The Coming Generational Storm: What You Need to Know about America's Economic Future

The Coming Generational Storm: What You Need to Know about America's Economic Future

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by Laurence J. Kotlikoff, Scott Burns
     
 

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In 2030, as 77 million baby boomers hobble into old age, walkers will outnumber strollers; there will be twice as many retirees as there are today but only 18 percent more workers. How will America handle this demographic overload? How will Social Security and Medicare function with fewer working taxpayers to support these programs? According to Laurence Kotlikoff and

Overview

In 2030, as 77 million baby boomers hobble into old age, walkers will outnumber strollers; there will be twice as many retirees as there are today but only 18 percent more workers. How will America handle this demographic overload? How will Social Security and Medicare function with fewer working taxpayers to support these programs? According to Laurence Kotlikoff and Scott Burns, if our government continues on the course it has set, we'll see skyrocketing tax rates, drastically lower retirement and health benefits, high inflation, a rapidly depreciating dollar, unemployment, and political instability. The government has lost its compass, say Kotlikoff and Burns, and the current administration is heading straight into the coming generational storm.But don't panic. To solve a problem you must first understand it. Kotlikoff and Burns take us on a guided tour of our generational imbalance, first introducing us to the baby boomers -- their long retirement years and "the protracted delay in their departure to the next world." Then there's the "fiscal child abuse" that will double the taxes paid by the next generation. There's also the "deficit delusion" of the under-reported national debt. And none of this, they say, will be solved by any of the popularly touted remedies: cutting taxes, technological progress, immigration, foreign investment, or the elimination of wasteful government spending.So how can the United States avoid this demographic/fiscal collision? Kotlikoff and Burns propose bold new policies, including meaningful reforms of Social Security, and Medicare. Their proposals are simple, straightforward, and geared to attract support from both political parties. But just in case politicians won't take the political risk to chart a new direction, Kotlikoff and Burns also offer a "life jacket" -- guidelines for individuals to protect their financial health and retirement.This paperback edition of The Coming Generational Storm has been revised and updated and includes a new foreword by the authors.

Editorial Reviews

Library Journal
Kotlikoff (economics, Boston Univ.) and personal finance writer Burns paint a bleak picture of the future U.S. economy. They claim that a "generational storm" will occur when baby boomers start to retire, leaving fewer people in the workforce to support the massive programs on which the boomers will be depending. Focusing on three programs that they feel are ailing-Social Security, Medicare, and Medicaid-the authors argue that administrations past and present have misled the public on the health of the economy and that our children will be left with a huge financial burden if the government continues on its course of fiscal irresponsibility. The first chapter details the aging population, and the entire text is heavy on statistics and calculated financial scenarios. The authors end by outlining their own solutions to the troubled economy. This is a sobering look at an impending crisis with implications for all of us. Recommended for all collections.-Stacey Marien, American Univ. Lib., Washington, DC Copyright 2004 Reed Business Information.
Dallas Morning News - Chris Tucker
...filled with advice on protecting what you've got and making it grow before and during retirement.

Los Angeles Times - Gregory D. Hess
The Coming Generational Storm...lays out in easy-to-understand prose why Social Security and Medicare need a comprehensive overhaul.

National Journal - Anne Wagner
...Kotlikoff and Burns proffer plenty of evidence to back up their claims.

Business Week - Michael Mandel
The policy solutions of Kotlikoff and Burns are specific and ingenious....

The Financial Times - Alan Beattie
...[A] serious attempt to look at a problem that most people are trying to ignore.

The New York Times - Nicholas Kristof
...excellent and scary...

The Wall Street Journal - Todd G. Buchholz
Having painted a fiscal picture as awful as 'Guernica,' the authors unveil two bold plans...[An] engaging book.

The Washington Post
The Coming Generational Storm lays out the problems in understandable language and compelling detail.

National Post - Jonathan Chevreau
This is a book any serious investor should absorb and act upon.

CHOICE
This may be the year's most important book. Essential.

From the Publisher
"...Filled with advice on protecting what you've got and making it grow before and during retirement." Chris Tucker Dallas Morning News

" The Coming Generational Storm...lays out in easy-to-understand prose why Social Security and Medicare need a comprehensive overhaul." Gregory D. Hess Los Angeles Times

"...Kotlikoff proffer plenty of evidence to back up their claims." Anne Wagner National Journal

"The policy solutions of Kotlikoff and Burns are specific and ingenious...." Michael Mandel Business Week

"...[A] serious attempt to look at a problem that most people are trying to ignore." Alan Beattie Financial Times

"excellent and scary" Nicholas Kristof New York Times

"... Filled with advice on protecting what you've got and making it grow before and during retirement." Chris Tucker Dallas Morning News

"Having painted a fiscal picture as awful as 'Guernica,' the authors unveil two bold plans....[An] engaging book." Todd G. Buchholz The Wall Street Journal

" The Coming Generational Storm lays out the problems in understandable language and compelling detail." The Washington Post

"...Kotlikoff and Burns proffer plenty of evidence to back up their claims." Anne Wagner National Journal

"The policy solutions of Kotlikoff and Burns are specific and ingenious..." Michael Mandel Business Week

"This is a book any serious investor should absorb and act upon." Jonathan Chevreau National Post

"This is a sobering look at an impending crisis with implications for all of us. Recommended for all collections." Stacey Marien Library Journal

"This may be the year's most important book. Essential." R. M.

