The Iron Chancellor’s Idea

Legend has it that “The Iron Chancellor,” German Chancellor Otto Von Bismarck,

first proposed the idea of mandatory retirement. Bismarck was acting within the same

political and social context as Karl Marx, the philosopher and author of the Communist

Manifesto at the end of the 19th century. European society was in a period of great change.

Society was still rapidly industrializing, and the ideas of “The Enlightenment” and the

American model of individual freedom intersected with an increasingly literate society.

The declining role of the church and the increasing role of democratic governments

actually increased the uncertainty in societies, especially during the transition period from

one form of political leadership to another. This contributed to a vacuum of ideology and

as a result, social philosophers, poets, artists and political figures with radical ideas

flourished and everyone was proposing new structures for society. The ideologies of

Communism and Fascism had their seeds sewn in the same period as Bismarck was putting

forward the idea of mandatory retirement.

Bismarck’s leadership predicament was that German factories were full of aging

workers and the streets filled with restless unemployed youth who were consuming the

revolutionary ideas of philosophers like Marx and Nietzsche. Churches as the predominant

and most consistent political and ideological force in Europe for more than a millennium

were waning in influence so much in fact that Nietzsche declared “God is Dead!” The

Freethinkers of the American Revolution and the Poets, Artists and Scientists of the French

Enlightenment had sewn seeds of enormous social change. The influence of scientific

rational thought and the explosion of industry and technology contributed to massive

change in society. The late nineteenth century was an ideological flashpoint in history

which culminated in two world wars. This ideological vacuum and demographic explosion

led to the social policy implemented in Germany to get the restless unemployed youth

working to keep them and the rest of the youthful masses from “Spontaneously Uprising.”

The German Government passed a legislation to pay workers over the age of 65 to

stop working. Since average life expectancy for men at the time was around forty years old

it was recognized at the time as largely a political move that wouldn’t cost the government

much money. That was in the age when the years of retirement were presumed to be

short for most people. And so the social experiment we call retirement began.

Shannon Boschy, BFA, CFP Financial Security Advisor, Mutual Funds Representative819-243-6497 - Scheduling and Administration613-282-5370 - Goal-Based Inquiries

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