to compete with the Wahabi schools funded by Islamists? Why are there not more European and American students studying abroad, learning the cultures that will inevitably be those of their future workers and consumer

markets? If American or European schools would be unwelcome as creations of former imperialists, why not partner with Brazil or Turkey or India or Indonesia – all now proud democracies in their own right – to develop programs to improve their own schooling, and then to also send their teachers abroad to help currently less successful developing nations? We also will have to rethink the institutions of global governance for a new world. The most successful institution for spreading the values of democracy and equality, reducing corruption and enhancing prosperity, has been the European Union. What could be more important to the future prosperity and security of Europe than ensuring that the largest, most rapidly growing, and strategically pivotal country in its region absorb and embrace European laws and values? What could be more foolish than to encourage a country whose economy and population will, in a few decades, surpass that of Russia, to view itself as inherently alien, hostile, and incapable of acting in accord with those values? I am of course speaking of Turkey, a country with vast economic and political potential that at present is right on the cusp of leaning toward becoming more European in its laws and values, or of turning away from Europe and embracing links with the more authoritarian nations of the Middle East and Central Asia. Which influence would Europe like to see become stronger in Turkey? Does not the question answer itself – yet why are European leaders seemingly anxious to push Turkey in the opposite direction from integration with Europe on terms that Europe can set? Similarly, NATO is now wholly obsolete. An alliance of north Atlantic nations designed to repulse an attack from a Warsaw Pact coalition that no longer exists, it is now engaged primarily in stemming security threats around the world. NATO needs more manpower and global reach, something that cannot be provided by ageing societies in the north Atlantic alone. Why

not give Japan and Australia and New Zealand full membership in a global NATO? Why not plan for Brazil or Indonesia to join Turkey in teaming with the other European and north American countries in a broad defense alliance to preserve the security of democratic nations? Why not let NATO become DATO – a global set of Democratic Allies in a Treaty Organization?

Jack Goldstone is a professor at the George Mason School of Public Policy in the USA. He is a leading authority on social movements, regional conflicts and international politics and is a consultant to the U.S. government.

Europe’s prosperity and security since World War II has rested on its embrace of liberal, democratic values, including pluralism, religious freedom, and respect for the law. Europe cannot hope to preserve its prosperity and security by turning away from those values, or pretending that those values are virtues that inhere only in people who have lived in Europe for generations (an argument once made by Europe’s hereditary nobility, who claimed special treatment and unique virtues if they could show several generations of noble descent). In a world where Europeans will be a small and ageing minority in the global population, Europe’s best hope is that liberal and democratic values are widely absorbed and diffused by increased movements of peoples, ideas, and institutions across the world.

Shaping liberal policies on demographic change The ELDR Focus Year 2010

On the following pages, you will find some excerpts from the website that collectively correspond to the four main areas that constitute the Theme Resolution above: • Economic Impact of an Ageing Society • Free movement, Immigration and Social Cohesion • Inter-generational Dimensions of Demographic Change • International Cooperation To see the full set of articles and opinions expressed on this subject go to the Focus Year website www.eldrfocus2010.eu

The economic impact of an ageing society Ageing is a major policy challenge, but not insurmountable

European Commissioner Olli Rehn • 29 June 2010 For the first time in history, the vast majority of Europe’s citizens are able to lead active, healthy and participative lives well into old age. This is a great gift for mankind, but at the same time the combination of living longer and low birth rates also poses major economic, budgetary and societal challenges. The EU is projected to move from having four working-age people (aged 15-64) for every person aged over 65 to a ratio of only two to one by 2060. The largest decrease is expected to occur during the period 2015-35 when the baby-boom cohorts will be entering retirement. Increasing labour force participation rates in most countries will at best only moderate the fall in employment due to the shrinking working age population over the period from 2020 to 2060. A shrinking working-age population will act as a drag on economic growth and on per capita income. Ensuring that public policies cater for sustainable and adequate retirement incomes remains a priority for economic policies in the EU. The task is by no means small. On the basis of current policies, age-related public expenditure is projected to increase on average by about 4¾ percentage points of GDP by 2060 in the EU – especially through pension, healthcare and long-term care spending. While this has been known for some time, the effects of the current crisis on public finances are only unfolding. The overall public debt level of the EU27 is forecast to increase from a little over 60% of GDP to over 80% in just three years time. That means increasing interest expenditures and less room to take care of higher age-related spending needs in the coming years. The challenges created by rapidly ageing populations have also led to policy reactions. In fact considerable progress has been made in implementing reforms of welfare systems (pensions, and health care). Many Member States already pay due consideration in their medium-term budgetary planning

