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Bill Roth headshot

The Coming Boomer Generation Bailout Crisis

By Bill Roth

Think the Wall Street bailout was painful? Soon that may seem like the good old days as America pays for the boomer generation's retirement and poor health.

The baby boomer generation is so large that it has shaped the American economy since their births between between 1946 and 1964. Their current size approximates the combined populations of California, Texas and Florida. Now image the populations of all three states having no money and poor health. That is the crisis about to hit the boomer generation and America.

The boomer generation’s financial crisis

The vast majority of the boomer generation has failed to adequately save for retirement. The average baby boomer has saved $136,000. But averages can be highly deceiving. In fact, 25 percent of the boomer generation has zero money saved for retirement. And less than half have saved $50,000 or more.

That equates to 37 million Americans having zero or little savings. Texas has 30 million citizens. So the coming boomer generation crisis will be similar to everyone living in Texas declaring bankruptcy because they have no savings, their medical costs are soaring and their health issues preclude them from working.

The boomer generation cannot afford its weight

The boomer generation is in a weight crisis. Seventy-five percent of boomer generation women and 80 percent of boomer generation men are either overweight or obese. Their historical diet and lifestyle choices are now endangering their health and is driving government healthcare expenditures to record levels.

Medicare is the federal health insurance program for citizens 65 years of age or older. Fifteen percent of the U.S. budget is spent on Medicare because the premiums paid by those on Medicare do not cover the full cost of its health services.

Two huge funding issues confront Medicare. One is that the Affordable Care Act, also known as Obamacare, actually reduced Medicare costs. If Republicans repeal Obamacare, then Medicare costs go up. The options if this happens are to:

  • Ask the generation that has not saved for its health care to pay more

  • Provide less medical coverage leading to sooner and more painful end of life

  • Increase government payments to Medicare.

A massive increase in Medicare spending is the second issue. Medicare expenditures are projected to reach more than $1 trillion annually in 10 years. That is almost double current expenditure levels.

The bottom line for all politicians -- and our country -- is that the boomer generation cannot afford its health care without massive government support. The alternative is to subject the boomer generation to painfully shortened lifespans.

Four actions that address the boomer generation crisis

There are sustainable solutions if, as a nation, we can overcome healthcare industry lobbying and ideological posturing over individual rights. They are:

1. A Manhattan Project type effort to cut medical costs: The Manhattan Project brought together America’s greatest engineers and physicists to design a nuclear bomb. We need a similar effort to achieve affordable health care.

This effort would push aside health industry lobbying and engage America's business and technology best and brightest. They would be charged with designing business systems and implementing technology solutions that pushed down costs while enhancing the quality of healthcare. Like Amazon is doing to Sears, this will probably wipe out much of today’s inefficient health care business practices and companies. The result will be affordable, quality health care.

2. Tax unhealthy foods like we do cigarettes: We can no longer afford the health consequences of what we eat! For example, sugary drinks, and the sugar that permeates most of our manufactured food, is destroying our health. Our food system needs to be redesigned to deliver health.

This, of course, smacks into the individual right to eat and drink whatever we want. The proven economic solution is to charge more for behavior that inflicts self harm or high societal costs. For example, higher cigarette taxes have cut smoking rates with measurable reductions in cancer incidents. Similar public policy applied to unhealthy foods will mitigate our nation’s healthcare costs and reduce human suffering.

3. End workplace age discrimination: Most members of the boomer generation can cite specific examples of workplace age discrimination. This is a barrier to extending their working lives. Enforcing age discrimination laws will increase the amount of money the boomer generation can spend on Medicare payments.

4. Technology training for boomer generation workers: This generation’s employment can be extended with government-funded job training on work place technology. Doing so is a lower cost alternative to providing them with government substance funding.

Affording the boomer generation

America has never been here before. We cannot afford our largest demographic group.

The alternatives are crystal clear. We can keep the failed systems we now have in place and tax/borrow funds to financially bailout the boomer generation. Or we can develop solutions that deliver:

  1. affordable/quality health care

  2. improved individual health through a national adoption of a healthy food system

  3. an extended boomer generation work horizon through enforcement of age discrimination laws while also funding work place technology training.
Image credit: Pixabay
Bill Roth headshot

Bill Roth is a cleantech business pioneer having led teams that developed the first hydrogen fueled Prius and a utility scale, non-thermal solar power plant. Using his CEO and senior officer experiences, Roth has coached hundreds of CEOs and business owners on how to develop and implement projects that win customers and cut costs while reducing environmental impacts. As a professional economist, Roth has written numerous books including his best selling The Secret Green Sauce (available on Amazon) that profiles proven sustainable best practices in pricing, marketing and operations. His most recent book, The Boomer Generation Diet (available on Amazon) profiles his humorous personal story on how he used sustainable best practices to lose 40 pounds and still enjoy Happy Hour!

Read more stories by Bill Roth