We're all gonna die someday
Mama's on pills daddy's over the hill
But we're all gonna die someday
— kasey chambers
In 100 years, the evangelists like to remind us, we will all be dead.
They have a point. The mortality rate for the human race remains a steady 100 percent.* We're all going to die. Even the joggers, the nonsmokers and the vegetarians.
And, yes, even the baby boomers.
Sorry to state this so bluntly, but it's a rather obvious fact that somehow seems to have been forgotten in much of the current debate over the future fiscal health of America's Social Security system.
That program, it has been widely noted, is under a bit of strain as it was not designed to accommodate demographic anomalies like the post-World War II baby boom without a bit of tweaking. In the early 1980s, a commission led by Alan Greenspan — now the chairman of the Federal Reserve — provided such tweaking by creating a trust fund. The fund, fueled by the anomalously large contributions into the program from the baby boom's anomalously large work force, is intended in turn to later pay for the baby boom generation's anomalously large number of beneficiaries.
Some now insist, however, that Greenspan's solution is inadequate. It very well may be and additional tweaking may be required. Yet it seems strange that those arguing that the program is in serious fiscal danger do so by citing deficits in the very long term — 75 years or longer.
In 75 years the youngest baby boomers, those born in 1965, will be 125 years old. In other words, in the long run, as Keynes said, we're all dead. Seventy-five years from now the baby boomers will no longer be around to create any strain on the Social Security system. Their demographic bubble does not present an everlasting problem, only a challenge that lasts as long as their generation does.
So what's the rationale for projecting doom and gloom far into the future, even decades after the last of the baby boomers has settled in for the long dirt nap?
The theory, as far as I can tell, is that once the boomers retire, the American economy will be forever crippled. Without the unique contribution of their generation, apparently, it is assumed that the economy will not be able to do more than stagger along at a level of growth far below the historical pattern.**
Baby boomers are often unfairly caricatured as a generation of narcissists. The "me generation," it is said, has a disproportionate sense of its own importance and its own exceptionalism. Boomers, according to this stereotype, consider themselves the indispensable generation and cannot imagine the world as being capable of surviving without them.
This generalization is, as I said, a gross and unfair caricature. So why has it been embraced as the basis for our projections for the long-term fiscal health of Social Security?
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* I'll entertain exceptions for Enoch, Moses and Elijah. For the purpose of our discussion here, though, their special cases are beside the point — none of these three are still collecting Social Security benefits.
** As Paul Krugman, Brad DeLong and others have pointed out, this dismal economic forecast only applies to the 75-year predictions regarding the fiscal health of Social Security. When the subject is the 75-year prediction for the growth of private investment accounts, this forecast is set aside in favor of one dramatically more robust.
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