Whaples CHOICE

Product Details

ISBN-13:
9780262250153
Publisher:
MIT Press
Publication date:
01/18/2005
Sold by:
Barnes & Noble
Format:
NOOK Book
Pages:
302
Sales rank:
819,630
File size:
1 MB

What People are saying about this

Paul A. Samuelson
Among academic experts, Larry Kotlikoff has earned the title 'Mr.

Generational Accounting.' His unfuzzy arithmetic decisively rebuts the Bush tax cuts, which are based on the delusion that 5 - 4 = 6, not 1. Read and judge for yourself the specter of our future: too many retirees dependent on too few working-age people. Fiscal imprudence now mandates broken promises later.

Kevin A. Hassett
If Stephen King wrote about economics it would look like this. Kotlikoff and Burns have gazed into our future and seen a nightmare. The authors describe that nighmare vividly and identify why our elected officials on both sides of the political aisle are too cowardly to save us. Every U.S. citizen should read and digest this book before it is too late.

Robert J. Shapiro
The Coming Generational Storm is one of the most important (and refreshingly irreverent) policy analyses of recent years. Laurence Kotlikoff and Scott Burns ask what will happen to our economy and way of life when the baby boomers meet the current Medicare and Social Security systems. Their answers, using the innovative techniques of 'generational accounting' developed by Kotlikoff and others, demonstrate how close we are to a genuine fiscal precipice and the hard landing that awaits us. For our current presidential aspirants, the authors also provide some provocative ideas for how to ameliorate the damage this storm will certainly leave in its wake.

James J. Heckman
The Coming Generational Storm is a well written summary of an impressive and important body of carefully documented research. The book demonstrates clearly the folly of existing tax and transfer policies in the face of the impending retirement of the baby boom generation. Anyone interested in the future economic viability of American society and the economic problems we are bequeathing to our children should read this study.

James M. Buchanan
Between a rock and a hard place. We must all too soon realize that we want to spend more on transfers (Social Security, Medicare, Medicaid) than we are willing to pay in taxes. And the prospective $44 trillion shortfall is, almost literally, beyond ordinary comprehension. Documented diagnosis, along with suggested reforms, are first steps toward constructive dialogue.

Sylvia Nasar
Brilliant insights on the me generation vs. the next generation. Better still, smart advice on equally vexing questions like whether to invest in a 401(k) or a second mortgage.

Robert J. Shiller
There's a lot of frivolous criticism of our politicians, but this book hits the mark, convincingly documenting their biggest sin: the failure to account for the magnitude of a huge government deficit crisis. The accounting scandals of Enron, WorldCom, and Parmalat pale by comparison. Read this book so you can start preparing for much higher taxes in the future for you and your children.

Niall Ferguson
Kotlikoff has been one of the pioneers of the new economics of generational accounting. If anyone foresaw the deterioration of the U.S.

government's fiscal health, he did. Now, with journalist Scott Burns, he has written a book that spells out, in crystal-clear layman's terms, the disturbing truth about the rising tide of red ink.

Peter G. Peterson
As someone who has written extensively on global aging and its profound implications, I was delighted to read The Coming Generational Storm. It is an extremely important and original contribution.

Jeffrey D. Sachs
No economist has thought more clearly or spoken more resolutely about our long-term fiscal challenges than Larry Kotlikoff. In plain talk backed by economic rigor and the powerful models that he and his colleagues have pioneered, Kotlikoff and coauthor Scott Burns expose the shoddy thinking and false premises that lie at the heart of U.S. fiscal policy and that risk the economic well-being of future generations. They show how reckless George W. Bush has been with our economic future, but also show that the evasions from fiscal honesty extend well beyond the irresponsibility of this administration. And they offer solutions that are clear,bold, and controversial. You may not accept them in full, but you will understand better than ever before the real choices that we face. This book is a must-read for a country adrift in fiscal shortsightedness and political spin.

Janet Yellen
The Coming Generational Storm documents in frightening detail America's reckless fiscal trajectory as it barrels toward bankruptcy. The need to revamp Medicare and Social Security is urgent. This book is a must-read for anyone who cares about our nation's future.

George Akerlof
I lie awake nights worrying about the fiscal crisis described in The Coming Generational Storm. This is by far the single most important problem in US economic policy. Every American should read this fabulous book.