to the long-term sustainability and viability of public spending programmes and to the future fiscal positions overall. However, for several countries where the pension reform process has not been set in motion, the pre-crisis message is only accentuated: there is a need to align the ‘pension promise’ with what the rest of the economy can be expected to support. Adequate pensions can be provided in the longer term only if the pension systems are financially sustainable.

Support ratios, number of persons aged 65+ (retired) to persons aged 15-64 (in working life); 1995-2050. European Union

2050

United States

1995

United Kingdom Russian Federation Japan Italy

Most of the countries that have implemented major reforms in recent years also need to take a look at the sustainability situation, given the drastic impact of the crisis. Structural policies, notably with regard to welfare systems, and their contribution to economic growth are at the centre of the policy debate. This involves all aspects of pension policy; striking the right balance between the role of public and private pillars, eligibility criteria (prolonging working lives, adjusting the retirement age), generosity before and after retirement (accumulation of pension rights and indexation of pension benefits after retirement), and improving the functioning of pension policy, providing sustainable and adequate retirement incomes for older people. A major challenge will be to create the appropriate conditions for older workers to remain longer in the labour market in the future. Accomplishing this will give rise to a double dividend: higher living standards for all and an important contribution to public finance sustainability. Careful design of effective financial incentives combined with improvements in the working life is necessary to achieve this. The challenging tasks ahead should not depress us. Not only are there good examples of successful pension reforms in the

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Source: UN Population Division, Department of Economic and Social Affairs. Replacement Migration: Is It a Solution to Declining and Ageing Populations? (New York, UN Secretariat, ST/ESA/SER.A/206, 2001)

The economic impact of an ageing society - ageing is a major policy challenge, but not insurmountable

past. Equally important is that while the statistical share of “old” people is increasing, the 65 or 70 year olds in 2060 are not the same people as today or 40 years ago. On average they are much more healthy, better educated, and have better financial resources. Most if not all of the additional years of life can be active, rewarding years. This also means that people can stay longer in the labour market, but not only that. Elderly people can contribute to their own, their families’ and their communities’ wellbeing in many other ways, too. The task is simply to facilitate this sort of active ageing, no more but no less either.

The economic impact of an ageing society Interview with Swedish MP Barbro Westerholm

Barbro Westerholm MP â&#x20AC;˘ 21 June 2010 European Liberals focus in 2010 on the challenges of demographic change. With a generally ageing population in Europe a sustainable funding of health care systems becomes a major reform task. What is your approach to introduce change in Sweden? We need to invest in precautionary measures and use existing resources in an efficient way. This is important for all age groups. Health care efforts need to be coordinated in a better way, not least for elderly people with multiple diseases. Medicinal maltreatment is all too common, and has unfortunate side effects not only for the patient, but is also generating high costs from medical complications or from achieving at best marginal effect. We need to phase out inefficient treatment and focus on evidence based medicine. We must also upgrade our education for doctors and other health professions and take measures to facilitate their follow-up work on the results of their own treatments, so called therapeutic auditing. By implementing these steps, we will get much more value from our current resources, thereby taking the first steps to a sustainable funding of health care systems. In view of the challenges of an ageing population: how do you view the debate on retirement ages? Do you see raised retirement ages, or even an abolishment of them as part of the solution? All studies conducted concerning projected need of funding for maintaining our levels of welfare and financing of current retirement schemes show that we need to work longer.

