Charge It to Our Kids<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
by Kerby <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Anderson
One of the political platitudes we hear so often is that we need "to do it for our kids." This is the justification for passing legislation, for enacting new bureaucratic rules and regulations, or for expanding health care benefits. But the reality in most of this is that we are actually spending money and charging it to our kids.
On my radio program I have talked about the vast amounts of money we are spending in the bailout package and the money so many want to spend on the stimulus package. But the federal government doesn't have the money, so we are borrowing on our children's future. We can debate whether this money will do what proponents say it will, but there is no debate that we are charging it to our kids.
Robert Samuelson writing in Newsweek believes this has become part of a larger generational war between baby boomers and the generations behind it. One of the reasons is the graying of America. In 1960, only one in 11 people was 65 years or older. Now the ratio is one in seven. By 2030, the ratio will be one in five.
Samuelson says the "plight of the U.S. auto industry provides an ominous warning." The Big Three automakers and the United Auto Workers put together a very generous retirement package with health benefits for their employees. But as costs grew, the main victims were the "younger workers, whose jobs, wages and benefits were squeezed to protect retirees."
In the past we have talked about the impact on the federal budget. Entitlement programs like Social Security, Medicare, and Medicaid are taking a larger and larger share of the federal spending pie. No major changes have been made in these programs, though we can give some credit to President Bush for trying.
Samuelson points out that there are parallel problems in state and local governments. While some local government pensions are fully funded, others report funding as low as 60 percent. The recent financial crisis wiped out approximately $1 trillion in assets.
It is nice to hear politicians say we need to do it for our kids, but the harsh reality is that often we are merely charging it to our kids.
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