|
In 2030, as 77 million baby boomers hobble
into old age, walkers will outnumber strollers; there will
be twice as many retirees as there are today, but only 18
percent more workers. How will America handle this demographic
overload? How will Social Security and Medicare function
with fewer working taxpayers to support these programs?
According to Laurence Kotlikoff and Scott Burns, if our
government continues on the course it has set, we'll see
skyrocketing tax rates, drastically lower retirement and
health benefits, high inflation, a rapidly depreciating
dollar, unemployment, and political instability. The government
has lost its compass, say Kotlikoff and Burns, and the current
administration is heading straight into the coming generational
storm.
But don't panic. To solve a problem you
must first understand it. Kotlikoff and Burns take us on
a guided tour of our generational imbalance, first introducing
us to the baby boomers -- their long retirement years and
"the protracted delay in their departure to the next
world." Then there's the "fiscal child abuse"
that will double the taxes paid by the next generation.
There's also the "deficit delusion" of the under-reported
national debt. And none of this, they say, will be solved
by any of the popularly touted remedies: cutting taxes,
technological progress, immigration, foreign investment,
or the elimination of wasteful government spending.
So how can the United States avoid this
demographic/fiscal collision? Kotlikoff and Burns propose
bold new policies, including meaningful reforms of Social
Security and Medicare. Their proposals are simple, straightforward,
and geared to attract support from both political parties.
But just in case our elected officials won't take the political
risk to chart a new direction, Kotlikoff and Burns also
offer a "life jacket" -- guidelines for individuals
to protect their financial health and retirement.
Laurence J. Kotlikoff is Professor of
Economics at Boston University and a Research Associate
at the National Bureau of Economic Research. Dallas
Morning News personal financial columnist Scott Burns
is nationally syndicated by Universal Press.
|
