Skip to comments.As the Boomers Head for the Barn
Posted on 05/15/2012 6:40:08 AM PDT by Kaslin
When the April figures on unemployment were released May 4, they were more than disappointing. They were deeply disturbing.
While the unemployment rate had fallen from 8.2 percent to 8.1 percent, 342,000 workers had stopped looking for work. They had just dropped out of the labor market.
Only 63.6 percent of the U.S. working age population is now in the labor force, the lowest level since December 1981.
During the Reagan, Bush I and Clinton years, participation in the labor force rose steadily to a record 67 percent. The plunge since has been almost uninterrupted.
Here is a major cause of the economic malaise of the 21st century, a condition over which a president has little control. A shrinking share of our population is carrying an ever-expanding army of dependents.
If this were a result of American women going home to have kids, that would be, as it was after World War II, a manifestation of national vigor and health.
But that is not the case here.
The number of Americans of working age not in the labor force grew in April from 87,897,000 to 88,419,000 -- by an astonishing 522,000. This is an immense army for the rest of society to carry.
Why are Americans dropping out?
Some have given up looking for jobs in towns they grew up in, because the jobs are gone and not coming back, and they don't want to leave. Some are rejecting the low-wage unskilled work being offered, because the alternative -- unemployment checks and federal and state welfare -- is not all that torturous.
With some, the work incentive was never implanted. With others, the option of moving back in with the parents is not all that terrible.
America, it seems, is becoming less like the country we grew up in, in its attitudes about work and idleness, and more like Europe.
Whatever its causes, this social and economic torpor that seems beyond the capacity of presidents to correct or cure is a dark cloud over the hopes of Barack Obama for a second term.
And yet another ominous cloud, no longer on the far horizon, is now directly above: the impending departure from the labor force of 70 million baby boomers in the next two decades.
According to the Statistical Abstract of the United States, from Jan. 1, 1930, to Dec. 31, 1935, there were 13 million births in the U.S. From January 1940 through December 1945, there were 16 million.
This was the Silent Generation, born in Depression and war. It never produced a president, and never will, unless Ron Paul catches fire pretty quickly. The Greatest Generation gave us six presidents, starting with JFK and ending with Bush I. Our three most recent presidents -- Bill Clinton, Bush II, Barack Obama -- are all baby boomers.
And here we come to the heart of our next economic crisis.
If one adds up all the children born between Jan. 1, 1946 and Jan. 1, 1965, the era of the great American baby boom, the total comes to 77 million babies born in the United States.
Why is this so significant now?
Because this year, 2012, the first wave of baby boomers, all those born in 1946, like Clinton and George W. Bush, will reach 66, and eligibility for full Social Security and Medicare benefits. The boomers, en masse, will start moving off payrolls onto pension rolls.
Let us assume the 77 million boomers are down to 72 million. This means that over the next 20 years, boomers will be retiring and reaching eligibility for Social Security and Medicare at a rate of 3.6 million a year, or 300,000 a month, or 10,000 every day.
Three hundred thousand a month leaving the labor force may help to explain its shrinkage. And as the boomers are the best-paid, best-educated generation we produced, the loss of their collective skills, abilities and tax contributions will be as heavy a blow to the nation as the funding of their Medicare and Social Security will be a burden to the taxpayers they leave behind in the labor force.
Since Roe v. Wade, abortions have carried off 53 million of the generations that were to replace the boomers. While those 53 million lost have been partially replaced by 40 million immigrants, legal and illegal, our recent immigrants have not exhibited the same income- or tax-producing capacity as boomers.
In 1965, LBJ announced his plan to convert our ordinary society into a Great Society. Since then, trillions have been spent.
The fruits of that immense investment? The illegitimacy rate, dropout rate, crime rate and incarceration rate have set new records, as the test scores of high school students have plummeted to new lows.
Our labor force is shrinking, the number of dependent U.S. adults is growing, our social programs are failing, and our best educated and most productive generation is retiring.
To borrow from Merle Haggard, "Are the good times really over for good?"
I am seeing more land for sale, too. Boomers are the owners. I don’t see the younger crowd buying large tracts of land. It is typically family farms and ranches being sold off as the older parents die.
It is now a blessing to have a home that will easily turn for what we have in it, which is paid off early and will translate house-for-house into a properly sized retirement property if we decide to move elsewhere.
There are too many people that are “house poor” due to an over emphasis on the primary residence as an “investment.”
The only thing we see is that when we retire, we probably will be in good enough health that our toys and hobbies take up too much space in our planned living space. The market needs more 1400 SF homes with detached seperate work/art sudios above three car garages and boat houses, LOL.
Every time I read something by you I think "ye forgot to wrap yer mummy" and pictures of ancient Egypt start coming to mind. =o)
“At least then I can collect some dissability before the boomers suck it all out of the system. Right?”
