Wednesday, June 11, 2014

Jack Lew Seems Irritated by Baby Boomers

By Robert Wenzel

Treasury Secretary Jack Lew spoke this morning before the New York Economic Club. In a very boring speech (We listen to it, so you don't have to), one subtle theme stuck out, Baby Boomers are a problem for the government.

At one point, Lew said:
[W]e have all known for decades that Social Security, Medicare, and Medicaid face long-term challenges stemming from an aging population and the cost of health care.  And we will need to address these challenges to make sure the promises at the core of these programs remain ironclad.
And at another point he said:
 Of course, we cannot repeal the Baby Boom, but we can address the resulting decline in the labor force...
He didn't directly come out and say that Baby Boomers are a big annoyance to government now that they are  leaving the tax paying force and starting to be a drain on government coffers, but that seems to be what he is thinking.  Only a government official would even conjure up in his mind the theoretical possibility of repealing the Baby Boom.

Of course, what needs to be repealed are government interventions in the economy, such as social security and Medicare, which the government has run as a kind of Bernie Madoff on steroids operation. Retirement plans should be left to the private sector. It would result in creativity, options and diverse investment programs, not one gigantic government operation, run as a scam, that will never fulfill its promises and annoy government operators in charge of actually making the payouts.

Robert Wenzel is Editor & Publisher of and author of The Fed Flunks: My Speech at the New York Federal Reserve Bank.


  1. Government's "ironclad promise" involves stealing from today's generation to pay for the last one. In other words, a compulsory Ponzi scheme.

    With all due respect to Mr. Lew and his fellow busy-bodies, I'm an adult. I can plan and save for my own retirement, thank you very much. I'll be a lot more responsible and successful than they ever will be.

  2. Robert Johnson w/ Paul Jay
    "When I was a young person, say, in my late '20s or early '30s, going to closed-door caucuses with congressmen and senators about the structure of impending financial legislation reminds me of Bismark's comment that no one should ever see sausage or legislation made. It is an interesting thing from my vantage point, which is many people on the left doubt what you might call the validity of free markets, and they recommend intervention and regulation. For someone who's seen how the regulatory response is designed and enforced, I'm not as sanguine about the powers of regulation...

    "My sense at the time was that I was getting educated, not cynical. But I did say at one point to a reporter when I left and went to New York that I felt that I had observed a lobbyist could undo in one lunch six months of my work. And so in that respect the limitations of the power of legislative staff were evident to me. But in those days (we're now talking about late '80s), I still felt, say, like the lead attorneys at the Federal Reserve and others were primarily the draftsmen of legislation. By the time you get to 2008 and beyond, Dodd-Frank legislation, much of this legislation is drafted by lobbyists and they're--how you say--they're growing their own rules and they're holding fundraisers out the wazoo."

    On Reality Asserts Itself, Mr. Johnson says the scale of the political investment of finance - six, seven hundred million dollars - is overwhelming. With the political power of finance, do we still have a democracy? - June 10, 14

  3. What needs to be repealed is usury. That's the root of much of this evil and gives the Money Powers their leverage.

    1. The vanished grandeur of accounting Once, bookkeepers were valorized in great art. Sound funny now? The joke might be on us.

      This was not simply a wealthy nation crowing about its financial success. The Dutch were the leading merchants of their time, and they saw good accounting as the key to both their wealth and the moral health of their society. To the audience of the time, the paintings carried a clear message: Mastering finance was an achievement requiring both skill and humility.

      Today when we see accountants in art or entertainment, they are marginal figures—comically boring bean-counters or fraudsters cooking the books. Accounting is almost a synonym for drudgery: from the hapless daydreamer Walter Mitty to the iconic nerd accountant Rick Moranis plays in “Ghostbusters.” Accounting is seen as less a moral calling than a fussy brake on the action.

      In the wake of decades of financial scandal—much of it linked to creative accounting, or to no accounting all—the Dutch tradition of accounting art suggests it might be us, not the Dutch, who have misjudged accounting’s importance in the world. Accounting in the modern sense was still a new idea in the 1500s, one with a weight that carried beyond the business world. A proper accounting invoked the idea of debts paid, the obligation of nightly personal reckonings, and even calling to account the wealthy and powerful through audits.

      It was an idea powerful enough to occupy the attention of thinkers in religion, art, and philosophy. A look back at the tradition of accounting in art shows just how much is at stake in “good accounting,” and how much society can gain from seeing it, like the Dutch, not just as a tool but as a cultural principle and a moral position.

      It would come to change finance, but was not an immediate hit. Any system of enforcing fiscal discipline is an incursion against the absolute control of the account-holder, and kings and the powerful tended to see themselves above the merchant-like calculations of bookkeeping. They not only hid their wealth and debts: They often did not bother to calculate them. In the end, they saw themselves as only accountable to God; if they needed more ready cash, they could always lean on their inferiors. At least in the short run, it was far more comfortable to govern without the constraints of financial accountability.

  4. Jack Lew can sleep easy at night. The ACA has taken care of the Baby Boomer problem. The death panel (sorry, the "Independent Payment Advisory Board") will ensure the monetary costs don't get too high. The cost in human lives...? Well, that'll just be blamed on Tea Party Republicans who always want to cut the budget.

    Yes, yes, before you liberal posters get too worked up, I admitted my mistake above: The ACA bill does not call for anything called a "death panel". It calls for what amounts to the same thing but specifies a euphemistic name for it.