Volume II, Number 12
October 15, 1996
Pundits wonder why Americans have become so cynical about politics. Could it be because our leaders just aren't addressing the issues that matter?
Although both Bill Clinton and Bob Dole know that America's coming age wave poses unprecedented fiscal and economic challenges, they exhibit an aptitude for choice evasion that borders on cognitive dissonance. Clinton dazzles audiences with news about how costly new health technologies could soon "raise the life expectancy of people...through 100 years or more." He then turns around to pummel the GOP for trying to restrain Medicare from growing at a rate that is manifestly unaffordable even assuming no such changes in technology or life expectancy. Dole earned his Senate reputation for candor and courage with proposals to control federal entitlement costs. He then announces, along with his tax cuts, that both Social Security and Medicare will be "off the table" during his presidency.
On Wednesday night, ordinary citizens will have the floor. Here are five issues they should insist the candidates talk about:
The federal government will hit fiscal meltdown by the time today's newborn starts a family.
The CBO, the GAO, and the Bipartisan Entitlement Commission have all concluded that the federal budget, if left on autopilot, will eventually wreck the economy. By the mid-2020s, deficits will surge past 15 percent of GDP -- an outcome that wouldn't be much changed by passing either party's budget plan. The candidates should be asked whether official agencies will still be issuing such dire warnings at the end of their terms.
Social Security will go bust when Boomers retire.
Social Security is officially projected to begin running operating deficits in 2012. By the time it is technically bankrupt in 2029, its annual deficit will have grown to $650 billion and its tax revenues will cover just three-quarters of benefits. Candidates should be asked how they intend to keep Social Security afloat. If by cutting benefits, don't Boomers have a right to know now? If by raising taxes, don't their kids have a right to know now?
On our current course, we'll have a Swedish-sized welfare state for seniors -- paid for by the young.
According to the latest Trustees' reports, Social Security and Medicare will cost between 35 and 55 percent of every worker's taxable payroll by 2040. Well before then. senior benefits alone will be consuming all federal tax revenues, leaving nothing for defense, investment, or children. The candidates should be asked how this prospect squares with their "vision" of America's future.
Today's youth are slated to get a much worse deal from Social Security than today's seniors.
Eugene Steuerle, a leading authority on Social Security, concludes that a typical single person Bob Dole's age is receiving roughly $50,000 more in Social Security benefits than the value of everything he or she paid into the system. But the typical single person of Chelsea Clinton's generation will be a net loser by a much wider margin -- unless we raise taxes and worsen the deal still further for today's newborns. The candidates should be asked if we're locked into this cascading pattern of generational inequity -- or if it's time to encourage genuine savings instead of more pay-as-you-go transfers.
Most Americans aren't saving enough on their own.
Our national savings rate in the 1990s is the lowest of any decade since the 1930s. Even though Americans expect to retire earlier and live longer, half of all family heads in their late fifties possess less than $10,000 in net financial assets -- a fact that underscores their dependence on unsustainable public benefits. The candidates should be asked how they would encourage or require Americans to save far more than they do today.
Denial among leaders triggers cynicism among voters -- which encourages more denial among leaders. To end this vicious circle, we must initiate an honest debate and reach a public consensus on what must be done to restore the American Dream for future generations.
FACING FACTS AUTHORS: Neil Howe and Richard Jackson CONCORD COALITION EXECUTIVE DIRECTOR: Martha Phillips
The Concord Coalition web pages were designed by Marla Parker and Krista Reymann. These pages are now maintained by Craig Cheslog. . Last updated: 24 Apr 1997