Hacker News Reader

> Baby Boomers are directly responsible for all the debt in the country,

Not just that, but the sad state of infrastructure, the condition of the environment, and climate denial. If WWII was the crucible of the greatest generation, then the (relative) peace of the 60s and 70s was the cradle of the worst generation. We (I'm 38) are now inheritors of a pretty messed up world on a very dangerous trajectory. I hope we can muster the courage to face it instead of being led like zombies toward our tech fantasies (myself included).

Social Security was founded in 1935, so before boomers ever were born, although it had a different feel from today's program. Social Security is funded (you actually pay taxes for it), but the rest of the government borrows from it quite recklessly which is why republicans want you to believe it's not funded. With simply upping the ceiling on the amount taxed into it we can easily fund it for the foreseeable future. Now of course the right wants you to think otherwise so they can kill the program for future generations but that's just not backed up by facts.

Upping the contribution limit without upping the benefit would just be a hidden tax on the upper middle class, but not the rich, who do not work for salary. If you want to tax the rich, you need to raise the upper tax rates.

You need to implement social security taxes on investment income, not raising the SS taxable cap on wages, to accomplish this. It makes sense to not overly tax burden wage income (productive effort) while taxing investment income (rent seeking) at a higher rate, no?

I'd just go with adding all income (investment or otherwise) into a total pool and then tax that with a single set of rules instead of this stupidly complex tax system.

It's exactly the opposite of hidden. It literally shows up as a separate item on your taxes. However, I don't think most people actually realize that it's a regressive tax that goes away when you make more money. Though society is at a place where a lot of people don't care if elderly people starve and freeze to death just as long as the upper class get slightly lower tax burdens.

It's disingenuous to say that the government borrows from SS. The SSA needs a savings account for its money and the Treasury offers that, though T-Bonds.

It's two sides of the same coin with totally different implications. It's, "I bought a CD." vs. "The bank keeps borrowing from me."

> Medicare/social security didn’t exist before the boomer generation

Patently false. In the US, Social Security was instituted as part of Roosevelt's New Deal in 1935. From a more global perspective similar systems have been around much longer.

Sorry Medicare and medicade. It doesn’t matter if similar systems have been around much longer, governments have been around much longer than The US government and none of them are $21T in debt.

Sure but there are a lot of countries with larger debt to GDP ratios.

I'm pretty sure that the 21T does not include future payouts to social security or medicare. I believe that if you do include them, the number goes closer to 100T.

The US' national debt was 89% of GDP in 1950. Now it is 104%. [1] I somewhat agree with you (there was a long period in between when the debt-GDP % was much lower), but the current situation isn't as dire as you suggest.

1. https://www.thebalance.com/national-debt-by-year-compared-to...

Weren't there some expensive wars around that time? I think I'm recalling that correctly.

Seriously, though, a fairer point of comparison might be the late '60s and early '70s - right when Boomers were entering adulthood. National debt as a percentage of GDP was in the 30s around then.

Still, your response to the parent comment is still somewhat justified - yes, national debt is higher now, but it's not like it's orders of magnitude higher, right?

Yeah, it's not an unprecedented situation. What's concerning is that we have this level of debt after a period of relative peace and stability. (Though I vaguely recall there being some expensive wars recently too.)

To a first approximation, only foreign-held debt matters

https://fred.stlouisfed.org/series/HBFIGDQ188S

https://en.wikipedia.org/wiki/File:Composition_of_U.S._Long-...

>but the current situation isn't as dire as you suggest.

But I didn’t say it was dire, that’s you reading “dire” into facts and numbers, which should be telling.

You implied that millennials are screwed because boomers incurred too much debt. Sounds pretty dire to me.

I agree with most of this except the part about inventing debt; come on now, debt has existed as a concept far back into human history.

EDIT: Yes all, I understand credit is now more easily available than ever, and I would argue that ease of credit is a substantial problem allowing for the transfer of responsibility to future generations.

@infogulch: I agree with everything you said, but that is not what OP said, and hence, not what I replied to. Internet Talking is hard!

