Congrats Boomers! You win. You have accumulated more stuff than anyone AND you have set up more government perks than anyone according to a
new Wall Street Journal article.
Today’s Boomers have tilted the economy towards themselves and saddled younger generations with their debt and payouts and the cost is swallowing the budget.
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As of the third quarter of last year, people 70 and over controlled roughly 39% of all equities and mutual funds owned by households, compared with 22% in 2007, according to Federal Reserve data. Their share of net worth—assets minus debts—was 32%, up from 20% two decades earlier.
This is good news: there has never been a better time in America to be old. Yet it also exposes our disjointed national priorities. We keep pouring resources into making the elderly comfortable and happy when the economy’s pressure points lie elsewhere.
The elderly are mostly out of the job market and thus need not worry about being replaced by artificial intelligence. The majority own their homes, often debt-free. Everyone worries about health costs, but the elderly have publicly funded Medicare. None of this is true for the younger generations.
The cost is swallowing the budget. Federal spending on elderly programs has risen from 6.9% of gross domestic product in 2007 to 9.4% last year and will reach 11.3% in a decade, the Congressional Budget Office projects.
That is where the real threat to intergenerational harmony lies. Elderly programs, plus interest, are the primary driver of the gaping budget deficit. By 2032, Social Security will no longer be able to pay full benefits. Fixing the deficit and Social Security requires some combination of
higher taxes or lower future benefits, both of which will largely spare today’s elderly. If you think the young are anxious now, just wait.
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www.nilc.org
