Tag Archives: Intergenerational Theft

Commentary

Mark Steyn: the Democrat debt war on children

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From National Review.

Excerpt:

China becoming the world’s biggest economy, another American downgrade, total U.S. liabilities equivalent to about three times the entire planet’s GDP. A “non-partisan” Pew Research study says the American middle class faces its “worst decade in modern history” — and the first bump down starts on January 1: The equally “non-partisan” Congressional Budget Office now says that the tax and budget changes due to take effect at the beginning of 2013 will put the country back in recession and increase unemployment. This is a revision of their prediction earlier this year that in 2013 the economy would contract by 1.3 percent. Now they say 2.9 percent. These days, CBO revisions only go one way — down. They’re gonna need steeper graph paper. In a global economy, atrophy goes around like syphilis in the Gay Nineties: A moribund U.S. economy further mires Europe, and both slow growth in China, which means fewer orders for resource-rich nations. . . . Four wheels spinning in the mud, and none with a firm-enough grip to pull the vehicle back on to solid ground.

[…]But don’t worry, Obamacare will “lower costs.” Since passage of the bill in 2010, the CBO has revised its estimate of Obamacare’s gross costs over ten years. Can you guess in which direction, boys and girls? Yes, up from $944 billion to $1.856 trillion. That’s some “revision.” I wonder where it’ll be in another two years.

Well, I’m not the CBO, but I’ll take a wild guess: Obamacare is going to be expensive on a scale unknown to European health systems. Look around you. Americans are not Swedes. Obesity rate in the United States: 36 percent; Sweden: 9.7 percent; Japan: 3.2 percent; China: 2.9 percent; India: 0.7 percent. Ours is a country where 78 million people (or about the entire population of Germany) are classified by the Centers for Disease Control as “obese” — including over 40 million women. If 40 million women have it, isn’t that a “women’s health” issue? Perhaps even a bigger “women’s health” issue than the right of thirtysomething students to free contraception? It’s the first thing the average American of, say, 1950 would notice if you catapulted him forward from his mid-century Main Street to today: not how amazing all these computer gizmos are, but how large and sick today’s Americans look.

[…]So we can’t fight a war in Afghanistan, but we can fight a “war on women” that only exists in upscale liberal feminists’ heads. We can’t do anything about exploding rates of childhood obesity, diabetes, and heart disease, but, if you define “health care” as forcing a Catholic institution to buy $8 contraception for the scions of wealth and privilege, we’re right on top of it. And above all, we’re doing it for the children, if by “doing it” you mean leaving them with a transgenerational bill unknown to human history — or engaging in what Boston University’s Larry Kotlikoff, speaking at the International Institute of Public Finance in Dresden last week, called “child fiscal abuse.”

If that sounds a trifle overheated, how about . . . hmm, “legitimate fiscal rape”? No? Then let’s call it a “war on children.” Unlike the “war on women,” it’s real.

Are you a young person living with your parents with student loans and no job? Are you worried about how you will have to pay for ballooning entitlements for the elderly out of your future earnings? Then stop voting for Democrats.

News

Half of all Americans live in households that get government handouts

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From the Wall Street Journal.

Excerpt:

49.1%: Percent of the population that lives in a household where at least one member received some type of government benefit in the first quarter of 2011.

Cutting government spending is no easy task, and it’s made more complicated by recent Census Bureau data showing that nearly half of the people in the U.S. live in a household that receives at least one government benefit, and many likely received more than one.

The 49.1% of the population in a household that gets benefits is up from 30% in the early 1980s and 44.4% as recently as the third quarter of 2008.

[…] As of early 2011, 15% of people lived in a household that received food stamps, 26% had someone enrolled in Medicaid and 2% had a member receiving unemployment benefits. Families doubling up to save money or pool expenses also is likely leading to more multigenerational households. But even without the effects of the recession, there would be a larger reliance on government.

The Census data show that 16% of the population lives in a household where at least one member receives Social Security and 15% receive or live with someone who gets Medicare. There is likely a lot of overlap, since Social Security and Medicare tend to go hand in hand, but those percentages also are likely to increase as the Baby Boom generation ages.

[…]The more people who receive benefits, the harder it’s going to be to make cuts, and it’s never popular to raise taxes. In some respects that argues for letting a combination of tax increases and spending cuts that is set to automatically hit in 2013 take effect. There’s just one problem: the Congressional Budget Office says it would sink the economy into recession.

All of this dependence on the government is not good for us. How can we compete with the rest of the world when we just sitting around borrowing money from our kids and spending it?

News

How public sector pensions force children to pay for the prosperity of adults

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From the UK Telegraph.

Excerpt:

People retiring from the private sector need to save £250,000 to buy pension income equal to the national minimum wage – currently, £12,646 a year – or a total of £518,000 for a pension equal to national average earnings of £25,900.

These are among many eye-stretching facts in a new analysis of how unfunded promises to pay index-linked pensions to public sector workers are way beyond what most private sector savers can hope to achieve – and how these debts will burden children who have not yet left school.

The Intergenerational Foundation (IF) think tank used freedom of information requests to find out that 78,000 former public sector workers enjoy pensions of more than £25,900; and more than 12,000 get more than £50,000 a year. Three quarters of the latter are doctors and this index-linked income is irrespective of any private work or savings.

While many public sector workers pay into pension schemes, benefits usually outstrip employee contributions and the difference – or deficit – must be funded by future generations. Taxpayers’ total liability for public sector pensions, according to the report: ‘Are Government Pensions Unfair on the Younger Generation?’ is equivalent to £45,000 for every household in Britain and totals £1.2 trillion or £1,200,000,000,000.

An IF spokesman said: “This demonstrates the true scale of pension apartheid in the UK with news that 88pc  of public sector workers are currently entitled to pensions related to their final salaries, which are typically the most generous type of pension, compared to just 10pc of workers in the private sector.”

Don’t be fooled – this sort of thing happens in the United States as well, where teachers and government workers live high on the hog today and pass the bill to their children, who will be forced to pay for it all tomorrow. Is that fair?