20 Hot Job Tracks When Baby Boomers Retire
Inevitably, Washington will default on its obligations, since it cannot pay out as much as it has promised. Young people know this. A survey found that they think they are more likely to see a UFO than a check from Social Security--and they are right. In theory, baby boomers might be saving enough to protect themselves as government benefits shrivel. In reality they aren't. A 1993 Merrill Lynch analysis found that half of all households (including baby boomers) had less than $1,000 in net financial assets, while corporate pension plans now cover less than half of all workers in the private sector and are dropping for younger ones.
"We are no longer the highly purposeful society we once were," writes Peterson. "We have instead become a choiceless society, a society that no longer confronts the tough trade-offs between today's consumption and tomorrow's higher living standards. ... Why did my generation permit this great shift in our national character?"
Next year, after the election dust settles, the White House and Congress need to agree quickly on a package that pares down the short-term growth of Medicare by at least $20 billion a year, an amount that can be reasonably absorbed without hurting seniors.
Then we should move on to the bipartisan commission that Bill Clinton and Bob Dole support, but with a stronger and broader mandate. (After all, Clinton already has ignored the Kerrey-Danforth commission that he set up for the same purpose in 1993.) This new commission should report to the country in two phases--first to educate us on the scope of the problem, then to report on its recommended solutions. It should address not only the long-term structural dilemmas of programs for the elderly but also ways to increase private savings. And it must have teeth so that, like the base-closing commission of the 1990s and the Greenspan Social Security commission of 1983, it compels politicians to act. One more thing: Commission members should be required to read this sledgehammer of a book from Pete Peterson.