If you try to do any back of the napkin math on how much end of life care will cost for this cohort your napkin will actually burst into flames. 75 million times x dollars in y years.
Yet all we have accomplished is to kick the can down the road once more. The only difference this time is it’s a red can rather than a blue one. Everyone wants a painless solution to a fiscal cancer that is destroying our country. As Phillip K Dick said “reality is that which, when you stop believing in it, doesn’t do away.”
Having lived through all of those fun “malaise” years with a 12% mortgage, it’s important to view Volcker’s success through the context of the times. The tools available to him at that time were many. Debt to GDP was only 30%, America still had a significant manufacturing sector, and inflation was coupled with growing unemployment. In 1979 the price of a barrel of oil doubled due to the Jimmy Carter facilitated Iranian Revolution, dramatically driving up input cost on nearly everything. Americans were ready to do whatever was necessary to fix the problem after a decade of moving sideways and down. Volcker drove the bond rates all the way to 20% to break the back of inflation, while simultaneously creating a double dip recession, and he had Reagan to backstop him as well.
Today’s Fed has none of these tools. They have QE’d us into this mess by supplying the monetary heroin to keep the spending party going. At a debt to GDP of 130%+, if they raised rates to 10%, debt service cost alone would consume all tax revenue, and you would see financial liquidity collapse. And not just here, globally. Yet our congressional leaders think we can just keep adding $1 trillion in the debt every 100 days and eventually a miracle will occur, hope is not a plan. As the saying goes, the only what out is through, and facing the reality of what we want vs what we can afford is that light at the end of the tunnel. My father’s favorite saying was “experience is the worst teacher, because you get the test first and the lesson later”.
Good observations, which are more salient than your original reflexive pessimism. These problems are still more matters of will than of a lack of tools. We're trying to break the system, not play by its' rules.
For example, as observed by BAP, a significant portion of our national debt is owned by foreign adversaries like China. I can't think of any reason to cancel debts owned to China as payment for international misbehavior.
Is widespread systemic reform and recovery even possible with the boomers still alive?
If you try to do any back of the napkin math on how much end of life care will cost for this cohort your napkin will actually burst into flames. 75 million times x dollars in y years.
No
Right? The entitlements are simply too large
Not that I am against it
Suddenly I am for it
Bugger the Boomers
I genuinely hope we get a massive recession
Yet all we have accomplished is to kick the can down the road once more. The only difference this time is it’s a red can rather than a blue one. Everyone wants a painless solution to a fiscal cancer that is destroying our country. As Phillip K Dick said “reality is that which, when you stop believing in it, doesn’t do away.”
Missing the battles for the war, so to speak, means missing the war too. Volcker won his battle, & we can win the next one on the horizon.
Winning the war means years of social chemotherapy, before the populace can tolerate political chemotherapy.
Having lived through all of those fun “malaise” years with a 12% mortgage, it’s important to view Volcker’s success through the context of the times. The tools available to him at that time were many. Debt to GDP was only 30%, America still had a significant manufacturing sector, and inflation was coupled with growing unemployment. In 1979 the price of a barrel of oil doubled due to the Jimmy Carter facilitated Iranian Revolution, dramatically driving up input cost on nearly everything. Americans were ready to do whatever was necessary to fix the problem after a decade of moving sideways and down. Volcker drove the bond rates all the way to 20% to break the back of inflation, while simultaneously creating a double dip recession, and he had Reagan to backstop him as well.
Today’s Fed has none of these tools. They have QE’d us into this mess by supplying the monetary heroin to keep the spending party going. At a debt to GDP of 130%+, if they raised rates to 10%, debt service cost alone would consume all tax revenue, and you would see financial liquidity collapse. And not just here, globally. Yet our congressional leaders think we can just keep adding $1 trillion in the debt every 100 days and eventually a miracle will occur, hope is not a plan. As the saying goes, the only what out is through, and facing the reality of what we want vs what we can afford is that light at the end of the tunnel. My father’s favorite saying was “experience is the worst teacher, because you get the test first and the lesson later”.
Good observations, which are more salient than your original reflexive pessimism. These problems are still more matters of will than of a lack of tools. We're trying to break the system, not play by its' rules.
For example, as observed by BAP, a significant portion of our national debt is owned by foreign adversaries like China. I can't think of any reason to cancel debts owned to China as payment for international misbehavior.
WIN- I remember that. “Carter (driven to whip inflation now)”. Volcker was a blessing.