Kotlikoff on Fiscal Child Abuse and the Americans Elect Alternative
Those with an eye on the United States presidential race will know that the Republican Party primaries have been an embarrassment. Not only have they been riddled with errors and deliberate meddling, few people, including journalists, have understood who has had how many delegates.
All the while, the nation faces a disastrous fiscal situation, which few candidates are willing to address—Ron Paul being an exception. (It’s no wonder why so many people are leaving for yonder shores.) There is, however, an innovative alternative that merits attention.
I speak of Americans Elect, an initiative to get an independent candidate on the ballot in all 50 states, and it already has 2.5 million signatures towards making that happen. The beauty of this approach is that it has an open, online primary—so all Americans can participate with ease.
One candidate with Americans Elect, Larry Kotlikoff (pictured left), is an economist I’ve held in high regard for a long time. Even if I do not necessarily agree with his policy prescriptions, his analytical ability and his willingness to face politically inconvenient issues are unquestionable. Listen to that segment of the latest show below (17 minutes, MP3):
[audio:http://thestatelessman.com/wp-content/uploads/2012/03/Kotlikoff10Mar2012.mp3|titles=Larry Kotlikoff on TSM]
Kotlikoff first made an impression with me while I was a student at Boston University, where he still teaches. We used his text book in a macroeconomics class, but one of his books for wider distribution, The Coming Generational Storm (2005), motivated me to follow his work more closely.
It warned of the baby boomers retiring and the immense fiscal liability on the horizon. Well, the horizon is here, and little has changed, other than the severity of the situation. Unfunded liabilities of the federal government, the gap between their assets and liabilities, are now $211 trillion—far more than the reported debt of $15 trillion.
He describes the federal government as effectively bankrupt and the profligate spending as child abuse. To resolve the shortfall, he notes, every federal tax would immediately and permanently have to be raised by 64 percent, an unfathomable amount. And his disgust with impotence from the Democratic and Republican parties to address this problem has led him to put himself forward as an independent candidate for president of the United States.
We only touched upon the surface of his work and its implications, so I intend to have him on the show again in a few weeks. In the meantime, I encourage people to investigate his candidacy with the Americans Elect initiative. He also has a new book out this month, The Clash of Generations: Saving Ourselves, Our Kids, and Our Economy, which updates The Coming Generational Storm with the much worse scenario Americans now find themselves in.