The IMF asks what would happen if life expectancy by 2050 turns out to be three years longer than current projected in government and private retirement plans: “[I]f individuals live three years longer than expected–in line with underestimations in the past–the already large costs of aging could increase by another 50 percent, representing an additional cost of 50 percent of 2010 GDP in advanced economies and 25 percent of 2010 GDP in emerging economies. … [F]or private pension plans in the United States, such an increase in longevity could add 9 percent to their pension liabilities. Because the stock of pension liabilities is large, corporate pension sponsors would need to make many multiples of typical annual pension contributions to match these extra liabilities.”
This is one reason (of several) why “doing fine against the baseline” does not much impress me as a fiscal standard. I hope to cover that broader topic soon.