I was born in the census year of 1960 at the tail end of the baby boomers. A half century later, I frankly submit that our nation was naïve about the consequences of this historic generation’s path through American history. In 1960, as our boomers entered the workforce, they became the focus of capitalists worldwide, and their economic and social decisions shaped what appears in 2011 to be our nation’s retreat from world leadership.
In 1960, America’s bustling population was 179 million. Economic times were good. Even though the number of workers per retiree to support the New Deal social contracts of Medicare and Social Security had dwindled from 42 in 1935 to only 16 in 1960, the purchasing power of the average family had more than doubled in that time. While government spending had increased from 20 percent to 28 percent to support our strategy of world military dominance, solid economic growth still seemed inevitable for generations to come.
America’s social awareness was growing as well. Led by the likes of Kennedy, King, and Johnson, America began to advance government to rectify historical social ills, and to cause capitalists to pay for their social impacts of growth. A decade later, influenced by the seeming senselessness of Viet Nam, in an attempt to ferment President Johnson’s Great Society, boomers began an expansion of government that would grow from 30 percent of GDP in 1970 to over 43 percent today. In that effort, Americans diverted capital into government social programs, slowing economic growth to a level that could not sustain boomers’ retirement years.
In 2011 looking back, it seems that our representative democracy left us unprepared to support the boomers’ last stage of life. Even though the 2010 census swelled to 309 million Americans, our worker to retiree ratio dimmed to 3.2 and is falling still. And while rising wages from 1940 to 1960 lessened the impact of changing demographics, wages during the last forty years stagnated, leaving middle class boomers inadequately funded for retirement, and leaving young people with inadequate income to support them. While these changing demographics knowingly loomed for years, America failed to plan. As a result, a socially divisive wedge has been driven between the boomers and our youth.
This view of our boomer dilemma leaves me with unanswered yet glaring questions such as: Why did our government levy social impact costs caused by our capitalists but not fulfill their fiduciary responsibility to levy financial impact costs on capitalists’ MNC investments? Why did our government create only limited regulated retirement investment opportunities to funnel our boomers’ frenzied savings into stock investment bubbles? Why did we then deregulate debt financing to further funnel now desperate boomers’ savings into mortgage derivatives? Why did we allow capitalists to siphon these boomer funds into overseas investments without creating sustainable good paying employment in America for the young people who would be called upon to support our boomer retirees?
Why were American capitalists allowed to lobby for free trade, and transfer boomer wealth overseas without paying forward the retirement impacts of those investments? Why were our primary educational systems, designed to feed an earlier industrial economy, allowed to fail a third of our future taxpayers as our capitalists instead focused on funding adequate primary educational systems in emerging countries. Why were our secondary educational systems allowed to inflate the real cost of college education by 150 percent during the last 30 years, beyond the reach of many Americans, when our government’s stated strategy to combat emerging economies was to use innovation of college graduates to create new high paying jobs? What is the responsibility of our wealthiest Americans to the rest of our society in creating a feasible path through what will most likely be less than golden years for our boomers?
Answers to these questions need to be transparently debated as we now prepare for the legacy of our extraordinary generation. The paradigm of entitlement that gave boomers false hopes and that now embolden our youth to vote for change will soon end. We now are at pivotal moment in American history in which our diminishing demographics will change America’s societal paradigm forever. In its place will be the painful national discussion that must take place to pave a way forward.