Last evening while we were out to beers, a friend recommended me a book apparently reviewing precisely this history: https://www.amazon.com/Debt-First-5-000-Years/dp/1612191290

Yes, this was the book I was thinking of when I wrote my comment. Do read it, it's fantastic.

Yes it has existed before but never so readily available. I believe credit card was first introduced in 1950's and modern mortgages in 1930's.

Sure but what's fair in terms of debt was seriously limited. Now with payday loans all bets are off.

Yes, but you couldn't spend it like water until the credit card. And that started with the Diner's Club card in 1950: https://en.wikipedia.org/wiki/Diners_Club_International

That is absolutely correct, paying back debt has existed nearly as far back as we have recorded history in the form of slavery / indentured servitude.

But, not to put words in OP's mouth, I don't think that's what OP was saying. Baby boomers have normalized the concept of average people using debt to get things they want now but can't afford, and millennials are the first generation that has grown up with it pervasively.

Debt is a powerful tool for enabling opportunities when the decision is highly calculated and considered. For example a business that can directly weigh a break-even point for going into debt to make an investment that would simply have not have been possible otherwise. Or perhaps buying a house (though that is a bit more debatable these days).

When people "just put it on the CC", that debt is not carefully calculated or considered. When people go to college without a path to a career that can pay it back it's also not calculated or considered.

Debt is like a scalpel, but individuals use it like it's a hammer.

Well in My comment I expressly state the US federal debt was at $250B in 1950, so I know debt existed before baby boomers. My comment really set off the pedantics.

My Great Uncle Joe served in World War II. 4 years tromping around Europe. In his 80's, he still woke up at night, screaming. So his wife would tell us; he never spoke much about that. She lost her first husband, Fred, to the war. Society calls them "The Greatest Generation".

They couldn't have kids. But they ended up running a drive in, where the kids who worked for them became like family. They put more than one through college, and took one in when he needed a home. Decades later, those kids would call and visit them.

Well, those kids may have turned out pretty well. But, generally, I've come to think of those who came after this "Greatest Generation" as "The Selfish Generation".

Really, we're speaking of more than one generation, here. The symbolic touch phrase might come from the 1980's, written in the movie "Wall Street":

Greed is good!

To which I might respond, "Divided we fall."

As it turns out all this bullshit about millennials not wanting to get married, or own houses, or own a car is manufactured news

Well yes, that is after all a central point made by the article:

“We find little evidence that millennial households have tastes and preference for consumption that are lower than those of earlier generations, once the effects of age, income, and a wide range of demographic characteristics are taken into account,” wrote authors Christopher Kurz, Geng Li and Daniel J. Vine.

How are boomers as a generation of people responsible for the '78 Supreme Court decision to allow national banks to export the interest rate law of their home state into any state where they do business?

Thats what caused the credit card explosion

https://www.creditcards.com/credit-card-news/marquette-inter...

Credit card debt is a small percentage of overall household debt.

> they invented it to pay for their lavish life styles they couldn’t afford

Debit does not work that way over the entire economy. It can change the distribution of wealth, it can incentive people to act differently, it can change the cost of transactions. But it can not anticipate future wealth.

seems like a generalization to say 'baby boomers directly responsible for...' How do you consign direct responsibility to a group of people only tied together by their year of birth? Are you sure you are not yourself unconsciously kicking the can down the road through some horrid act or inaction on your part?

The argument is that the baby boomers, by being a demographic bulge, have a relatively large electoral influence and so over time government policies have been disproportionately targeted to their changing needs.

While 'directly responsible' is a bit of a stretch, at least in the UK voting preferences are currently quite correlated with age (though this hasn't always been the case). Because the current crop of older people are much more likely to vote than younger people, the political parties have made various commitments to protect and increase social security for pensioners. These pensioners are of the same generation that had free education in the 60/70s and then voted for tax cuts in the 80s when they were earning, of course.

Yes it is a generalisation, it's far from the only factor that determines policies and the demographic bulge isn't as pronounced in the UK as it is in the US but I still think it's interesting to see how government policies have changed to follow the bulge as it ages. Of course, many baby boomers will tell you that they paid taxes all their lives, thank you very much, and had mortgage rates of 25% etc etc etc.