Friday, October 12, 2012

Last Night's Vice-Presidential Debate and The Young Versus the Old ... The Interests of the Young Are Being Ignored by Biden-Obama

We hear lots about the 1% versus the 99% and the now famous 47%. And the powerful versus the powerless. And trusting in the government bureaucrats instead of private sector leadership as the best way forward for America.

But we hear very little about the needs of the young relative to the demands and entitlements of the old. At least not from Biden and Obama.

Last night's vice-presidential debate was very interesting in that regard. Paul Ryan talked about the sustainability of Social Security and Medicare and the need for the younger citizens, like him, to embrace some combination of contributing more, receiving less or retiring later. In contrast, Joe Biden in his own condescending, arrogant, smiling, smirking and "save the middle class" manner had exactly ZERO to say about how to pay for these programs in the future. The Obama-Biden team just wants to get reelected and not address our nation's critical issues, domestic or foreign.

They're in effect proposing to throw the younger generations under the proverbial entitlements and debt ridden bus, in other words. And they have no plan for how the younger folks are supposed to be able to get out from under that bus either.

Biden acted arrogantly and condescendingly toward his much younger (and more honest and smarter, too) opponent throughout the debate. His smirks and smiles said that since he was born much earlier than Ryan and has been a big spender throughout his long political career, that should be enough for people to trust, endorse and vote for his team. It was his entire demeanor that strongly suggested "the young should be seen but not heard."

Is that the way things are supposed to work in America? That the young don't count, and it's all about getting the oldsters to vote for maintaining the status quo entitlements and welfare state that the old folks have created for ourselves? And for which the young folks will have to pay for the rest of their lives?

On the other side, Ryan reminded us of the awful state of U.S. unemployment and that 15% of us currently live in poverty. He made the clear and obvious case for emphasizing economic growth driven by the private sector as the way to jobs for young and old alike, economic prosperity and getting 15% of our people out of poverty and the rest of us who need jobs back to work.

We didn't hear anything at all from Biden about the "fairness" in all this and how the young are being treated by the old. Or how to address the poverty issue that the LBJ "War on Poverty" initiatives of the 1960s were supposed to have solved long ago. Dead silence was the Biden response to the poverty issue.

And that's a shame, because it's a crucial issue that needs all of our attention. To be blunt, fellow oldsters, we're in effect screwing the young. And it's a Democratic Party led screwing that has unfolded over the past several decades.

How so, you say? Well, read on.

Cutbacks and the Fate of the Young sets forth the highly persuasive case for treating our future generations in a profoundly more equal way than presently planned:

"During the presidential debate last week, Mitt Romney reminded us that it is our children, and grandchildren, who will end up paying for our budget deficits. His comment about the immorality of passing on such a large bill is a welcome reminder that our generation bears responsibility for the well-being of the next.

But the nation's growing debt is not the only threat to our children’s future. We need a broader debate about how to ensure that the next generation — the children of today and the taxpaying adults of tomorrow — have a fair shot at prosperity.
Right now, the next generation is getting shortchanged all around, with children too often treated as an afterthought in policies meant to appeal to their elders. The United States tolerates the highest rate of child poverty in the developed world. Yet federal expenditures on children — including everything from their share of Medicaid and the earned-income tax credit to targeted efforts like child nutrition and education programs — fell 1 percent last year and will fall an additional 4 percent this year, to $428 billion, according to estimates by the Urban Institute based on the Congressional Budget Office’s projections. . . .

The states, which provide more than 60 percent of the total government dollars spent on children, aren’t in great shape either. According to the Urban Institute’s estimates, state and municipal spending on children fell in each of the last three years.

And the outlook is not much better for the coming decade. . . . forecasts that federal expenditures on children . . . will shrink to about 2.3 percent of the nation’s economic output by 2022, from 3 percent last year.

Children have needs besides sound fiscal accounts. Deprived childhoods lay the groundwork for future social ills. We have the third-worst rate of infant mortality among 30 industrialized countries and the second-highest teenage pregnancy rate, after Mexico. We’re in the bottom quarter of countries in terms of literacy. Unsurprisingly, perhaps, half of American children born to low-income parents grow up to be low-income adults.

Investing in children is not just a matter of fairness but of economic vitality. Early interventions to help disadvantaged children can have an enormous return. They improve children’s cognitive and social abilities. They promote healthy behavior. They increase productivity and reduce crime.

Investing in education is about as good an investment as a society can make. . . .

There is good reason to be worried about our long-term budget deficits. They are indeed projected to be huge — driven mostly by the growing health care spending of an aging population. Medicare will absorb about 6.7 percent of the nation’s economic output by 2037, up from 3.7 percent today....

