On Facing the Future, Concord Coalition Executive Director Robert L. Bixby, Senior Fellow at the Manhattan Institute Brian Riedl and Director of the Center for Funding America’s Future at the Progressive Policy Institute Ben Ritz join me for the show’s 100th episode. Bixby, Riedl and Ritz give a preview of the conversation they will have at the College Convention in Manchester, New Hampshire, titled An Intergenerational View: The National Debt.
All three shared why the growing national debt is of concern to each of their generations, Millennials, Gen X and Baby Boomers.
Ritz, a Millennial, said, “the big reason I think the national debt matters to our generation is that we are going to be the ones saddled with the cost for years to come, and that has a lot of implications.” He was especially concerned with how the cost of significant and growing debt is limiting the nation’s ability to invest in the future.
Riedl, a Gen Xer, said his is a generation that is focused on both the taxpayer and retiree side of the issue. “This matters to my generation because we have one foot on both sides,” he said. “On the one hand … we’re going to be paying taxes for another 30-35 years … on the flip side, theoretically, I’m supposed to be retiring in about 25 years … and my generation is not exactly counting on Social Security and Medicare to fully take care of us in its current form.”
Bixby, a Boomer, jokingly said he speaks with a bit of a guilty conscience. “We have done very little to prepare for the long-term fiscal outlook, and the Baby Boomers have now eased into their later years … that means the whole generation is now going to be grandfathered in to any changes,” he said. “We wasted an opportunity to take action 20 years ago; it’s not like no one saw this coming.”
The demographic impact on the budget was projected long ago. We failed to do anything about it, and under the Baby Boomer’s watch, we have largely made the problem worse, he said.
On trends to watch out for and address, each had their own take.
Bixby said, “I think the most important trend that I would look at is to take a long view of the federal budget, and to realize that if you don’t make any changes, the debt will continue to rise because spending rises faster than revenue.”
Riedl said his focus is on the drivers of the long-term debt. “If you take a look at the Congressional Budget Office’s 30-year projections, they assume $80 trillion in deficits over the next 30-years,” he said. “And if you break that down, they project that Social Security and Medicare will run a $103 trillion cash shortfall and the rest of the budget will run a $23 trillion surplus.”
Ritz said the big trend he would focus on is the decline in public investment spending. He said the budget for such spending has dwindled from 2.5 percent of GDP in the 1980s to about 1.5 percent of GDP now. “Over the next decade and beyond, it’s going to continue falling further to well below its lowest point in modern history,” he added.
Bixby warned against continuing these and other fiscal trends. “If you want limited government and low taxes, fine; if you want higher spending and higher taxes, fine,” he said. “What we cannot do, and we are now doing by default, is having higher spending and lower taxes.”
He called it politically attractive, but also reckless, foolish and disingenuous fiscal policy.
Hear more on Facing the Future. I host the program each week on WKXL, NHTalkRadio.com (N.H.), and it is also available via podcast. Join me and my guests as we discuss issues relating to national fiscal policy with budget experts, industry leaders, elected officials and candidates for public office. Past broadcasts are available here. You can now subscribe to the podcast on iTunes, Google Play or through RSS.
Facing the Future will once again be fielding your fiscal-policy related questions. Later this month, we will dedicate a show to your thoughts and concerns, as well as suggestions on what topics we should cover in more detail in 2020.
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