I've never claimed all the experts agree. Thanks for disproving no one.
I'm sure you'll dismiss this because of his age but hey I allowed your ad from amazon . com which basically listed a source twice and the other questionable places you get your info!
By the way according to that ad your book was published in 2004! That makes it 5 years old.
The rest of the " conclusions " in your argument are really your own invention.
No wonder no one wants to talk to you.
Congrats to you and yours
on being a means to an end
Oh god! Your private line ( Bat phone ) must be ringing ( I just saw you show up on " Currently viewing " while posting this )!
You'll have to pardon me if I ignore your personal bullshit.
But is that picture right? Yes and no. America does have an aging population, and a responsible government would take preparatory action while the baby boomers are still in the labor force. America also has very serious long-run fiscal problems. But these issues aren't nearly as closely linked as much of the discussion would lead you to believe. The view of demography as destiny is only a half-truth, and in some ways it's as damaging as a lie.
In this essay I'll try to set the record straight. Unfortunately, I can't do that by following Kotlikoff and Burns closely. Kotlikoff is a fine economist, one of the world's leading experts on long-run fiscal issues. His book with Burns is full of valuable information and sharp insights. Yet in their effort to grab the lay reader's attention, Kotlikoff and Burns do little to alert readers to the distinction between two quite different issues--an aging population and rising spending on health care. And their failure to make that distinction grossly distorts their discussion.
Krugman makes a critical error in reasoning here. The distinction is not something related to Kotlikoff or Burns data but with the programs themselves. The reason the projected problems with Social Security are smaller is because the benefit to be paid out for recipients is defined. You start taking your benefits and aside from increases for inflation, it stays the same.
Meanwhile health care costs are the great unknown. This is especially true as we increasingly see people pushing quality of life issues as health issues.
Let's see what he hits next...
The demographic problem is, of course, real. It is, however, of manageable size--exaggerating the problem by confounding it with the problem of medical costs just gets in the way of dealing with it. The problem posed by rising medical costs, on the other hand, would be there even if the population weren't aging--and misrepresenting the problem as one of demography gets in the way of confronting it.
This is a bit of strange reasoning, but given the initial claim, it is understandable. He wants to politely discredit the source since the data is irrefutable. The claim is that the rising medical costs would be there even if the population were aging and that is patently untrue. Medicare is set to explode because of the boomers entering retirement age. The fact that it will explode disproportionate to Social Security is not unrelated to age being a factor but due to the benefit being unlimited and undefined rather than defined as Social Security happens to be. If you find a doctor who will declare you need a quadruple bypass and two hip replacements, it will get paid for by the government. You cannot find anyone who can demand you get disproportionate Social Security payments or have them adjusted.
The demographic problem is "manageable" with Social Security because Social Security is RATIONED. Medicare is not rationed. Declaring that demography will lead to even more problems with unrationed medical care is not mistating the problem, rather the opposite.
Yes and no. America does have an aging population, and a responsible government would take preparatory action while the baby boomers are still in the labor force. America also has very serious long-run fiscal problems. But these issues aren't nearly as closely linked as much of the discussion would lead you to believe. The view of demography as destiny is only a half-truth, and in some ways it's as damaging as a lie.
The responsible government has not taken prepatory action. Instead they have run trillions in debt and are tacking on trillions more. The half-truth with regard to demography is the belief that boomers can do whatever they want and then when they are retired or dying, force their children, grandchildren and immigrants to honor their debts. Krugman and Roubini both have this view that none of the spending or dollar creation will cause inflation because it is being done with debt instead of merely the printing press.
Their "blindspot" is that the kids and grandkids will honor the debt. They won't, more like cannot honor the debt. Estimates are that it would require between high 60's to low 80's percent of their income in taxes. No one is going to give 68-83% of everything they earn to Grandpa and the government. Grandma and Grandpa Boomer will be in their walkers trying to shake their canes at the kids and tell them the debt must be honored, especially since inflation crushes the value of pensions and 401k's turned into annuities. The kids will look at them, and simply say "Fuck you Grandpa, I wasn't the one who ran the $20 trillion plus debt or the additional trillions in liabilities." They will then turn on the printing presses and monetize(print) away the problem. The alternative is to actually agree to give up all that confiscatory taxation with no complaint. The blindspot believes that since they have controlled everything their entire lives, boomers will be able to pull this off even as they near their deathbed or perhaps even from beyond it.
The procedure to help one see past their blindspot is generational accounting. It is what Kotlikoff and Burns spend the entire book creating and explaining. For example the Social Security Trust fund holds nothing but intergovernmental debt. It is an accounting trick that would make Enron proud and would cause any corporation to be indicted. When the boomers begin retiring this accounting trick goes away to the tune of half a trillion a year and again, the presumption is just that the younger generation will just take it. Raise your taxes half a trillion and provide half a trillion less in spending or benefits, and no complaints or qualms will be raised. That is nonsense.
Think I'm lying? Krugman bangs the blindspot right here....
If all this seems metaphysical, let's put it this way: What will actually happen when payroll tax receipts no longer cover 100 percent of benefits? The answer, quite clearly, is nothing.
There are only two ways Social Security could be unable to pay full benefits in 2018. One would be if Congress voted specifically to repudiate the Social Security trust fund, that is, not to pay interest or principal on the trust fund's bonds, which would in effect be a decision not to honor debts to retirees. In 2018 the payments on the trust fund's bonds would be sufficient to cover Social Security benefits. Repudiation of those payments is pretty much inconceivable as a political matter; writing in the periodical The Economists' Voice, David Kaiser of the National War College suggests that such a repudiation might even violate the Constitution. In that sense, the trust fund is as real an obligation of the US government as bonds held by Japanese pension funds. The other way would be if the United States found itself in a general fiscal crisis, unable to honor any of its debt. Given the size of the current deficit and the prospect that the deficit will get much bigger over time, that could happen. But it won't happen because of Social Security, which is a much smaller factor in projected deficits than either tax cuts or rising Medicare spending.
The summation of above. The only way it doesn't happen is if the kids don't pay and we've made it really, really clear they better pay. To whom is that repudiation inconceivable? The boomers with their blindspot. To everyone who is not a boomer the repudiation of the values of the boomers and leaving them the consequences of their own decisions and actions is very much conceivable. In fact the most appropriate phrase would be, "bet on it!"
The bursting succession of bubbles from internet stocks, real estate, commodities are all basically the boomers placing bets that the rules and reality won't come home to roost.(The internet changes the stock market forever, home values never go down) They've been wrong everytime. After those bets turned out badly, the boomers declared it would be okay because the corporations placing the bets were "too big to fail." We now know that is a lie so they have swept all their delusions up into one final bet where they have gone all in.
The last institution "too big to fail", why the U.S. government and the almighty dollar it manages as a reserve currency.
You can guarantee this bet will turn out like all the others. Generational accounting says you can count on it.