Brookings Institution . . . argues it is time to reconsider the intergenerational deal that has held since Social Security’s inception in the 1930s. The assumption behind it was that working-age Americans could support their children and every senior would be able to retire at age 65.

Today, this compact is under strain. Health spending has skyrocketed while middle-class wages have failed to keep up with the cost of living. The old are living longer and collecting more benefits than before. Even under new measures of poverty that account for seniors’ high medical spending, poverty rates among children have surpassed deprivation among the old. Seniors . . . could shoulder more costs so that more of the money from working Americans could be devoted to the young.

There are ways to do this while still protecting the most vulnerable seniors. Social Security benefits could be indexed to slow their growth for high-income seniors. Wealthier retirees might bear a larger share of their medical expenses. The retirement age could be raised.

The challenge isn’t going to get any easier as we keep aging and medical costs keep rising faster than economic growth. But so far the presidential candidates have stopped short of any fundamental change to the longstanding generational compact.

Mr. Obama proposes to address the problem by raising taxes on the rich. He hopes the Affordable Care Act can wring a lot of excess from our health care system — reducing Medicare costs along the way. The plan is likely to come up short, however. The efficiency gains remain hypothetical. And while raising more money from high-income Americans is a first step, most economists believe that to avoid cuts in health benefits the government must raise taxes on the middle class.

Mr. Romney’s plan could be more radical: replacing Medicare with vouchers for Americans to buy health insurance and capping the vouchers to control spending directly. But he has already said he would exempt most of the baby boom generation from his reforms. . . .

If the next generation is going to be handed the bill for our budget deficits, we might as well make the investments needed to help it bear the burden. So far, we seem on track to bequeath our children a double whammy: a mountain of debt and substantial program cuts that will undermine their ability to shoulder it when their time comes."

Summing Up

Oldsters vote in much higher percentages than do young people. Of course, children don't vote.

Oldsters also have retirement benefits which have long been "part of the intergenerational deal." But things have changed since Social Security was enacted during the years of the Great Depression. Why don't we acknowledge that simple fact, discuss its implications, develop an action plan for the future and then move on --- TOGETHER, YOUNG AND OLD?

Demographically we're getting older, retiring earlier and living longer. As a result, maintaining the status quo entitlement benefits structure is simply impossible.

It's totally unfair to future generations. It's also simple math. The fewer the number of years we work, the more retirement income we'll need. But we've been providing for less retirement income by having worked fewer years. Add in the fact that we're all living longer, and it's a triple whammy unaffordable situation for the younger generations.

To repeat, for the oldsters' retirement years, there is progressively (1) less money paid in due to fewer working years, (2) more paid out as we're prone to retire sooner and (3) more paid out as well because we're living longer.

When Social Security "Insurance" was begun in the 1930s (it was never insurance but it sounded good for getting voter approval so that's the word that was used), people didn't live for several decades after their retirement. And now we do. That's a good thing for our generation but not such a good thing for the future generations that are supposed to pay for all this.

And the cost of attending college has increased dramatically over the years as well. That's not a good thing for future generations who will have to borrow to pay high tuition and then as adults find jobs which will enable them to repay those student loans. Especially when there aren't enough good jobs to go around. And besides all that, the high cost and low quality of our K-12 education today isn't properly preparing kids for college and career success in a globally competitive economy.

The funds to pay for retirement benefits the next several decades are woefully lacking. There are literally tens of trillions of dollars in unfunded liabilities. It's just not fair for oldsters to pretend otherwise and be willing to pass the bills on to future generations.

For Biden to simply say that we're entitled to those benefits implies that somebody has already paid for them. That they've been earned. However, that's simply not true. The money will have to come from the paychecks of future workers, and that's not fair. These questions must be addressed and answered asap or sooner.

While I have no specific answers to all these questions, I do know that continuing to ignore this intergenerational funding dilemma won't solve anything.

I also know we're not being fair to the younger folks by not even discussing the affordability issue openly and candidly.

It's time to get real and give the next generation an equal voice in how we go about dealing with this reality, ugly as it is and as it likely will be for a long time to come.

Smiling and smirking and acting smugly and condescendingly just because you're older, Mr. Vice President, won't cut it with the fair minded American people. Young and old alike.

We the People know we're all in this together, even if you don't. That's my take.

Thanks. Bob.

1 comment:

  1. Pedro the Camel DriverOctober 12, 2012 at 6:29 PM

    Senator "Schmo" Biden's boorish debate tactics reveal the inner cobarde he really is no? (Si!) Senor Schmo is the poster child for term limits.