Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, December 28, 1994 TAG: 9412280084
SECTION: NATIONAL/INTERNATIONAL PAGE: A1 EDITION: METRO
SOURCE: DENNIS ROMERO LOS ANGELES TIMES
DATELINE: LENGTH: Long
Politically minded Generation Xers have teamed up with older fiscal conservatives and even concerned Baby Boomers to promote a '90s version of the welfare mom: the golf-cart granny.
Picture if you will a 70-something living it up in Palm Beach, Fla., cruisin' the greens under the canopy of a golf cart, collecting dividends on stocks and interest on bonds and, oh yes, plenty of Social Security, too. That's the image being fed to the media by some young leaders and like-minded politicos.
This is the symbol, they say, behind a new generation gap that is as wide as the 36-plus years that separate GI Generation grandmother from Xer grandson.
``Today's young are being asked to bear the burden for their grandparents' spending,'' says Richard Thau, director of a New York-based Xer political group called Third Millennium.
``The last thing we want is a generational war,'' says Thau, 29. ``But in order to avoid one, we have to take steps now.''
The issue of the GI Generation (born roughly 1901-24) possibly leaving debts for Xers (born from about 1961-81) has awakened political youth groups in the last year or so. Some call it a ``generational transfer of wealth.'' The gripe is that federal ``entitlements,'' a majority of which go to retirees, are eating up federal spending. Entitlements include Social Security, medical care for retirees and disability insurance for workers.
``A kid flipping burgers at five bucks an hour still pays the Social Security benefits of a retired couple living in Florida with a cash income of $50,000 a year and a paid-off mortgage,'' write Rob Nelson and Jon Cowan in their new book, ``Revolution X: A Survival Guide for Our Generation.'' In part, the book targets Social Security as a looming problem for Generation X.
Last year, the authors led a demonstration in front of the Washington, D.C., headquarters of the American Association for Retired Persons. The Xer political group they founded, Lead or Leave, was protesting AARP's support for entitlement spending.
In August, Nelson and Cowan wrote an opinion piece in the Los Angeles Times decrying the lack of under-40 membership on the federal Bipartisan Commission on Entitlement and Tax Reform. They called commission members ``entitlement war horses.''
And this fall, Third Millennium released the results of a survey that found more Xers believe in UFOs than believe Social Security will be around when they retire. The survey also said that a plurality of Xers - 42 percent - believe the AARP ``does not care about treading on future generations.''
Xers find allies in groups like Washington's Concord Coalition - a political organization dominated by fiscally conservative Silent Generation types (born from about 1925-42) - and the Dallas-area American Association of Boomers (for those born roughly 1943-60). Even some GI Generation members are joining in.
``With all the talk of welfare cheats, it's nothing compared to entitlements,'' says 76-year-old Lawrence A. Benenson, a retired businessman who contributes money to Third Millennium. ``Those in my generation are the real welfare cheats.''
Even politicians, like incoming House Speaker Newt Gingrich, R-Ga., are bringing up the prospect of trimming Social Security. The federal Bipartisan Commission on Entitlement and Tax Reform was set to recommend slashing Social Security, but backed off this month. Sen. Bob Kerrey, D-Neb., chairman of the committee, said cuts were not ``a realistic hope'' politically.
The 33-million member AARP has fought back with an offering of ``intergenerational'' cooperation, a willingness to support ``modest adjustments'' in Social Security and a rejection of the golf-cart granny image.
``Nearly 75 percent of Social Security and Medicare benefits go to households with incomes other than Social Security under $20,000 a year,'' states an opinion piece in the AARP's Modern Maturity magazine, although those numbers are disputed by some economists.
Social Security was set up in 1935 as a trust fund. Now, people are living longer, the number of workers per retiree has fallen to almost 3-to-1 (from 55-to-1 in 1935), and the government has increased payoffs. Nowadays, retirees generally get more out of Social Security than they put in.
A GI Generation worker who retired in 1980 got back his contributions in less than three years. ``Social Security paid off nicely for the generation that set it up,'' Federal Reserve official Lawrence Lindsey argued in a recent issue of Forbes.
Government officials say they have enough money to meet Social Security's commitments until 2036. But the federal government is borrowing from that trust fund for today's budgets - and issuing IOUs for tomorrow. Eventually, more taxes or cuts in services will have to pay for those IOUs.
AARP officials say paying off the IOUs is not their problem.
``That's a problem of balancing the budget,'' says legislative director John Rother, 47.
In fact, argues Rother, Social Security is one of few things in the federal government that does work.
by CNB