Interview with swedish MP Barbro Westerholm

Opinion polls conducted in Sweden show that up to one third of the respondents would like to work beyond the set date of retirement, would there be possibilities of doing so; for instance through cutting down their work load and doing part-time during their final years of employment. However, up to this date, this has not been possible, largely due to the myths surrounding older people on the work market and a too literate understanding of retirement ages set through Parliamentary decisions and trade union deals. The health care sector is also an innovative business sector. How can Europe ensure to maintain and increase the workforce in this sector? By improving the possibilities for clinical research. The persons currently active within the health care sector rarely have the time nor the resources to develop their ideas. In addition, the incentives for doing research within this important area are too small. Careerwise, it does not pay off to do research. Do you see a need for joint European action on reforming health care systems and if so, what? We should decide ourselves how we want to develop our respective health care systems in the Member States. However! The method of open coordination and an increased amount of transnational cooperation in research and development projects enable us to make good progress. What is your liberal recipe to strengthen the prevention of illnesses and diseases in order to avoid exploding costs of treatment?

Working with preemptive efforts requires a thorough gathering of knowledge about a certain health problem and its effects, so that it can easily be communicated to the public as education without it being perceived as sticks. The source of the information is important. In the case of Sweden, NGO:s opposing tobacco and the Swedish Cancer Society has been the most important sources of information about the adverse health effects of the harms of tobacco smoking. A central state authority can easily be perceived as a â&#x20AC;?moral big brotherâ&#x20AC;? and therefore not listened to

Free movement, immigration and social cohesion European migration policy: the need for fairness and balance

Jan Kees Wiebenga â&#x20AC;˘ 17 August 2010 European migration policy should be fair, flexible and balanced while taking into account the subsidiarity principle. Balanced in that it rejects open immigration on the one hand as well as <immigration zero> on the other hand. Of course, it should be fully compatible with the relevant human rights provisions. A coordinated immigration policy must also be accompanied by a strengthening of efforts to combat illegal immigration according to the rule of law. Regional and national differences should be taken into account. Outlined below are some key elements of such an immigration policy: 1) Economic immigration: a worldwide battle of talent scouting is at stake. In this respect it is urgent to facilitate the entry of highly skilled persons in a coordinated way. While open labour immigration will in the long run not resolve labour market shortages, the European Blue Card Directive needs a better implementation. On the other hand, EU member states must maintain competence over deciding the level of immigration that is appropriate for their labour markets. 2) Illegal immigration: readmission agreements are necessary, but a liberal European migration policy requires commitment to a root causes approach. The promotion of stability and economic development of the countries of origin and transit is crucial. 3) Border control: in view of the problems with which most of the southern and eastern EU member states are confronted more burden sharing is to be practised, preferably via Frontex. 4) Asylum: abiding by the human rights treaties and the Geneva Refugee Convention implies the generous reception of refugees, while combating procedural abuse. Better coordination at the EU level of the national policies concerning

Free movement, immigration and social cohesion - european migration policy: the need for fairness and balance

amnesty programs for undocumented migrants is necessary. The forthcoming European Asylum Support Office has an important role to play in assisting member states with their implementation problems. 5) Integration: integration programmes for immigrants who recently arrived in Europe are primarily a responsibility of the member states, in accordance with the subsidiarity principle. 6) Family reunification: here again further harmonisation, a better implementation and actualisation of the present EU Directive is needed. All in all European policymakers must always take into account that a fair, flexible and balanced European migration policy is a policy area concerning human beings, all of whom have a right to a decent life, wherever they live.

Free movement, immigration and social cohesion Demographic change in rural areas and agriculture: adaptation instead of counteracting

Britta Reimers MEP â&#x20AC;˘ 8 October 2010

The impact of demographic change can be observed in the European agricultural sector: Between 2003 and 2007 the number of farmers younger than 35 years, dropped from 1.2 million to 822 670. During the same time, the total amount of people employed on farms decreased by 12.4%. Additional to the population growth rate, the process of migration causes demographic effects and has a significant influence on population development in rural areas. Next to the exodus from mainly agrarian rural areas, there is a trend towards suburbanisation. This results in growing conurbations with advantages of agglomeration in the vicinity of bigger cities.

