Government is shortchanging young people on everything from education and healthcare to employment and retirement, according to Manhattan Institute senior fellow Diana Furchtgott-Roth and policy analyst Jared Meyer, co-authors of the forthcoming book Disinherited: How Washington Is Betraying America’s Young.
“This betrayal is not intentional,” they begin. “In this book we lay out the scope of the problem and what will be necessary to solve it. Plainly stated, Washington is robbing America’s young. Our country is facing a crisis, and change is essential in order for young people to achieve the future they deserve.”
In retirement, Millennials will be at a dismal financial crossroads, relative to their parents and grandparents, according to the author pair.
“They can either pay substantially higher taxes than their parents do, while not receiving any more benefits, or they can pay the same rate as their elders and receive far fewer benefits,” the write. “Both outcomes are grossly unfair … If trends continue, workers could be paying a combined employer-employee payroll tax rate of 32 percent in 2050 just to cover Medicare and Social Security payments.”
The book also examines state pension and healthcare expenditures, which are massively underfunded in many states (in part due to unrealistic investment return assumptions and various accounting sleights of hand), leading the authors to wonder whether the bankruptcy of a state would require a federal bailout from future taxpayers, e.g. today’s young.
On education, Furchtgott-Roth and Meyer give evidence of the effectiveness of charter schools in states ranging from New York to Arizona and Louisiana, where the Obama administration’s Department of Justice (DOJ) sued to block school vouchers in the name of fighting desegregation. However, the pair points out, “Desegregation expert Christine Rossell looked at Louisiana’s voucher program and found that in most districts, voucher programs actually reduced racial imbalance. The DOJ has since withdrawn the suit, but the fact that it was filed at all on such spurious grounds underscores the extreme hostility of the federal government to state initiative to improve education.”
Disinherited takes a harsh stance against secondary school administrators who push students into four-year college degree programs, eventually leading them to be saddled with an average of $25,000 in debt that cannot be discharged in bankruptcy. Yet many of these degrees have little value in the marketplace, with the New York Federal Reserve estimating 44 percent of recent graduates work in jobs that do not require a bachelor’s degree. And Wells Fargo found that one-fourth of millennials do not think college was worth the cost.
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