Will Americans celebrate another ‘Greatest Generation?’
In 1998 former NBC news anchor Tom Brokaw released his book, The Greatest Generation, which celebrated the lives and accomplishments of the people who matured during two of America’s most difficult times: the Great Depression and World War II. During these trying times through much of the 1930s and 1940s, people labored for their families and their country on a large scale basis, with virtually every American required — particularly during the war years — to set aside personal ambitions for the greater good. Only in this way was the rise of fascism that was sweeping through the world defeated. On this week that contains Memorial Day, it is fitting that Americans recognize the sacrifices of this greatest generation which led to the freedom and prosperity that typifies the years since the end of WWII.
Today, there are still people who sacrifice for our nation, that is, setting aside their own personal comfort and safety by joining America’s armed forces and fighting for our nation’s freedom and common values. Such people, however, are a self-selected few, with most of us required to engage in little or no personal sacrifice for the betterment of our nation.
The enviable atmosphere of freedom and prosperity our country has experienced since the mid-1940s is at risk, however, and sacrifice will once again be needed to allow future generations to have their opportunity to live “the American Dream.” The question facing America is whether another generation will step forward and willingly suffer personal setbacks for the greater good.
And what is this new monumental issue that requires such sacrifice and may endanger the very fabric of America’s national tapestry if it is not quickly and adequately addressed? Entitlement reform.
No doubt many are thinking that I have quite possibly lost my mind as I try to compare the hardships of WWII with the need to reform programs such as Social Security, Medicare and Medicaid. But for future Americans — some already born and most not — this may well represent the defining issue of this decade.
Within the past couple of months, I wrote about the need to reform Social Security, given the huge burdens that will be placed on future taxpayers should they be required to fulfill the politically expedient promises made by members of Congress to senior citizens. Without significant changes in the program over time to avoid sinking into the red, revenues will need to be increased significantly. So, without present or future seniors sacrificing for the greater good, future American families will see their standards of living reduced, deficits/debt explode, and/or taxes raised significantly. In total, the unfunded liabilities of the Social Security program amount to some $7 trillion over the next 75 years, with many analysts placing the figure well above that deplorable figure.
Even more critical than Social Security is the Medicare program (with Medicaid’s budgetary problems even more terrifying than these two social insurance programs … but that will be an issue for another day). According to many forecasters the unfunded Medicare liabilities over the next 75 year time horizon are somewhere around $38 trillion, better than five times the size of the Social Security shortfall. And many analysts place the potential red ink for this program at tens of trillions of dollars above this figure given the rapid rise in health care costs, the aging of the American population, and increased life expectancies.
Particularly alarming is that most Americans seem to feel that our nation’s deficit/debt problems can be addressed without substantive changes to the Medicare program. A recent survey of Ohioans found that more than three-quarters of adults feel Medicare can be excluded from budget negotiations as our annual deficits of better than one trillion dollars per year are added to our present debt of nearly $14.3 trillion. National survey-based research finds similar results, with Americans overwhelmingly against changes to Medicare’s promise of health care to senior citizens.
To be sure, such empathy for many of our country’s most vulnerable citizens is admirable. Virtually nobody wants to deny health care to anybody, much less senior citizens who may be in declining health, or who need access to health care to keep from falling into poor health due to the lack of preventative care.
But without major changes to the program, Medicare obligations will overwhelm the ability of the future working population to fund such inter-generational promises without enormous financial sacrifices. Which begs the question: will Americans celebrate another greatest generation? More about that question and how to address the issue next week.
Dr. James Newton serves as chief economic advisor to Commerce National Bank and is an auxiliary faculty member in economics and statistics at Ohio State University-Marion.