America's Fiscal Choices At a Crossroad "Meet the Generations" Blog Series
CRFB has released a new paper called America's Fiscal Choices At a Crossroad: The Human Side of a Fiscal Crisis, which was released in conjunction with our event last week and the announcement of our fiscal video contest winners ("Voices of America").
Our Fiscal Futures Thought Experiment. In the paper, we conducted a thought experiment. In what is often called an "alternative futures exercise," we considered whether people would be better or worse off if our leaders chose one of two reasonably possible fiscal paths: The first path is "Fiscal Gridlock", in which politics as usual thwart attempts to enact fiscal reforms, eventually triggering a fiscal crisis as our country loses credibility in the bond markets and our government cannot service our debt at levels of interest rates we have enjoyed in the past. Even before we have a crisis, growth will be held back by debt-related pressures on interest rates, the closer we get to full employment. The second path ("A Fiscal Recovery Plan") involves enacting a multi-year plan to bring our deficits and debt into line so that the economy can achieve an even higher growth path in the future. Without the speed bumps and barriers from debt out of control, the adoption of a balanced fiscal plan (with everything on the table to spread the burden of adjustment) can mean higher living standards ahead.
Meet the Generations. To take a close look at how the lives of most Americans would be affected by our leaders' fiscal choices, we traced the impact of these choices on the life cycle of a typical member of each generation. By putting a human face on the deficit reduction debate, this paper is a call to action for our lawmakers to avert an entirely preventable catastrophe - and to lead Americans into a better future. Meet the generations we "profiled":
- The Baby Boomers: John is a 56 year old Boomer who didn't save enough and has elderly parents (who also didn't save enough) to support.
- Generation X: Among the most critical fiscal issues for our Generation X member Kate (age 41) are those affecting family and career.
- Millennials: Our 24-year-old Millennial, Nick, cannot find work he had expected in our struggling economy and has a lot of student loans to repay.
- Gen-Web (children): Keisha, our 6-year-old child of the Internet generation, is just starting school and has most of her life still ahead of her.
- Seniors: Edna is 75 years old, and relies on a fixed income from her savings and pension.
- We also took a close look at the implications of our two fiscal futures for special groups in society - the poor and working poor, plus business and innovators.
Over the course of the next week we will have a series of blogs taking a closer look at how our fiscal choices would affect the lives of John, Kate, Nick, Keisha and Edna. Be sure to stay tuned to The Bottom Line for updates in the coming days!