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WASHINGTON (AP) — The wealth gap between younger and older Americans has stretched to the widest on record, worsened by a prolonged economic downturn that has wiped out job opportunities for young adults and saddled them with housing and college debt.
Quote:
The report, coming out before the Nov. 23 deadline for a special congressional committee to propose $1.2 trillion in budget cuts over 10 years, casts a spotlight on a government safety net that has buoyed older Americans on Social Security and Medicare amid wider cuts to education and other programs, including cash assistance for poor families.
"It makes us wonder whether the extraordinary amount of resources we spend on retirees and their health care should be at least partially reallocated to those who are hurting worse than them," said Harry Holzer, a labor economist and public policy professor at Georgetown University who called the magnitude of the wealth gap "striking."
No mention is made, at least in the parts you quoted, of the fact that Social Security benefits are not funded by general tax revenues. So if you cut everyone off at the knees tomorrow, and I suppose you would end the payroll tax at the same time, there would be no net benefit left over to fund programs for the young. Even Medicare, which is more complex in its funding modalities, is funded mostly by payroll tax and premiums charged to enrollees, and only partly funded by general tax revenues. (General tax revenues fund 75% of the Medicare Part B benefits, the other 25% being funded by the premiums charged to enrollees). Besides, the whole red herring misses the point. And the point is that older people have already paid into the pot for the benefits and these people are so anxious to cut. And the other point, also missed, is that despite the "wealth gap" between young and old, there is a substantial group of old people who are barely hanging on.
Furthermore, isn't a large wealth gap part of the natural order of things? Example: When I took my first career-type, full-time job in 1971, I had just gotten married and had essentially zero assets (a car and some cheap furniture). Now, in 2011, I have a paid-off town house and some savings (after a life-time putting money aside) and a pension. There is a substantial wealth gap between what I had as a 27-year-old and what I have now, and this is completely normal, not some cause for alarm. Some of these ivory tower type, such as the one you quoted, can't see the forest for the trees.
No mention is made, at least in the parts you quoted, of the fact that Social Security benefits are not funded by general tax revenues. So if you cut everyone off at the knees tomorrow, and I suppose you would end the payroll tax at the same time, there would be no net benefit left over to fund programs for the young. Even Medicare, which is more complex in its funding modalities, is funded mostly by payroll tax and premiums charged to enrollees, and only partly funded by general tax revenues. (General tax revenues fund 75% of the Medicare Part B benefits, the other 25% being funded by the premiums charged to enrollees). Besides, the whole red herring misses the point. And the point is that older people have already paid into the pot for the benefits and these people are so anxious to cut. And the other point, also missed, is that despite the "wealth gap" between young and old, there is a substantial group of old people who are barely hanging on.
Furthermore, isn't a large wealth gap part of the natural order of things? Example: When I took my first career-type, full-time job in 1971, I had just gotten married and had essentially zero assets (a car and some cheap furniture). Now, in 2011, I have a paid-off town house and some savings (after a life-time putting money aside) and a pension. There is a substantial wealth gap between what I had as a 27-year-old and what I have now, and this is completely normal, not some cause for alarm. Some of these ivory tower type, such as the one you quoted, can't see the forest for the trees.
I guess we should go on sacrificing for the young as we, especially parents, have done for a good portion of our lives.
I guess we should go on sacrificing for the young as we, especially parents, have done for a good portion of our lives.
Funny! I sacrificed a lot to raise and educate my children and they're all doing fine. Never resented it one bit and never found it strange to do so. If you meant "sacrificing the young" rather than "sacrificing for the young," I don't buy that at all. Yes, times are tough for them and may get tougher but they have the advantage of youth which gives them time and opportunity to turn things around.
Sorry (not really) but I don't buy into "the sky is falling" rumblings.
Furthermore, isn't a large wealth gap part of the natural order of things? There is a substantial wealth gap between what I had as a 27-year-old and what I have now, and this is completely normal, not some cause for alarm.
The larger question is about the wealth gap between the 27yo of today...
and the 27yo of decades past. In particular the ones who were working and earning and not saddled with debt.
Funny! I sacrificed a lot to raise and educate my children and they're all doing fine. Never resented it one bit and never found it strange to do so. If you meant "sacrificing the young" rather than "sacrificing for the young," I don't buy that at all. Yes, times are tough for them and may get tougher but they have the advantage of youth which gives them time and opportunity to turn things around.
Sorry (not really) but I don't buy into "the sky is falling" rumblings.
My you are having reading comprehension problems this morning. I meant what I wrote. Where did I indicate the "sky is falling" in my post? Maybe you meant the article in the OP.
As a single parent, money was very tight and I made sacrifices so that my daughter could have the opportunites that she deserved. No where did I say that I resented it. I would do it all over again, no regrets. When she was a young adult she told me many times that she knew I had a tough time while she was growing up and was very appreciative of my sacrifices. By the way, she has a great job with a fortune 500 company earning a 6 figure income.
All I am saying is that as a retiree, I am in no financial postion to keep giving to adult children. Too bad they fell into the trap of student loans. No one seemed to look at the reality of paying those loans back, especially if their degrees were in career fields with no demand. There were other alterntives. But, as you say they have time to turn things around.
It is natural for older people to have more accumulated wealth than younger, the article points out that the rate has increased 4 times as much than in the past, however. I worry about my nieces and nephews in college and newly graduated these days. Something has to be done about the student loan situation. Tuition costs have risen way beyond the inflation rate and they just expect students to take out higher and higher loans to cover it. In my day it was possible to work your way through a state university; today - forget it, your job can only cover part. The worst offenders are the for-profit schools; as soon as they passed the law that excluded student loans in bankruptcies, they went into overdrive recruiting marginal students for worthless degrees. All those ads I see on TV make me sick.
The article states that the median wealth of over 65 households has increased 42% since 1984. I wonder if part of that is due to the fact that many more people had pensions almost 30 years ago. If you don't have a pension you're hopefully saving a lot more in a 401K - that might explain part of that difference.
Besides, the whole red herring misses the point. And the point is that older people have already paid into the pot for the benefits and these people are so anxious to cut. And the other point, also missed, is that despite the "wealth gap" between young and old, there is a substantial group of old people who are barely hanging on.
There is a substantial wealth gap between what I had as a 27-year-old and what I have now, and this is completely normal, not some cause for alarm. Some of these ivory tower type, such as the one you quoted, can't see the forest for the trees.
Exactly - what you said!!!
Problem today isn't wealth gap between young and old. The problem is the present and future lack of decent employment opportunities for the young - unless they're geniuses.
US standard of living is on the decline to that of the world average. This has nothing to do with young vs. vold - and everything to do with profit and greed taking precedence over patriotism.
Problem today isn't wealth gap between young and old. The problem is the present and future lack of decent employment opportunities for the young - unless they're geniuses.
US standard of living is on the decline to that of the world average. This has nothing to do with young vs. vold - and everything to do with profit and greed taking precedence over patriotism.
That Georgetown guy is a dope.
W
No disagreement but that dope and others are trying to shape public policy. I have heard them and read their positions.
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