What We Owe Our Young
What We Gave Our Country
By Sandra Day O'Connor and James R. Jones
Monday, June 16, 2008; A19
Idealistic young voters have turned out in record numbers this year -- and not a moment too soon. How our next president represents the interests of young Americans will define not only his legacy but that of an entire generation of political leaders.
Idealistic voters turned out in record numbers in 2000 -- but it was too late. How the president we, the Supreme Court appointed, came to represent the interests of all Americans has defined not only his legacy, but that of the entire Republican party.
The standard Washington model for rewarding influential constituencies is an agenda of targeted spending, tax breaks or regulatory measures. Traditional patronage, however, will not suffice when it comes to preparing for the approaching tsunami of retirement and health-care spending.
The standard Republican model for rewarding influential constituencies is an agenda of ever-increasing defense spending, tax cuts for large corporations, large financial institutions, and wealthy individuals, deregulation of corporations, bailouts for financial and other institutions "too large to fail" and regulatory measures designed to imprison and disempower poor people and persons of color. Traditional patronage, however, will not suffice when it comes to preparing for the approaching tsunami of dollar devaluation, inflation, the ever-increasing likelihood world's reserve currency reverting away from the dollar, the collapse of the banking and mortgage banking industries, and the cost of overfunding the military-industrial-congressional-infotainment complex.
The Government Accountability Office and many, many others have documented the magnitude of the Social Security, Medicare and Medicaid bills that will come due over the next several decades. Even if every dollar of wealth of every millionaire in the United States were magically diverted to pay these costs, 80 percent of the unfunded liabilities forecast for these three programs would remain on the books.
So-called radical-liberal authors and many, many others have documented the magnitude of the costs of the war and war-profiteering bills plus the accrued interest on the national deficit that will come due over the next several decades.
Social Security Advisory Board Chairman Sylvester J. Schieber has found that honoring today's promises to tomorrow's retirees could put the living standards of working households on a path of decline by the mid-2020s, according to a groundbreaking study in the Milken Institute Review. Under this scenario, today's high school students might never experience a year in the workforce when their tax rates would not rise.
Social Security Advisory Board Chairman Sylvester J. Schieber has found someone to confirm his a priori belief that honoring todays promises to tomorrow's retirees "could" put the living standards of working households on a path of decline by the mid-2020s. This totally overlooks the reality that the federal government's fudging of inflation and unemployment statistics has presently put reduced the living standards of the majority of today's workers AND retirees. Under current trends, and coupled with the national security hazard of outsourcing virtually all of America's industry to lower-cost countries, many of today's high school students might never experience a year in the workforce when they are employed in any sector of the economy other than the "service" sectors.
Far more troubling outcomes are at least as plausible. Rather than raise taxes or modify benefits, our leaders could continue to follow the path of least resistance, shifting even greater burdens onto the young and endangering the living standards of everyone else in the process. Brookings Institution senior scholar Isabel Sawhill, writing in this month's Democracy Journal, warns of "realistic" budget deficits so large that by 2017, annual interest payments on the national debt would total $500 billion -- three times the amount of annual war spending in Iraq.
Far more troubling outcomes are at least as plausible. Rather than raise taxes on the wealthy by implementing a truly progressive tax structure, or eliminating tax loop holes that allow our largest and most profitable corporations to escape the heavy burden of any taxes at all in some of their most profitable years, or reduce expenditures on military hardware in an ever-escalating arms race with ourselves with which we never can seem to keep our defenses ahead of where our offensive strike capabilities will be by the time enterprising hi-tech workers or high-security clearance workers with dual citizenship with that nation which cannot be named critically, pass along the offensive strike capabilities state secrets, we can expect our leaders to follow the path of least resistance, and fund programs to build rocket ships to Mars, where they can escape the mess they have left behind before the lights begin to dawn upon the dimly aware.
A Brookings Institute "scholar" warns of "realistic" budget deficits so large, that by 2017, annual interest payments on the national deficit would total $500 billion -- three times the amount of annual war spending in Iraq. Although, in 2006, the annual interest payments on the national deficit totaled $406 billion of your money. Furthermore, under the present administration has willfully failed to include ANY amount of annual war spending in either Iraq or Afghanistan, which is perhaps not the way you would make out a budget, but then, how many of you are MBA Presidents, plus commander's in chief?
Among the likely casualties of such recklessness would be the very financial markets whose stability underpins the soundness of our private retirement system. And given the growing interdependence of the developed and developing worlds, and the advancing fiscal fragility of our aging allies in Asia and Europe, an American financial crisis could produce aftershocks that would rock the foundations of global prosperity.
Among the likely casualties of such profligate spending will be the very financial markets whose ever onward and upwards growth (in terms of non-inflation adjusted dollars) reflects the Federal Reserve's uncanny ability to reduce interest rates whenever it appears a bubble is about to burst, or to print a whole bunch more money to inject into the system, so that, for instance, the President's brother and then governor of Florida, could shortly before the Enron scandal broke, buy a large amount of Enron stock for the Florida State Teacher's Pension fund, and other large pension funds could invest in subprime mortgage tranches with notational values in excess of $50 trillion dollars, which has already seriously undermined the private pension systems of some large corporations (but fortunately for retired Supreme Court Justices, not any federal government pension systems).
