As of 2 October 2019, the US national debt was $22.71 trillion and growing rapidly, but hidden beneath that sobering number is a far more grim truth. According to Truth in Accounting, the unfunded liabilities of the United States are currently $163 trillion, the equivalent to $782,000 for every US citizen.
The most significant earmarked outgoings are unfunded Medicare promises and unfunded social security spending. Also included in this figure are pension and retiree benefits, and US public debt. This figure does not include future ‘discretionary’ spending on areas such as defence and the courts system, and does not take into account state-level liabilities, which currently stand at around $1.5 trillion.
Tax the Young to Pay the Old?
As of October 2019, twenty-three of the current sitting US senators were born before the end of the Second World War in 1945, making them part of what is commonly referred to what Tom Brokaw referred to as the ‘Greatest Generation’ or what Strauss and Howe term the ‘Silent Generation’. A further sixty-two senators are members of the Baby Boomers, with the remaining fifteen being part of Generation X. While septuagenarians such as Donald Trump, Bernie Sanders, Elizabeth Warren and Joe Biden are among those aiming to fight it out in 2020, there is not a single millennial represented in the US Senate (admittedly partly because of age limit restrictions).
As the sovereign debt issued and liabilities being created are mostly targeted at expenditure on the older generation, it is the millennials are being left to foot the bill. This comes as millennials increasingly report feeling pessimistic about their finances, with economic optimism for younger generations dipping to the lowest recorded levels on record.
Behind this intergenerational injustice lies the usual suspects: pork barrel politics; protected spending on special interests, such as the doctors lobby; the failure of Congress after Congress to balance it budget; foreign nations keen to milk the US cow by buying American treasuries; and, the creation of classes of mandatory spending. In each instance this is failure to allow proper competition, as for example the refusal to allow third parties to enter politics, the accreditation culture preventing entry into certain professions. Whereas in the previous generations it was blue collar workers who would band together to unionise and prevent fair competition for labour, today it is professionals such as teachers, bankers, lawyers and doctors, while lobbyists representing these professions work to ensure that their fellow countrymen are put hard to work filling up the trough. Mandatory insurance, union-negotiated teacher salaries, and excessive litigation are among the tools at accredited professions use to their advantage.
But the most significant special interest group is arguably retirees who have worked successfully to ensure that their interests never go unrepresented in Congress.
And tragically, it is the much-derided millennials, schooled in pop Marxism and special interest pleading by their Baby Boomer college professors, who will be left to pick up the pieces.