Way to buy into class warfare. The demographics of this has been clear for 40+ years. You can’t act surprised. Generations of government traitors are the ones that deserve your scorn. They cheated us all while making sure that they and their union cronies are set for life.
The difference is that foreign investors can buy US stocks thereby keeping the values up (not guaranteed, but it's possible), but the US FedGov can't levy SS payroll taxes on foreign workers.
So the pool of potential buyers of stock is equal to the population of the first world while the pool of SS payroll tax payers is limited to those earning wages in the US.
My apologies to those offended. I absolutely do not buy into the class warfare and do not blame boomers individually, certainly not fellow FReepers.
However, just as with crime Vs minority statistics, if we take the generational voting gaps and the huge block of voters that are in the Baby Boomer Generation over the last 40 years, statistically, the voting Boomers have had the numbers to significantly influence the election of politicians that pushed policies of dependents and deficit. They either started out as establishment politicians or slowly grew into those positions under the watch of American voters.
In 2001, my father 62, actually apologized to me for the way his "activist generation of Baby Boomers" (his words and he is a life long republican) had driven this country since the 60's when they started voting. I disregard from which generation a president came from because it was the citizens that elected them.
The blame for the whole unraveling of our constitutionally protected freedoms and economic stability is rooted in "progressive/liberal" ideology dating back to the New Deal. Until about 2007, Americans have been largely asleep at the wheel, apathetic. There seemed to be a brief awakening in the late 1970s early 80s. That gave us Reagan. But we seemed to hit snooze about the time Clinton was elected. Now that the house has been burning for almost 5 years, America seems bright-eyed and bushy-tailed. Unfortunately, we are now hoping to begrudgingly elect an establishment republican instead of a true conservative to start to fix the mess.
I don’t believe the Greatest Generation did very well to pass on the values, history, traditions and American Exceptionalism to their kids that they themselves significantly restored from the days of the Revolution.
The Greatest Generation pulled through the depression and volunteered to fight in WWII. They also voted for the politicians that pushed the New Deal, the source of many of our woes today.
I am making sure my kids are proud and knowledgeable Americans. My 10 year old knows the rich history of American values dating back to the Revolutionary war. She understands many of the details that spurred the Revolution and why the citizens were so upset with the King. She understands the good, bad and ugly about the civil war, war of 1812,...WWII, Cold War, Korea, Vietnam War, Gulf I, Afganistan, Gulf II, etc. My 5 year old knows who wrote our national anthem, where, when and why (He’s a work in progress).
I want my kids to love what America is supposed to stand for and where our roots and history has worked for and against us. I want them to be good Christians and successful participants and contributors to a freerer America using the talents God gave them and ethics we have instilled in them.
My hope is that they do not take for granted, as generations before them have, what individual freedom is and what it costs. We the People not voting, not following or participating in the governance of our nation is taking freedom for granted in my opinion. And that is primarily what has been are largest failing as citizens and owners of our government in the past 40 years.
And the kids don’t want what goes with it. Fences to mend, washouts to repair, pastures to drag, cut, bale and haul. All that stuff I’ve been missing for nearly 35 years chasing a buck and that is likely to go on ‘cause the bucks are worthless.
What was that guy wanting to pull 20,000 lbs on a bumper hitch that claims he makes truck beds and bumpers smoking yesterday? Guess he is desperate to do something. Sounds like divorce.
If a tree falls in the forest does it make a sound? I don’t know but it probably falls on a fence.
“I dont know but it probably falls on a fence.”
So true! I used to think Colorado was a wide open mountain range, but I found I can walk down hill for an hour or two in any direction and get to a house.
What happened to all that money?
It was taken from those who work for a living and given to those who vote for a living.
“Guess he is desperate to do something. Sounds like divorce.”
Sounded like something he was selling. Maybe he’s one of those guys making those oversized steel underground bunkers.
It seems to me that the last 15 or more years have focused on profits and not value. That is how the management has been motivated and that is why jobs went offshore... for profit.
Profit is not bad but it has not built the value of the stocks by underlying intrinsic value. That is why you invest, to build value.
Double taxation of profits in C corps does not employ capital efficiently or at all.
Stocks have risen because there were so many buyers who did not / do not understand value. Stocks have become merely a bet, an arbitrage and not a value driven proposition. Won’t buyers be looking for value growth?
Just a view point.
I'd love to buy large tracts of land. Either I can't afford it, or I have too long of commute in the areas I can afford the land. Back near my old home, I can get 100 acres and even a guesthouse for $150K. It's also in the middle of nowhere.
Same here. The mountains landlock us to the plains and anyting within a hour’s drive of work is expensive.
Large...tracts of land?
"Run away! Run away!!"
The struggle is against leftist idiocy across every demographic.
NO, they haven't. They have been in denial, sucking up the fable and quick to attack anyone who told them otherwise.