Posted on 11/10/2005 1:22:46 PM PST by qam1
America should prepare for a big fat war between the generations. It’s going to be ugly.
On one side is the baby boom generation, which retires and claims a ton of government benefits. On the other are younger workers, forced to fund those benefits plus pay the bills their elders left them.
When the war comes, the Federal Reserve chairman will have to be a general. That person will likely be Bush nominee Ben Bernanke. The question is, for which side will he fight?
Outgoing Fed Chairman Alan Greenspan tried to represent both sides. He supported the Bush tax cuts.
This gave comfort to today’s taxpayers, who chose not to charge themselves for the wars in Afghanistan and Iraq, the new Medicare drug benefit and the quarter-billion-dollar bridge to nowhere.
Last spring, Greenspan did service for the other side. “I fear that we may have already committed more physical resources to the baby boom generation in its retirement years than our economy has the capacity to deliver,” he said.
One solution would be to ramp-up means-testing for Medicare, the health insurance plan for the elderly. Greenspan would reconfigure the program “to be relatively generous to the poor and stingy to the rich.”
The political reality is that the baby boom generation expects to see the nice government handouts its retired parents enjoyed, and then some. Younger workers expect to be taxed at today’s lower rates. One group will be very disappointed — or perhaps both groups — because there is no way the Candyland economics of today can go on.
The whole alarming future is nicely mapped out in a book, “The Coming Generational Storm,” by Boston University economist Laurence Kotlikoff and Scott Burns, a personal-finance columnist at The Dallas Morning News.
Kotlikoff and Burns clearly sympathize with younger Americans and Americans not yet born, who will be paying both our bills and their own. “Does it feel better,” the authors write, “if those unknown victims of our rapacity are someone else’s children and the children of those children and the children of those children of those children?”
Sounds like war to me. Kotlikoff and Burns try to be meticulously nonpartisan, but I won’t. Though the irresponsible policymaking spanned decades, today’s mad deficits rush us closer to disaster. Democrats are not shy about pushing for retiree benefits, but at least they consider raising taxes to pay for them. Not the current crowd, whose spend-and-borrow strategy is the 1919 Versailles Treaty of this-century America: an unstable setup that guarantees future conflict.
The scam is that the tax cuts are not really wiping the nation’s slate clean of tax obligations. When spending exceeds tax revenues, the difference must be borrowed. That debt does not disappear. It gets paid for, with interest, by someone’s taxes. So the Bush cuts simply move the taxes from one generation of shoulders to another.
Bernanke would certainly come to the Fed job with good credentials. Head of the president’s Council of Economic Advisers, he formerly chaired the Princeton economics department. Bernanke seems OK, but other candidates were more upfront about deficits.
One was Martin Feldstein, President Ronald Reagan’s top economic adviser. Feldstein drew flak for criticizing the Reagan deficits. The Bush White House wouldn’t want to hear that kind of thing. Anyway, there’s no need to worry about making ends meet when you can use the next generation’s credit card.
Another Republican contender for the Fed job was Larry Lindsey. He was fired as a Bush adviser in 2002, after predicting that the war in Iraq would cost up to $200 billion, a figure already passed. Lindsey did not understand: One simply does not talk price in the Bush administration.
Given the president’s tendency to give top jobs to those closest, we can give thanks that he did not nominate his banker brother. Neil Bush played a major role in the Silverado Savings & Loan fiasco of the 1980s, which cost taxpayers $1 billion.
Or perhaps the president was doing the big-brotherly thing in protecting Neil from a job sure to be filled with strife.
The person who heads the Fed in the next decade will be trying to steer the nation through the perfect economic storm. Good luck to the new chairman, and to all the generations.
Ditto.....Thank God for the WW2 generation that was around long enough to tell us Gen-X'ers how things should be and not to make the same mistakes our parents made.
You darn right it was about *Me* I saw to many women friends my mother had that when they reached there Middle Age years around 50 looking like 70, what did there husbands do???? LEFT the younger woman syndrome and what did these Mid-Life women do? CRY AND CRY because they had no job skills, did not know how to manage a bank account they were totally LOST..I said I again *I* will never ever let anyone put me in that position...
I do to, it is amazing and great. We all gather for a Holiday or what-have-you....the younger generation's families are all intact....the baby boomer families all have X's and step-children, etc.....
That incentive is reduced by a lot when you consider that there aren't enough workers in the following generations to replace the boomers at the rate they are expected to retire. Where I am there is a major effort to retain boomers for as long as they're willing to work.
Listen, I have nothing against you, for you are a fellow Freeper....I just have great disdain for the baby boomer generation.
I wish I knew my grandparents better. They were not quite in the WW2 winning generation, were every so slightly older (in their 30s during the 1930s). But for example my paternal grandma was a civil defense warden and helped out with air raid drills and the like. She was also sort of a Rosie Riveter during the peak of the War and my grampa was building tanks. They did not live past their 70s and I simply was too young to know them in any meaningful way. I miss them dearly.
I bet I would blow you away. And from birth? BWAHAHAHAHAHAHA!
(Psssttt... I am close to 50 as well)
For all of you knocking Baby Boomers, YOU all should know it was the best time to grow up, we did not have computers we had REAL LIVE friends to talk too... We knew how to fix our own bikes, we did not have *FAT KIDS* running around, boys knew how to fix there cars, they had inventive minds and took chances NO OTHER GENERATION HAS...
Oh, boo-hoo, poor little you.
Look, children are not reared by a "generation"; they are reared by their parents. If your parents failed to provide you a loving, stable home with the brothers and sisters you desired, blame them.
Or better yet, make sure you do better for your children.
It is to bad that you really do not know the generation of 41 to 60 year olds..BABY BOOMERS...
I completely agree. Of all of the families in my neighborhood I can only think of one where both husband and wife work; and they are in the process of divorce. Each of the rest of the families are stay-at-home mom families. My wife knows just about all of the other moms in the neighborhood and spends a great deal of time with them letting the children play. It's a scene straight out of the 50's.
You really can't mean that post.....it may have been a "fun" time growing up...all the drugs, sex, and rock-n-roll....but please......
I with you here. All the whining on this thread I see about about how our perfect little generation will be screwed is just that.
1. Massive immigration, coupled with an increasingly regressive system of taxation, under which our lower and middle classes will pay an increasing share of our tax burden even if they never know it -- through hidden taxes on tobacco, alcohol, fuel, phone service, etc.
2. Understatement of inflation on the part of the U.S. government, which over the long term will result in diminishing standards of living for anyone collecting pension or medical benefits tied to the consumer price index.
Every generation has had it's problems and sure ABORTION on demand has gone out of control, but to blame a entire generation is ridiculous....
I wasn't necessarily speaking of me....but my generation as a whole and others I know....it really is the Fatherless Generation (Gen X'ers).
Or better yet, make sure you do better for your children.
That is a given.
Ever hear of the Cold War and the folks who busted their a$$ to keep you free so you could sit hear and whine about them?
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