And given our nation's dependence on the developed and developing worlds to manufacture things no longer made in America, and the world's abhorrence of the Bush doctrine of preemptive military strikes on non-nuclear nations with lots of oil reserves, the world's fears of the weakness of the U.S. dollar, and the world's keen understanding that a credit based consumer economy, such as the U.S. has had for many years now, is unsustainable, and that in order to minimize the shockwaves from the foreseeable perpetual American financial crises, our allies in Asia and Europe are disassociating themselves from us, and making trade agreements among themselves to which we have ever less say. We are not being invited to the party as much anymore, when before, the party could not be held without us.
Our government was founded on the principle that the legitimacy of law derives from the consent of the governed. Today's youths and future generations have not been consulted in the writing of our current social contract. Yet they soon may face financial burdens that most voters would find intolerable.
The present Bush administration was founded on the principle that the Clinton administration had wiped out the legitimacy of having a Democratic President for at least four years. We all agreed to it. All five of us. And all nine of us agreed that none of us would retire until the end of the Bush administration's first term of office. The voters of 2000 were not consulted in the electing of the present administration. Yet they already face financial burdens that voters from previous decades would find intolerable.
As we approach this vast expansion of spending, precipitated by a combination of aging baby boomers and abnormally high health costs, it is time to consult our young. That is exactly what we hope to do through the Youth Entitlement Summit taking place today and tomorrow on Capitol Hill.
As we approach the end of the most wanton expansion of deficits, illegal wars, unconstitutional wire taps, illegal torture, continual shredding of the bill of rights, precipitated by a combination of an ever dwindling number of corporate media outlets, all of which supported Bush's war and excluded voices of dissent, a nation made ever dumber by TV pundits with an overt radical Republican agenda, aging infrastructures, violent weather occurrences which are predicted by the inconvenient truth of global warming, it is time for you all to show your altruism.
It's time that you fixed it ... for the sake of the children. And in so doing, that you let any of my and my fellow Supreme Court Justices culpability for the current state of disaffairs slip rapidly out of sight, down the forgotten memory hole.
The youth activists assembling for this meeting know that although 41 percent of Americans are younger than 30, their political clout is inherently limited. Despite turning out in record numbers this year, voters ages 18 to 29 have accounted for only 13 percent of the presidential primary electorate. In the future, demographics will relegate youths to an ever-shrinking electoral minority.
All I am saying, is give these [youth] a chance. Entrust it all to the under 30 set. Otherwise, you will have no one to blame it on, except yourselves. In the future, demographics will relegate youths to an ever-shrinking electoral minority, UNLESS OF COURSE, you decide to let old people die sooner (and poor people too). In which case, youth will be served.
Do it for the sake of the children. Because, I really don't want to think about how guilty I am in all of this.
Far from being a classic struggle of special interests, the representation of younger and future generations depends on the informed selflessness of their elders. Older generations must allow Congress to fix Social Security. Much can be achieved through practical changes that need not affect those in or near retirement.
Far from being a classic struggle of class war fare, the representation of younger and future generations depends on the informed selflessness of their elders. So, all you old people, move to the most polluted states, like Texas, where you can die sooner. All you black people, commit more crimes so you can be imprisoned, impoverished, and die younger, and not be such a burden on the system.
The larger and more urgent task is health reform. In the interests of effective cost control, Medicare beneficiaries in particular must be prepared to embrace sensible limits on the way their health care is provided. Halting runaway medical inflation represents a potential victory for all generations.
The larger and more urgent task is health reform. While it's very important that big pharma remain as profitable as it has become, and that health insurance companies remain viable, because they employ three million people, we can't continue to spend so much money on old folks.
Our country must recognize that an overreliance on taxation poses real economic risks. We cannot grow our way out of this budget challenge. Yet its magnitude is such that we cannot hope to meet it without creating new wealth.
Our country must never recognize that relying on taxes for government programs poses real economic risks. We cannot spend our way out of this budget challenge. Yet its magnitude is such that we cannot hope to meet it -- because we cannot create new wealth. We can only accelerate the accumulation of old wealth.
The impressive involvement of young Americans in this presidential election provides a golden opportunity for our next president to face this dilemma -- and to cast aside political orthodoxy in fashioning a bipartisan agenda of reform. Anything less risks undermining the noble experiment that began 232 years ago.
The impressive involvement of young Americans in this presidential election provides a golden example of P.T. Barnum's old saying - there's a sucker born every minute. And a golden opportunity for our next president to face this dilemma -- and to cast aside political orthodoxy in fashioning a bipartisan agenda of reform. And if, heaven help U.S., if the next President is a Democrat, let me define bipartisan: bipartisan means that what the Republican party wants, the Republican party gets, otherwise, they will shut down the legislative branches of Congress, going nuclear, if they must.
Anything less risks undermining the noble experiment that began almost 8 years ago, when my fellow justices and I decided (albeit to my later regret) that the nation had had enough of Clinton (and by extension, Gore was Clinton) and needed more shrub.
Anything less, and I might have to feel responsible, in part, for some of this.
Sandra Day O'Connor served as an associate justice of the Supreme Court from 1981 to 2006. James R. Jones was ambassador to Mexico from 1993 to 1997. They are honorary co-chairs of the Youth Entitlement Summit.