I am observing these effects in my two German constituencies, Schleswig-Holstein and Mecklenburg-Vorpommern: Whereas the population of Schleswig-Holstein is largely declining, the number of residents in the surrounding area of Hamburg for instance, has been increasing steadily during the last 15 years: Between 1995 and 2007, the district of Pinneberg alone has grown by 17,000 people. The negative natural growth rate in this district is compensated by a positive net migration. Current estimates of the government predict this trend to continue until 2025. Mecklenburg-Vorpommern, with its 72 inhabitants per square kilometre, is the most sparsely populated state in Germany. Since 1990 the number of residents decreased by more than 200,000. Once more the demographic development has been intensified by migration processes: Approximately 11,000 of those between 20 and 25 years of age left the state in 2006, while only about 6,500 people of the same age group have settled in Mecklenburg-Vorpommern during this period. Moreover, the developments show large heterogeneities, not only regionally but also from community to community. Demographic change is a part of a complex structural change, which occurs not only in agriculture and rural areas, but rather throughout our whole society. The significance of globalization and Europeanization, a progressive tertiarisation, the presence of new information and communication technologies throughout all areas of life and the individualization of our personal lifestyles play a role in this process. Simultaneously, demographic change and the associated structural changes reinforce the dissimilarities between urban and rural life. The quality of life in rural areas is negatively affected by this: Technical infrastructure, such as garbage and sewage disposal, energy and drinking water supply is becoming increasingly expensive due to the decline in population. Schools, libraries, hospitals and other facilities of social infrastructure disappear. In the following years, the development of European agriculture

Demographic change in rural areas and agriculture - adaptation instead of counteracting

will as well be influenced by these processes. Whereas in 2003 there were still 14.8 million farmers in the European Union, in 2007 this number decreased to 13.4 million. Similarly, the number of farms has declined by 8.8% during that period. At the same time farm structures have been increasing in size, and are expected to do so in the future. The number of farms with more than 50 ha of land has increased by 9,690 between 2003 and 2007. Against this background, an unambiguous policy framework is necessary, to deal with the impact of demographic change in rural areas and agriculture. Since the 1960s, the Federal Republic of Germany pursued spatial planning controls following the model of decentralized concentration: The concept of “central places” assigns different levels of centrality to certain towns and communities, where the social infrastructure should be concentrated. The resulting network of central places is intended to ensure comprehensive availability of essential infrastructure to counter the effects of demographic development. Decisions in this area are taken at state and regional level, the function of a “central place” is in practise not necessarily understood as an order of regional planning. With my two constituencies I have the possibility to observe and compare the spatial developments in States of former East and former West Germany. Even 20 years after reunification it can be seen that the structurally weaker states in eastern Germany, despite significant infrastructural improvements, are in average more affected by demographic change than the western regions of Germany. The share of people, older than 60, in the East is in average 28%, while it is only about 25.4% in the western states of Germany. Similar differences in development will probably occur between the structurally weaker and stronger regions of the European Union. This in

turn suggests that approaches to policies of spatial planning should be orientated more closely to the needs and habits of the different inhabitant structures. Due to the variety of local situations, the responsibility for shaping spatial development concepts should increasingly be given to local levels and, in the sense of a bottom-up approach, should be adapted as close as possible to the individual local conditions. Additionally, demographic change requires an increasing partnership of responsibility between local authorities and better collaboration between regions, including across states. In relation to agriculture, it is of primary importance to promote the sector’s flexibility in dealing with the structural changes in terms of a future-oriented and economically successful approach. Generally, it is desirable if political approaches were not essentially based on counter measures, but would instead also adapt to the circumstances, brought about by an ongoing demographic change, especially if demographic growth is seen to be unlikely. In connection with a pragmatic approach to spatial restructuring and social changes an enhanced systematic deconstruction and conversion of infrastructure in sparsely populated areas should be considered. This would go hand in hand with an increasing privatisation of governmental services. A reinforced use of new media and technological improvements, as well as a widespread supply with broadband internet in rural areas could improve the living conditions in rural areas. Urban and rural ways of life cannot fully be adjusted to each other. Demographic change will not be stopped by political intervention. We should rather use the possibilities to adapt spatial development to these developments. It presents opportunities for some areas, and brings disadvantages for others. Indeed, it will make our regions more diverse, we should approach such change with open-mindedness.

