Sold Out Futures By State: English Version

The Intergenerational Foundation over in the U.K. asked if I could summarize my research on U.S. intergenerational burdens at the state and local government level in 700 words or so.  I somehow managed to squeeze a summary into about 1,700 words, which was subsequently modified for local spelling and syntax.   I generally don’t write posts that short because what is left is a series of statements without all the data, sources, evidence.  But if you are prepared to take my word for things and want my best effort of a brief summary of the situation, you might want to read this.

http://www.if.org.uk/2019/01/15/generational-inequity-in-the-usa-state-and-local-government/

 

 

If you want all the proof, you can follow these links, following the further links from each of my posts or downloading the spreadsheets where you want to go further.

Provided older generations with old age benefits far in excess of what they had been willing to pay for in taxes while working, borrowing the difference and leaving later-born generations to face a future of higher taxes and diminished benefits.

One might read a four post series on Social Security starting with this one, with the one following linked at the bottom.

https://larrylittlefield.wordpress.com/2015/01/10/reprised-social-security-the-generational-betrayal/

Or this post.

https://larrylittlefield.wordpress.com/2014/08/10/generational-equity-and-the-legacy-of-todays-politicians-update/

Or this one.

https://larrylittlefield.wordpress.com/2016/02/09/the-phony-federal-campaign-and-our-real-future/

The downside of the sexual revolution has left a smaller share of children with stable families during childhood.

https://larrylittlefield.wordpress.com/2014/08/13/generation-greed-and-the-family/

Diminished economic opportunity, despite higher educational attainment and a lower level of personally destructive and anti-social behavior (crime, vandalism, drug abuse, teenage pregnancy).

Any these are a start.

https://larrylittlefield.wordpress.com/2014/12/27/falling-wages-its-not-just-the-millennials-and-its-not-just-the-business-cycle/

The social benefits the federal government provides to seniors, notably health insurance, are generally limited to them, while the workers who pay for it get less or nothing.

I discussed trends in health care in this post.

http://r8ny.com/2006/07/01/socialized-medicine-get-real-its-already-here/

The degradation of Obamacare, the one thing that has been done for those under 65, or raising the eligibility age for Medicare for later born generations, as has been proposed, would make it worse.  As it is, labor force participation is rising for those over 65 but not those ages 55 to 64, because employers that provide health insurance don’t want a premium increase.

male labor force participatin

The generations born after 1957 have been paid significantly less on average at each point in their lives than those born between 1930 and 1957.

https://larrylittlefield.wordpress.com/2013/11/10/donald-trump-the-man-of-his-generation/

https://larrylittlefield.wordpress.com/2019/04/02/the-generational-war-has-been-going-on-for-decades/

https://larrylittlefield.wordpress.com/2019/05/25/retirement-benefits-are-to-white-collar-crime-and-generational-inequity-what-handguns-are-to-street-crime/

And those born since 1981 (the Millennials) have been paid significantly less than those born from 1958 to 1980 (the back end of the Baby Boom and Generation X).

Or, for that and a summary of the effects of rising total debt in the economy:

https://larrylittlefield.wordpress.com/2017/04/25/generation-greeds-last-economic-orgy-federal-reserve-z1-debt-data-for-2016-rising-housing-prices-census-bureau-data-on-worse-off-young-adults-falling-life-expectancy-etc/

As a marker of how bad things are here, the death rate of those born after 1957 has been higher at each age than it had been for those born previously, and life expectancy is falling, with a higher suicide rate at each age a leading cause.

https://larrylittlefield.wordpress.com/2015/11/08/death-is-the-ultimate-statistic-ii-the-most-important-news-in-ten-years/

Of the three levels of government, the federal government attracts the most attention and collects the most in taxes. But it pays most of its revenues right back out again in payments to individuals and the healthcare industry as part of the so-called entitlements, aid payments to state and local governments, and interest in the national debt, and actually does very little directly other than national defence and the post office.

https://larrylittlefield.wordpress.com/2016/02/21/federal-expenditures-a-government-transformed/

The sold out future analysis started with this post, which showed the U.S. average trend and explains where the data came from and how it was calculated.

https://larrylittlefield.wordpress.com/2018/12/06/sold-out-futures-a-state-by-state-comparison-of-state-and-local-government-debts-past-infrastructure-investment-and-unfunded-pension-liabilities/

State and local governments are required to have balanced budgets, with debt in theory only used for long-term capital investments. In 1981 the total state and local government debts for the entire country equalled 14.1% of personal income of all US residents, but then soared to 20.1% of personal income in 2007, before subsequently falling back to 18.6% in 2016. State and local government infrastructure investment, however, went in the other direction.

https://larrylittlefield.wordpress.com/2018/12/12/sold-out-futures-by-state-in-2016-debt-and-infrastructure/

State and local governments have also promised their own employees far more generous retirement benefits that most Americans get, often retroactively increasing those benefits in deals with public employee unions for political support.  But to keep taxes low and opposition limited, have failed to fully pre-fund them.

https://larrylittlefield.wordpress.com/2018/12/16/sold-out-futures-by-state-public-employee-pensions-in-fy-2016/

All in all, the on-the-books state and local government debts, and the off-the-books debts implied by inadequate past infrastructure investment and public employee pension underfunding, add to a mortgage at 46.9% of the average American’s personal income that they will have to carry for the rest of their lives.  Over and above the generational inequities at the federal level in government, in the private sector, and even in many families. But the extent of this burden varies from place to place.

The ranking is discussed in this post, which also shows the trend in the overall state and local government tax burden, the total wages of public workers still on the job, and how much property taxes would have to rise in each place to pay off the total intergenerational burden as a 30 year mortgage.  (Doubling, tripling, etc).

https://larrylittlefield.wordpress.com/2018/12/20/sold-out-futures-by-state-the-sold-out-future-ranking-for-2016/

The only way later-born generations could fight back is to refuse to buy older generations’ houses unless (and until) the price fell so low that lower housing costs offset all the state and local government disadvantages they are inheriting. But it turns out that Generation Greed benefited from lower housing costs too, and is now using its control of government to drive public policies to keep housing prices for later-born generations high as well.

https://larrylittlefield.wordpress.com/2017/12/09/fannies-mae-and-freddie-macs-stealth-economic-war-on-the-millennials/

Or try these.

https://larrylittlefield.wordpress.com/2014/08/24/repost-how-then-shall-we-live-housing-in-the-wake-of-generation-greed/

And

https://larrylittlefield.wordpress.com/2014/11/23/the-new-urban-crisis/

followed by

https://larrylittlefield.wordpress.com/2014/12/06/can-the-urban-archipelago-be-recreated/

Etc.