April 11, 2007
Cassandra Devine knows how to solve the coming "entitlements" crisis, preordained when the 77 million baby boomers begin hitting 65 in 2011: Pay retirees to kill themselves, a program she calls "transitioning." If only 20 percent of boomers select suicide before the age of 70, she says, "Social Security, Medicare, Medicaid will be solvent. End of crisis."
Okay, Devine is a 29-year-old fictional blogger in Christopher Buckley's satirical novel "Boomsday." The comic tale revolves around two truths usually buried in our dreary budget debates, says columnist Robert Samuelson.
First, a generational backlash is inevitable. The idea that younger workers will meekly bear the huge tax increases needed to pay all boomers' promised benefits is delusional. The increases are too steep, and too many boomers -- fairly wealthy and healthy -- will seem undeserving.
- In 2007, Social Security, Medicare and Medicaid constitute 44 percent of the $2.7 trillion federal budget.
- To pay all future benefits could (depending on assumptions) easily require tax increases of 30 to 50 percent by 2030.
- Many retirees are quite comfortable; about 42 percent of Americans ages 65 to 75 have assets (homes, stocks, cash) worth $250,000 or more; 23 percent have annual incomes exceeding $69,000, says the Employee Benefit Research Institute.
Second, boomers will want even more benefits. Buckley imagines them clamoring for subsidies for Botox, grandparent day care and "giant flat-screen plasma TVs (for boomers with deteriorating eyesight)." Their actual demands may be less exotic and more expensive: closing the "doughnut hole" -- a gap of coverage -- in Medicare's drug benefit; more lenient tax treatment for retirement accounts; more payments for nursing homes.
Social Security and Medicare are an essential part of the social fabric. Millions depend on them. But the vast benefits -- paid too early and too indiscriminately -- have become disconnected from genuine need, says Samuelson.
Source: Robert J. Samuelson, "Boomer Boomerang," Washington Post, April 11, 2007.
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