Fiscal Cliff vs. Baby Boomers

     We are being constantly pounded by the media with the fear that our country is about to go over the fiscal cliff.  While this is a major economic issue, there are other issues involved in how we got to this point in the first place.

     Humans are increasingly of the mindset that it is better to feel good now and put off the inevitable pain until a later time.  We use our credit cards because we can't fight off the urge to purchase something we should take time and save for.  Then we get other credit cards to pay the credit cards we already have.  The government acts in the same way as we borrow from China until that is no longer an option.  Then we begin the process of printing money and borrowing from our own central bank, which devalues our dollar.  So how did we get here?

     When you look back to the 1930's you see an America that was struggling through the Great Depression, as unemployment hit rates as high as 25%.  The government tried, as they are now, to spend their way out of the problem, and it in effect lengthened the economic downturn.  At that same point in history FDR came up with the plan for Social Security.  It was originally intended to benefit those who were over the age of 65, but the key to the plan was that the average life expectancy was 63.  So the majority of Americans would never benefit from the plan eventhough they paid into it.

     Today the story is much different.  The average American lives about 15 years past the date they begin to receive benefits.  Now this is a simple mathematical problem that a basic high school student could understand.  If you look at how much is taken out of your check each year for social security taxes, and then multiply that number by the number of years you plan to work, it becomes quite apparent that you will receive far more benefits than you paid in.  This is where the Baby Boomers come into play...

     The Baby Boomers generation is starting to retire and they want full benefits paid, but they are unwilling to accept reality.  They paid far less into the system than they will receive, and that will become the largest of fiscal deficits within the near future.  The government knows this, but they don't want to lose the votes of this enormous demographic group, so the debt continues to rise.  It is amazing to this author that this group of grandparents can look their children and grandchildren in the eye and say, "I need to receive this money at the expense of your furture."  Whatever happened to the person who tightened their belts for the benefit of their family?  I call on every American to stand up and take responsibility for your own finances and face the reality that our government cannot be the source of our future!  If we don't, the house of cards will soon come tumbling down.

Jeffrey Brandon Lee