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There's a kernel of truth in your argument. At least some of the effect is changing perception. But some is changing realities as well. My investment advisor t

There's a kernel of truth in your argument. At least some of the effect is changing perception. But some is changing realities as well. My investment advisor tells me that with the GWB tax cuts expiring, scheduled increases in capital gains taxes, and the government's refusal to address the AMT problem, that my tax situation is changing drastically enough that I need to change my investment strategy. I'm paying into Social Security to give my grandparents more money than they ever paid in, and covering the shortfall created by my parents' generation running up huge deficits and borrowing the money from SS. On the other side, you're asking me to help out the younger generation pay their tax bills. And stuck in the middle, I find that any responsible behavior on my part is answered by looting the savings from my frugality to give to reward the profligate. I'm paying down my mortgage as fast as I can, while underwriting the costs for those who bought McMansions and can't afford them. Those of us who bought economical cars are paying part of the costs for fuel hogs to trade in for better mileage. I'm quite certain that after all the savings I've done for old age, the long term care insurance I've paid 5-digits into, etc., the government is going to see that I have too many privileges (that I've worked for, and lived frugally to amass) and take away more of what I've had to give to the wasteful. Every day I see another version of the ant-and-grasshopper story. I don't think you can blame me for frustration. And you really ought to worry about the moral hazard it's causing. I fear that it leads to a feedback cycle, where the problem gets worse and worse.

Quarrelsome 17y ago
I'm not asking you to pay their tax bills. I'm asking you not to leave the younger generation in the lurch. All over the world the baby boomers are stumbling into retirement. In a lot of countries this poses a serious problem as this: * represents a significant voting block * makes large demands on healthcare * makes large demands on pensions And this is on top of the huge deficits that most western countries currently have. I envisage the new generation having to pay for a lot of the costs of the baby boomers while also representing a smaller voting block. This is made even worse in countries with less land (Japan and most of Western Europe) as this generation is already struggling to get onto the property ladder. These being the people that don't have enough money to afford an "investment advisor". What makes this state of affairs even worse is that the older generation who did well are starting to move abroad thereby denying the country of their tax. Of those that remain a significant proportion are anti-immigration. This leads me wonder how the pyramid schemes that are pensions and healthcare are actually going to be affordable when the pyramid becomes inverted and the voting block are anti-immigration.
- CWuestefeld 17y ago
  While you recognize that so much of this is a pyramid scheme, it seems to me that you're saying I've got to keep paying just so that the pyramid can keep going. Is there ever a point where it's OK to say "this is wrong, we must stop"? You're also assuming an extremely high degree of responsibility for neighbors. Now, I'm not going to go religiously Ayn Rand on you. I acknowledge that society is interdependent, and I couldn't have achieved as much as I have without neighbors that work together. But I think you're going too far. There are things I'd like to do in my life, and for those that are most important, I'm consciously laying things out in a way that should allow me to get there. This isn't without some pain. There are plenty of things lower on my priority list that I must forgo in order to get to the high-priority ones. I don't have an iPhone, I don't have an LCD TV, let alone HD. My wife and I each have a car: mine is 8 years old with 108,000 miles; hers is 7 with 130,000 miles. We rarely eat out. We don't have fancy furniture: much of it is from WalMart, as is much of my clothing. We use credit cards for convenience, and have never run a balance on them. This is not an extravagant lifestyle, this is thrift. Yet I see every day people living extravagantly: leasing cars and turning them over every 2-3 years; huge houses, refinanced at 45 years old so they'll be paying until they're 75; cigarettes and expensive drinks; $900 purses and fancy shoes. The result is that I have more assets. Yet I constantly hear complaints about how unfair it is that people have more in the bank, and those "lucky" few should have to shoulder the burdens that frequently result from the profligacy of the indebted. So I make myself suffer to save. And it seems that I'm to be made to suffer later, too, as my savings are looted. But on the other side of the screen, those living high on the hog will, by virtue of their very wastefulness, get a claim on proceeds of my frugality, allowing them to continue their party. How do you expect me to feel that I owe this to them? You say that I should help the younger generation by helping them shoulder some of the tax burden. But isn't paying the debts of the grasshopper creating moral hazard, doing harm to the younger generation by showing them that the path to happiness is finding an ant to carry them along?
  - Quarrelsome 17y ago
    Yes it is a pyramid scheme. Yes we can stop it and yes that would cause people to die (earlier) and/or suffer. Personally i'm not willing to make that choice. I apologise that you've taken this personally, I just wished to point out that the tax burden does appear to fall on the younger generation. Especially if the older ones are shipping out due to "tax reasons". Please appreciate that i'm from the UK so my perspective in regards to the welfare state is a favourable one since it was built on the wishes of those that took part in WW2, a brighter tomorrow if you will.... I also find it unfortunate that you decide to debate this around those who are wasteful. There are many people who have had crap, unfortunate lives that require our help. A balanced discussion of any welfare state requires us to acknowledge all of these types of people, both the wasteful and the needy. Would you rather ignore the needy at the benefit of giving the wasteful what they deserve (nothing)?

