The so-called “fiscal cliff” is approaching. Though I have no inside information on the talks between congress and the president, I nonetheless sense a kicking the can down the road solution to temporarily avoid an across-the-board tax hike and severe budget cuts that even both democrats and republicans agree are unacceptable.
Trouble is that the easy “permanent” solution is to devise some debt-reducing plan that takes 10 or so years to pay off. That’s a few different congresses and presidents and whatever long-term plan enacted can be easily undone by either of them. We need something tangible over the next three years. But how to do that is the rub. Social Security by far is the spending program with the most long-term expenditure. Over the next 15 to 25 years, the largest generation in human history will be entering retirement, and there will not be people from the younger working generations to pay for them (though after this sizable hump, the ensuing generations’ sizes become much more manageable.)
Increasing the full retirement age will save money, but with that comes many dangers and potentially more government spending. There is ageism in just about all workplaces — younger people are willing to work for less and older people raise insurance premiums for a buying pool, making it very challenging for a person who is 67 years or older to get full-time employment. That’s a social program waiting to happen because many, many people will simply not have enough to retire. Some are to blame for that; others are not.
One way to overcome this is to offer significant tax incentives to companies that hire older Americans so as to offset higher insurance costs and the wage differential between them and younger workers. Providing for our senior citizens should be an ethical priority. Handling this aspect of our pending increasing debt in this way at this time can help ensure that our seniors will be taken care of while reducing our debt. If we don’t do this or something like it, we’ll in essence be driving older Americans off a cliff not at the end of December but for many years to come. And that is a can we must not kick down the road.
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