Either we sacrifice or the future generation suffers
Virtually every economist and most politicians understand that the American economy is heading for a crash – a very big depression-era crash. Of course, they do not say it that way. Instead, they say that government expenditures are “unsustainable.” That is a euphemism for the fact that the economic poop is going to hit the fan at some time in the future. Same say as early as the mid-2030s. They are not meaning a recession, but a 1929-style Depression, or worse.
The very real prospect of an economic catastrophe is the reason why we expect to see the future generation living to a lower standard than their ancestors – us. That is not an unwarranted fear, but virtually a certainty. Some say that the malaise that psychologists and psychiatrists say afflicts the younger generation is the realization that they will not have it as good as mom and dad.
Former U.S. Comptroller General David Walker is among those sounding the alarm. He believes that the folks in Washington are spending more than we can afford to satisfy every desire. As if that isn’t already obvious to the average taxpayer.
There are two 500-pound gorillas in the room – Social Security and Medicare. Although other issues – such as general welfare and social spending — play roles.
There are only two ways to keep those programs afloat and expanding – taxation and borrowing – and both are reaching their limits. The only solution is to cut spending.
This problem has been building since the end of World War II, when the “greatest generation” came home to become the “greediest generation.” World War II Americans have consumed more financial resources and more natural resources than any generation in the history of the world – more than they could pay. Borrowing compensated for the things even taxation could not cover. The greediest generation took every benefit they could and stuck their kids and grandkids with the bill.
The war-babies and the boomers turned to the government to provide the best of everything regardless of the cost. Their elected officials went on a spending orgy on their behalf. The greediest generation kept electing politicians who would use the federal treasury to satisfy both their needs and desires.
They wanted to get paid for not working through unemployment compensation, dubious workman’s compensation, early retirement, and a range of welfare programs. Consequently, we have the highest percentage of non-producing consumers in American history. According to census figures, only 63 percent of ELIGIBLE workers are working.
In 1950, each Social Security retiree was supported by financial contributions to the system of 16 workers. Today, each beneficiary is being supported by only 2 workers. And in 1950, no one was on Medicare – nor were the welfare benefits as generous. Welfare (charity) was basically a local issue.
As the so-called entitlements portion of the federal budget exploded, the ability to pay for them lagged behind – ergo the exponential growth in deficit spending covered increases in annual deficit spending –and by a growth in the National Debt. Currently, the Biden administration is adding $2.4 trillion to the National Debt each year. But the end of 2023, the National Debt reached $34 trillion.
Many, like Walker, believe that we have already passed the tipping point. We can no longer head off an economic disaster in the future but merely mitigate the severity. And that is ONLY if we take drastic action now.
Unfortunately, the economic and political realities are juxtaposed. The future disaster is worsened by those who say that Social Security and Medicare are untouchable. The responsible politicians are those demanding real cuts in federal spending, taxing and borrowing. Unfortunately, the conservatives who push for cuts in spending – and point out the absolute need to cut suture social spending, including Social Security and Medicare — are demonized by progressives and the media as heatless extremists.
If we do not reduce government spending, the economy will eventually crash. But politics works against those who see the need to reform and to readjust the entitlements programs to change the out-of-control trajectory. Greedy voters will not hear of it. They will continue to elect those who promise to keep the gravy train rolling.
The most noble moments in American history were when the people were willing to sacrifice for a greater cause. We saw that in the Great Depression and two World Wars. The question is whether we the people will recognize the disaster we are bestowing on our children and grandchildren and be willing to sacrifice. If not, they will suffer.
So, there ‘tis.