Fiscal Realism

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I keep returning to the sentiments of Reality Check – that we need to realize that on tough issues we will not be able to satisfy everyone and that the decisions we make must be based on what is best and not merely based on what offends the fewest people. This comes up again as I read the platform for Divided We Fail. This is an initiative of the AARP. I do not wish to accuse the AARP of not caring for the future, but I think it is fair to note that when push comes to shove the best solution for the next 5 years is going to be more favorable to the AARP than the best solution for 30 years from now.

Their platform consists of 6 points – 3 on social security and 3 on health care:

• All Americans should have access to affordable health care, including prescription drugs, and these costs should not burden future generations.
  • This sounds like a noble and universal sentiment.
  • We can deduce from their other points that the path they envision is one of government backed health care which is not possible without being a burden on future generations so this goal is unattainable in its fullness – one part has to give.
  • For more insights here go read No Free Lunch.
• Wellness and prevention efforts, including changes in personal behavior such as diet and exercise, should be top national priorities.
  • Absolutely. This is the one undeniable truth, and the single most influential factor in the rising costs of our current health care system. How do we go about doing this?
• Americans should have choices when it comes to long-term care – allowing them to maintain their independence at home or in their communities with expanded and affordable financing options.
  • Agreed. Only, what “affordable financing options” do they have in mind?
• Our children and grandchildren should have an adequate quality of life when they retire. Social Security must be strengthened without burdening future generations.
  • Everyone (the AARP as well as their children and grandchildren) deserves an adequate quality of life when they retire. We might need to define “adequate quality of life” because what that seems to be today may well be unsustainable.
  • On the other hand, there is no possible way to strengthen social security without increasing the burden on future generations. Some generation is going to have to take the fall on this one. The program needs to receive its sunset – Sadly, I feel compelled to volunteer my generation. I don’t expect to receive social security benefits. Even if social security benefits are still available I hope not to avail myself of that benefit. (Why should I be a burden to my posterity?)
• Workers should be provided with financial incentives to save, should have access to effective retirement plans, and should be able to keep working and contributing to society regardless of age.
  • I agree.
• Americans of all ages should have access to tools to help manage their finances, and save for the future and better, easy to understand information to help them increase their financial literacy and manage their money wisely.
  • This is another point that sounds good but the pessimist in me is skeptical that we will ever really educate the majority of our population on money matters.
  • I also believe that managing money more wisely requires more than financial literacy – it requires a new attitude about the value and nature of wealth. So long as we are driven to keep up with the Joneses financial literacy won’t make us wise managers of our money.