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Baby Boomers Could Force Economic Catastrophe


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Fox News:


Lawmakers will look back on 2011 as the year the U.S. started down into a financial Grand Canyon, because the first baby boomers turn 65 this year -- the front edge of a tidal wave of baby boomer retirements.

"Over the next 20 years, around 10,000 baby boomers will be retiring each day," says Andrew Biggs, an analyst at the American Enterprise Institute. "That means more people collecting social security, more people collecting Medicare, more people collecting Medicaid as well,"

That also means the members of one of the most affluent generations will slow down in buying cars and homes and consumer products of all kinds, as they pass their peak earning years and head into retirement.

That could hurt the economy, but it is clearly a financial disaster for the federal government as those 79 million boomers shift from paying taxes into social security and Medicare and start collecting benefits from them.

"The federal government's going to be bleeding money as the baby boom retires," says Doug Holtz Eakin, a former director of the Congressional Budget Office. "We know we can't pay all the Social Security and Medicare benefits that we promised. There isn't enough money in the world to do that so we know we're going to have to make cuts," Biggs says. "But politicians are afraid to make the choices to do that."

The two programs need tens of trillions of dollars to pay all the benefits promised. And analysts say that when all the boomers are collecting benefits, the government would need one of every three dollars earned by those still working just to support social security and Medicare. Charles Blahous, a trustee of Social Security and Medicare, notes that younger Americans are " going to have a much, much higher share of their paychecks going to the federal government to support not only the federal budget in general, but specifically entitlement programs for the elderly."

There are lots of proposals to repair the finances of the two programs. But they're politically difficult, and the longer lawmakers wait, the harder and more painful the fixes get.snip
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I'm finding the obsession with this weird. Why are people just NOW talking about this? We should have been focused on the ramifications for the last decade at least!

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I'm finding the obsession with this weird. Why are people just NOW talking about this? We should have been focused on the ramifications for the last decade at least!

 

 

Well, every president seems to talk about it but it goes no where! W talked about it quite a bit and I thought when he got a R majority that they would finally take some steps. Seems as though they were more worried about their futures than the countries-Surprise!

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It has been talked about - and anyone who understood mathematics and basic economics have been predicting this.

 

The majority chose to ignore the evidence.

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One only need look at Western Europe to see what the future looks like - less freedom, fewer choices, less opportunity, higher gas prices, higher food prices, higher taxes of every known stripe and measure ...at the end, if fiscal responsibility is not restored, lies the spectacle of the Greeks.

 

Devaluation, massive inflation as governments seek to reduce their obligations by printing paper money and reducing the purchasing power of what they pay out (which will not be 'inflation-adjusted'.)

 

Or just ask the Serbs what tricks Milosevic pulled during the 1990s to keep his regime afloat while impoverishing everyone not part of his inner circle - particularly the elderly pensioners.

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That's exactly it. People have sounded the alarm for decades...but then there is this weird breathless tone to the articles and reports that have been coming out these last few days in the press. And still politicians who say "Oh no, everything's fine."

 

It's obvious to anyone with half a brain that this system won't work when a huge portion of the country isn't working. Doh.

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That's exactly it. People have sounded the alarm for decades...but then there is this weird breathless tone to the articles and reports that have been coming out these last few days in the press. And still politicians who say "Oh no, everything's fine."

 

It's obvious to anyone with half a brain that this system won't work when a huge portion of the country isn't working. Doh.

 

Because we're actually there now. Before it seemed way in the future, and maybe something would happen to change the inevitable.

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