In the future, older Americans will be able to determine who our elected leaders will be, as well as what policies will be put in place. What will make this happen? Sheer numbers are part of the answer. Forty eight million baby boomers will be 60 years and older in 2005 and one out of every nine boomers is expected to live to age 90. 
    Equally important, seniors have a great deal of political influence because they represent the largest bloc of voting citizens who actually vote. At the same time, senior organizations such as AARP have shown increased lobbying clout, tilting the political balance in favor of their 50+ members.
     What about today’s youth and the their political passions? Unlike their parents, who were politically active in the 60s anti-war and civil rights movements, many of today’s youth are both cynical and apathetic about public life. They think that they will be on the short end of the stick, when it comes to retirement benefits both from the companies they work for, and the government
     What about senior power elsewhere in the world? Peter Peterson in the book, Gray Dawn, says it’s on the rise in Europe.  In the Netherlands an age-based the “Pension Party” has already formed. In Russia the Communist Party has partly rehabilitated itself as the party of and for elder retirees.
      The only country that has tried to create some equity between the generations is the country where the age wave hit first -Japan.  In 1986, when Japan’s leaders enacted a major reduction in pension benefits, they said what the government gives can also be taken away if entitlements prove to be too costly for the government. After public discussion, the new fiscal policy went quietly into place. 
      In our country, there is a dichotomy. Although our culture is youth-obsessed, seniors are the group with the most political clout. Our leaders, however seem to be in denial over the growing differences in priorities between younger and older Americans.
      The areas where potential intergenerational clashes will most likely occur involve how our country’s financial resources will be allocated and the manner in which its citizens will be taxed. Older Americans believe their health and financial security depend on Social Security and Medicare benefits remaining intact. In fact, with escalating health care costs, seniors hope to see Medicare benefits extended to include more services such as prescription drugs. Younger Americans, on the other hand, want to be more independent, don’t trust the government, and don’t want to be strapped with paying taxes for so many retired workers.  A well paying job with good benefits payments is a top priority. Today’s younger workers see that retired workers over the past 30 years have done very well economically. They don’t believe they will do as well. Another difference comes in the area of education. For young parents, the quality of their children’s education is very important. Seniors, on the other hand, sometimes vote down school budgets. Throw in the mix of an uncertain economy, an unbalanced federal budget, and a bloodied stock market, and you might just have the recipe for “intergenerational warfare.”                                                   

What do we need to do to avoid a future confrontation between working-age taxpayers and the exploding number of retirees they will be asked to support?

1. We must first acknowledge that the young and the old may have different needs at different stages in their lives.

2. The next step is to realize that providing for the largest generation of seniors in history, while simultaneously investing in education and job opportunities for tomorrow’s workers, will require major policy changes.

3. I agree with Richard D. Thau, co-author of the book, Generations Apart, that boomer-age politicians will have to make radical fiscal reforms. There needs to be some kind of means testing for the entitlement programs - social security and Medicare.  When you think about it, we already have means testing in many parts of our life. For example college scholarships, getting a mortgage, property tax relief, and our individual taxes are all based on our individual strengths and weaknesses. Not everyone receives equal treatment. 

4. I strongly believe that the fiscal reform for Medicare and Social Security benefits should be called affluence testing.  Middle class and upper income seniors will have to forgo part of their federal benefits. This will be based on some kind of legislated formula with entitlements, perhaps, indexed to longevity.

5. Benefits to low-income seniors will remain the same, may even be raised.

6. As for working Americans, they will out of necessity be forced to save a higher percentage of their income, if they want to have a financially secure old age. Americans, who are the world’s worst savers, will have to have strong incentives to do this, possibly in the form of tax credits.

        I hope America will grow up before it grows old. Its important for older Americans to give our children and grandchildren the same unburdened economic opportunities we had. The demographic time bomb is ticking. Now is the time to defuse it.