Posted on 11/10/2005 1:22:46 PM PST by qam1
America should prepare for a big fat war between the generations. Its 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 todays 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 todays 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 elses 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 wont. Though the irresponsible policymaking spanned decades, todays 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 nations 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 someones 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 presidents 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 Reagans top economic adviser. Feldstein drew flak for criticizing the Reagan deficits. The Bush White House wouldnt want to hear that kind of thing. Anyway, theres no need to worry about making ends meet when you can use the next generations 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 presidents 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.
How much land does the Fed own W. of the Mississippi ?
What program(s) could be funded by an orderly sell off of some of that land ?
Wouldn't it be a little hard to sleep in there?
http://liberalquicksand.blogs.com/liberalquicksand/2005/10/froma_harrop_li.html
Below are the last two paragraphs from the above:
"Froma the flaming liberal of course is demanding higher taxes to pay for it all, instead of fixing the problem in the first place! Froma and her liberal friends even whisper how Bill Gates and the other evil rich should not get their SS benefits, because after all, "they dont need them."
"Froma Harrop is a classic example of a liberal, a communist, a socialist a Democrat. This is why Democrats cannot be trusted to be elected Dog Catcher, let alone anything else. Hank Dagny-LQ"
& what's the name of those rebels - JI (?) that may take an active dislike of retiring Americans
The waves of illegal immigrants will take care of our problem, just like in Europe. Especially if they are Muslims.
Froma Harrop is an devoted anti-capitalist and Bush hater working in the guise of a writer. Her lack of understanding of economics has never prevented her from earning a living by writing about things that are beyond her grasp. What a great country we live in where such a know-nothing can earn a decent living spewing her know-nothingness, huh...
I was born in 1962.
I have paid more money to SS than you make - and I will never see a dime, in return.
On the way, I bought 5 college degrees for various folks - with five more on the way.
I don't want a dime of your money.
Stop pretending I do.
Find another bogeyman.
There is a new book out - "Hey, Mom! There is a liberal under my bed!"
It is meant for little kids. Go read it.
Is this supposed to be a good thing? Higher taxes choke off economic growth (making us all poorer) while encouraging even greater spending.
The scam is that the tax cuts are not really wiping the nations 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 someones taxes. So the Bush cuts simply move the taxes from one generation of shoulders to another.
No, the real scam is that politicians continue to promise something for nothing. No matter how much they extort from the taxpayer, they will always spend that much and more.
To paraphrase a dirty Rat, It's the spending, stupid!
Interesting comment.
Do you have much faith this money would actually be earmarked for such a purpose -- the proverbial "lock box".
The old statement, "Be nice to your children...they get to pick your nursing home.", is not so out of touch.
Your childlike faith in the government's ability to spend my money wisely is touching.
I set out to do the same thing here in Panama and I'm here to tell you that there's more than one side to that picture. Everyday I get woken up by squawking parrots and monkeys and I find myself, having to manage a maid, a gardener and other staff, looking at nothing but miles of jungle---
--and loving it.
A wee bit.
You might not want the money, but 99.9999% of the baby-boomers do. The wife is a social worker. She and the other social workers that she knows all agree that the coming baby-boomers are already exhibiting the worst signs of greed. They have little money, major debts, 30-40 year mortgages that have paid almost nothing on, they think they can work the rest of their lives or that social security might pay them enough to be happy. This is going to be interesting with each passing year.
My generation, which is just turning 50, is hard-charging, hard working and wants those younger people to get off their butts and TRY to work as long and as hard as we will...
Under our current estate taxing, capital gains are not taxed.
I've always felt that my generation (I was born in 1981. Count anyone born 1981 or later as my generation) has had far more in common with its grandparents (The WW2 generation) than its parents.
Who euthenizes the euthenizers?
I'm not going to be too worried about them.
I've got enough family there to man my compound. ;^)
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.