Free movement, immigration and social cohesion Why Europe needs to increase legal immigration

European Commissioner Cecilia Malmström • 16 June 2010 Europe is an old continent in many ways. Not least if you look at its demography. According to demographic data the working population in Europe will start to shrink already as from 2013/2014. Between now and 2050, it will have shrunk by 30 to 40 million people while the number of people aged 65 and above will increase. The EU will change from having four to only two persons of working age for each citizen aged 65 and above. The economic crisis and the high unemployment rates in many parts of Europe make many politicians forget the plain reality we are facing: creating more legal ways into Europe is crucial to our future welfare. To that end we need to fulfill the objective set out already in the Lisbon Strategy, which was confirmed in the recently adopted EU2020 Strategy, namely to make the European labour market as attractive and competitive as possible. Europe needs to step up in the competition for labour. This is important since the world-wide competition for manpower will increase. It is not only the EU Member States that will face this demographic challenge but also the US and Canada, and in a few years time even China. There are certainly differences between the Member States’ needs for manpower and an EU migration policy must allow for some variations between the Member States’ in their approaches to labour immigration. Nevertheless, if we are going to be able to achieve the goals set out in the Lisbon Strategy; that the EU should remain an open and competitive labour market, we need to create more legal ways for labour immigrants to come to Europe. A flexible and demand-driven labour immigration policy would best meet Europe’s needs.

Why Europe needs to increase legal immigration

Our society is changing to become more and more knowledgebased. High-skilled workers and intra-corporate transferees can play a vital role for the EU’s economic recovery and for its future competitiveness. We must therefore make the EU an attractive labour market. The adoption of the so-called Blue Card Directive is a first step in this direction. In order to continue to increase the attractiveness of the EU as a labour market, I intend to shortly present two proposals which will further facilitate legal migration to the EU; a proposal to facilitate the movement of intra corporate transferees to the EU and a proposal concerning the conditions of entry and rights of seasonal workers. I will also evaluate the functioning of the Blue Card next year, being well aware of that it is quite narrow in its scope. People have always moved – both within and between countries – and human mobility has often been a source for economic, cultural and technical development. The free movement of capital, goods, services and people across borders are the fundamental principles of the European Union and a defining feature of our increasingly interconnected and interdependent world. Even if increased mobility poses significant challenges – for the countries of destination as well as for the countries of origin – the benefits that can be realised through well-managed global migration cannot be put into question. Migration is a positive force that we neither can, nor should, try to restrain. Both the Lisbon Strategy and the EU 2020 Strategy recognise that labour immigration is a part of the economic recovery. We should therefore encourage peoples’ willingness to move between countries and regions. As a liberal I think that is a good thing.

Inter-generational dimensions of demographic change

Young people – a strategic asset for Europe European Commissioner Androulla Vassiliou • 24 June 2010 As Europe’s societies age, policy-makers tend to focus on the needs and demands of their older constituents. This is understandable but ill-advised. Giving young people better opportunities will eventually improve the lives of all Europeans. The crisis has hit young people particularly hard: about one young European in five is unemployed. Our young people deserve better than this. What can Europe do to improve their life prospects and job opportunities? Three priorities guide my action as European Commissioner: updating and improving our education and training systems; supporting youth in the transition to work and in their efforts to engage in our societies; and helping them to study and work abroad. The latter is crucial because – after fifty years of integration – young Europeans should be able to enjoy all the freedom and opportunity that our Union offers them. More youth employment, education, and the participation of young people in society have pride of place in the Europe 2020 Strategy, which aims to put Europe on the path towards smart, sustainable and inclusive growth. One of the 2020 flagship initiatives is called Youth on the Move and is devoted to improving education systems and helping young people enter the labour market. The fight against youth unemployment is a top priority and I have identified steps to take to enable a smoother transition for youths into the labour market. I am also looking into measures that can promote entrepreneurship among young Europeans.

