First, aging populations are not new. The United States and other wealthy countries have been seeing aging populations for centuries, as increases in living standards and improvements in medicine have led to longer life expectancies. This has meant a growing population of retirees relative to the number of people working.

The D.C. fearmongers point to projections showing the number of workers per Social Security beneficiary falling from 2.8 his year to just 2.1 in 2035. But this prospect looks considerably less scary when we consider that the number of workers per beneficiary was 5.1 back in 1960. We have seen this number cut almost in half over the last five decades, yet both workers and retirees have seen substantial increases in their standard of living.

The logic here is simple: Productivity growth has allowed workers to produce far more today than they did in 1960. According to the Bureau of Labor Statistics, productivity is more than three times as high today as it was in 1960. This means that for every hour worked, a worker in 2014 on average produces three times as much by way of goods and services as did a worker in 1960. This is the reason that both workers and retirees can enjoy higher living standards even though there are fewer workers to support each retiree.