Robert Whaples
The clarity of the analysis, the range, timeliness, and importance of the issues covered, and the authors' lively, provocative writing style make this book ideal for use in both introductory and higher-level classes.

From the Publisher
"Amos Tversky may have shown that basketball players do not have 'hot hands,' but he proved the opposite for psychologists. Tversky always made his basket, and in the process changed psychology, and also economics, forever."—George Akerlof, Koshland Professor of Economics, University of California, Berkeley, Nobel Laureate in Economic Sciences (2001)

"*The Coming Generational Storm* is one of the most important (and refreshingly irreverent) policy analyses of recent years. Laurence Kotlikoff and Scott Burns ask what will happen to our economy and way of life when the baby boomers meet the current Medicare and Social Security systems. Their answers, using the innovative techniques of 'generational accounting' developed by Kotlikoff and others, demonstrate how close we are to a genuine fiscal precipice and the hard landing that awaits us. For our current presidential aspirants, the authors also provide some provocative ideas for how to ameliorate the damage this storm will certainly leave in its wake."—Robert J. Shapiro, Managing Director and Founding Partner, Sonecon, LLC, Senior Fellow of the Brookings Institution and the Progressive Policy Institute, and former Under Secretary of Commerce for Economic AffairsPlease note: This is the final version of this quote — apologies for the many recirculations.

"I lie awake nights worrying about the fiscal crisis described in *The Coming Generational Storm*. This is by far the single most important problem in US economic policy. Every American should read this fabulous book."—George Akerlof,Koshland Professor of Economics, University of California, Berkeley, Nobel Laureate in Economic Sciences (2001)

"*The Coming Generational Storm* is a well written summary of an impressive and important body of carefully documented research. The book demonstrates clearly the folly of existing tax and transfer policies in the face of the impending retirement of the baby boom generation. Anyone interested in the future economic viability of American society and the economic problems we are bequeathing to our children should read this study."—James J. Heckman, Henry Schultz Distinguished Service Professor of Economics, The University of Chicago,Nobel Laureate in Economic Sciences (2000)

"*The Coming Generational Storm* documents in frightening detail America's reckless fiscal trajectory as it barrels toward bankruptcy. The need to revamp Medicare and Social Security is urgent. This book is a must-read for anyone who cares about our nation's future."—Janet Yellen, Haas School of Business,University of California, Berkeley, Member, Federal Reserve Board (1994-1997), and Chair, Council of Economic Advisers (1997-1999)

"As someone who has written extensively on global aging and its profound implications, I was delighted to read *The Coming Generational Storm*. It is an extremely important and original contribution."—Peter G. Peterson, Chairman, The Blackstone Group, and author of *Gray Dawn: How the Coming Age Wave Will Transform America—And The World*

"Kotlikoff and Burns document and analyze the most serious issue facing the American government today: the looming intergenerational conflict created by its gross failure to develop a consistent plan to fund and manage entitlements for the elderly, the cost of which will explode when the baby boom generation retires. This book is essential reading for those concerned about their own future and their childrens'."—Daniel McFadden, Cox Professor of Economics, University of California,Berkeley, Nobel Laureate in Economic Sciences (2000)

"Brilliant insights on the me generation vs.the next generation. Better still, smart advice on equally vexing questions like whether to invest in a 401(k) or a second mortgage."—Sylvia Nasar, John S. and James L. Knight Professor of Business Journalism, Columbia University, author of *A Beautiful Mind*

"The clarity of the analysis, the range, timeliness, and importance of the issues covered, and the authors' lively, provocative writing style make this book ideal for use in both introductory and higher-level classes."—Robert Whaples,Department of Economics, Wake Forest UniversityPlease note: Obtained for use in text promotion.

Daniel McFadden
Kotlikoff and Burns document and analyze the most serious issue facing the American government today: the looming intergenerational conflict created by its gross failure to develop a consistent plan to fund and manage entitlements for the elderly, the cost of which will explode when the baby boom generation retires. This book is essential reading for those concerned about their own future and their childrens'.

Meet the Author

Dallas Morning News personal finance columnist Scott Burns is nationally syndicated by Universal Press. His column can be read on the Web at www.scottburns.com and on MSN's MoneyCentral, one of the three largest financial Web sites.

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Coming Generational Storm: What You Need to Know about America's Economic Future 4.3 out of 5 based on 0 ratings. 4 reviews.
Anonymous More than 1 year ago
She nodded padding with th leader.
Anonymous More than 1 year ago
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Anonymous More than 1 year ago
Pads in.
Guest More than 1 year ago
One of the author's, Scott Burns, was the financial columnist for the Dallas Morning News. I had read his column for many years so his book is an expansion of many of his column themes. The book's message is that there are some very serious shortfalls that will be happening with the current political leadership. There is every possibility of medicare, part B and social security going kaput. My advice is take matters in your own hands as the author's suggest and create your own wealth.