Inter-generational dimensions of demographic change - young people – a strategic asset for europe

Europe is already one of the best places in the world to study and do research, but we need to better match the knowledge and skills that our education systems provide with the real needs of the labour market. Also, although formal education remains crucial, we should not underestimate the knowledge, skills and attitudes acquired in non-formal settings. 2011 will be the European Year of Volunteering. Volunteering is among the best ways to foster young people’s active participation in society. I will spare no efforts to promote young people’s voluntary activities, for example by promoting young volunteers’ mobility. The European Voluntary Service gives young people plenty of opportunities to serve as volunteers in another country for up to twelve months. Voluntary service brings many benefits, beyond those that volunteers bring to their host communities. For instance, volunteers themselves learn new skills and languages, and are better prepared for future employment and active participation in society. There is no single, easy answer to the challenges facing Europe’s youth. But these are some of the policies I will be pushing forward over the coming months, and I am confident they will open up new opportunities for our young people.

International cooperation Liberal migration policies â&#x20AC;&#x201C; taming the paper tiger

ELDR Party President Annemie Neyts-Uyttebroeck MEP & Network of Arab Liberals Former President Mohammad Tamaldou â&#x20AC;˘ 7 July 2010 With an economic and financial crisis, rising unemployment figures and uncertain future prospects, a discussion about the importance of migration is not top of the agenda. While populists on the right fuel prejudices and populists on the left ignore social realities, liberals find themselves caught in the middle of this political minefield. To counter cultural and religious prejudices and to avoid socioeconomic clashes, European and Arab liberals adopted a joint declaration in March 2010 which is a joint cross-continental dialogue on the socio-economic and human rights dimension of migration, comprising the following key points: Migration is a natural phenomenon that has contributed to the progress of human civilization, and is a natural part of todayâ&#x20AC;&#x2122;s globalised world. Yet, massive rates of immigration beyond the ability of one society to successfully integrate the newcomers, may pose many problems at local levels. There is little doubt that an increasingly ageing European population will find itself in dire need of a younger and well educated workforce in the near future. Yet, the mechanisms now in place are at best acceptable. Therefore, we need to confront, rather than shy away from putting needed improvements in place that would be beneficial for both parties. Europe needs to improve on this. Education is crucial for making informed decisions and raising awareness of the situation facing many citizens of countries with high migration deficits. Lacking education risks alienating people and contributing to a spirit of conflict and extremism. Yet, we

International cooperation - Liberal migration policies – taming the paper tiger

need to put a focus on the issues of development, education, democracy and human rights creating opportunity and hope for people in migrant societies. Representing core liberal values as tolerance and cooperation, Arab and European liberals together strongly call for an increased level of general education, as well as an increased presentation of facts rather than fiction on these issues, so as to avoid regrettable prejudice. Protecting the rights of immigrants is a fundamental part of human rights, therefore: • It is necessary to respect all the rights of immigrants, including civil, cultural and social rights. Specifically, the right of an immigrant to enjoy and express his/her identity, while, respecting the prevailing values and laws of the country he/ she is residing in. • It is necessary to protect an immigrant from all forms of discrimination, including economic and racial discrimination, and revisit all legislations and procedures that are discriminatory to all native and immigrant workers guaranteeing the right to promotion and equal treatment. In this regard the Union for the Mediterranean (UfM) can also play an important role and needs to be taken seriously, so that it becomes a silver bullet rather than a paper tiger. What is needed, not least to counter prejudice and misunderstandings, is an increased dialogue – not only intra-European, but also cross-regional. The UfM should serve as the natural forum for cooperation on migration and development in and around the Mediterranean.

This can also be achieved by joining regional efforts together to make migration a force that serves stability, growth and development for both home and host countries. This is especially important for Southern Mediterranean countries to make it more capable of absorbing migrants. Also, it will attract Arab diasporas who are able to deliver a new experience and participate in the development process.

European Liberal Democrat and Reform Party, aisbl Rue Montoyerstraat 31 B-1000 Brussel â&#x20AC;&#x201C; Bruxelles +32 2 2370140 Publisher: Federica Sabbati Lay-out and impression: Trinome.be Published with the support of the European Parliament