Quarrelsome 17y ago

I'm not asking you to pay their tax bills. I'm asking you not to leave the younger generation in the lurch. All over the world the baby boomers are stumbling into retirement. In a lot of countries this poses a serious problem as this: * represents a significant voting block * makes large demands on healthcare * makes large demands on pensions And this is on top of the huge deficits that most western countries currently have. I envisage the new generation having to pay for a lot of the costs of the baby boomers while also representing a smaller voting block. This is made even worse in countries with less land (Japan and most of Western Europe) as this generation is already struggling to get onto the property ladder. These being the people that don't have enough money to afford an "investment advisor". What makes this state of affairs even worse is that the older generation who did well are starting to move abroad thereby denying the country of their tax. Of those that remain a significant proportion are anti-immigration. This leads me wonder how the pyramid schemes that are pensions and healthcare are actually going to be affordable when the pyramid becomes inverted and the voting block are anti-immigration.

CWuestefeld 17y ago
While you recognize that so much of this is a pyramid scheme, it seems to me that you're saying I've got to keep paying just so that the pyramid can keep going. Is there ever a point where it's OK to say "this is wrong, we must stop"? You're also assuming an extremely high degree of responsibility for neighbors. Now, I'm not going to go religiously Ayn Rand on you. I acknowledge that society is interdependent, and I couldn't have achieved as much as I have without neighbors that work together. But I think you're going too far. There are things I'd like to do in my life, and for those that are most important, I'm consciously laying things out in a way that should allow me to get there. This isn't without some pain. There are plenty of things lower on my priority list that I must forgo in order to get to the high-priority ones. I don't have an iPhone, I don't have an LCD TV, let alone HD. My wife and I each have a car: mine is 8 years old with 108,000 miles; hers is 7 with 130,000 miles. We rarely eat out. We don't have fancy furniture: much of it is from WalMart, as is much of my clothing. We use credit cards for convenience, and have never run a balance on them. This is not an extravagant lifestyle, this is thrift. Yet I see every day people living extravagantly: leasing cars and turning them over every 2-3 years; huge houses, refinanced at 45 years old so they'll be paying until they're 75; cigarettes and expensive drinks; $900 purses and fancy shoes. The result is that I have more assets. Yet I constantly hear complaints about how unfair it is that people have more in the bank, and those "lucky" few should have to shoulder the burdens that frequently result from the profligacy of the indebted. So I make myself suffer to save. And it seems that I'm to be made to suffer later, too, as my savings are looted. But on the other side of the screen, those living high on the hog will, by virtue of their very wastefulness, get a claim on proceeds of my frugality, allowing them to continue their party. How do you expect me to feel that I owe this to them? You say that I should help the younger generation by helping them shoulder some of the tax burden. But isn't paying the debts of the grasshopper creating moral hazard, doing harm to the younger generation by showing them that the path to happiness is finding an ant to carry them along?
- Quarrelsome 17y ago
  Yes it is a pyramid scheme. Yes we can stop it and yes that would cause people to die (earlier) and/or suffer. Personally i'm not willing to make that choice. I apologise that you've taken this personally, I just wished to point out that the tax burden does appear to fall on the younger generation. Especially if the older ones are shipping out due to "tax reasons". Please appreciate that i'm from the UK so my perspective in regards to the welfare state is a favourable one since it was built on the wishes of those that took part in WW2, a brighter tomorrow if you will.... I also find it unfortunate that you decide to debate this around those who are wasteful. There are many people who have had crap, unfortunate lives that require our help. A balanced discussion of any welfare state requires us to acknowledge all of these types of people, both the wasteful and the needy. Would you rather ignore the needy at the benefit of giving the wasteful what they deserve (nothing)?