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As Baby Boomers Head For Retirement, Does Demographic Disaster Mean The Good Times Are “Really Over For Good?"
When the April figures on unemployment were released May 4, they were more than disappointing. They were deeply disturbing.
While the unemployment rate had fallen from 8.2 percent to 8.1 percent, 342,000 workers had stopped looking for work. They had just dropped out of the labor market.
Only 63.6 percent of the U.S. working age population is now in the labor force, the lowest level since December 1981.
During the Reagan, Bush I and Clinton years, participation in the labor force rose steadily to a record 67 percent. The plunge since has been almost uninterrupted.
Here is a major cause of the economic malaise of the 21st century, a condition over which a president has little control. A shrinking share of our population is carrying an ever-expanding army of dependents.
If this were a result of American women going home to have kids, that would be, as it was after World War II, a manifestation of national vigor and health.
But that is not the case here.
The number of Americans of working age not in the labor force grew in April from 87,897,000 to 88,419,000—by an astonishing 522,000. This is an immense army for the rest of society to carry.
Why are Americans dropping out?
Some have given up looking for jobs in towns they grew up in, because the jobs are gone and not coming back, and they don't want to leave. Some are rejecting the low-wage unskilled work being offered, because the alternative—unemployment checks and federal and state welfare—is not all that torturous.
With some, the work incentive was never implanted. With others, the option of moving back in with the parents is not all that terrible.
America, it seems, is becoming less like the country we grew up in, in its attitudes about work and idleness, and more like Europe.
And yet another ominous cloud, no longer on the far horizon, is now directly above: the impending departure from the labor force of 70 million baby boomers in the next two decades.
According to the Statistical Abstract of the United States, from Jan. 1, 1930, to Dec. 31, 1935, there were 13 million births in the U.S. From January 1940 through December 1945, there were 16 million.
This was the Silent Generation, born in Depression and war. It never produced a president, and never will, unless Ron Paul catches fire pretty quickly. The Greatest Generation gave us six presidents, starting with JFK and ending with Bush I. Our three most recent presidents—Bill Clinton, Bush II, Barack Obama—are all baby boomers
And here we come to the heart of our next economic crisis.
If one adds up all the children born between Jan. 1, 1946 and Jan. 1, 1965, the era of the great American baby boom, the total comes to 77 million babies born in the United States.
Why is this so significant now?
Because this year, 2012, the first wave of baby boomers, all those born in 1946, like Clinton and George W. Bush, will reach 66, and eligibility for full Social Security and Medicare benefits. The boomers, en masse, will start moving off payrolls onto pension rolls.
Let us assume the 77 million boomers are down to 72 million. This means that over the next 20 years, boomers will be retiring and reaching eligibility for Social Security and Medicare at a rate of 3.6 million a year, or 300,000 a month, or 10,000 every day.
Three hundred thousand a month leaving the labor force may help to explain its shrinkage. And as the boomers are the best-paid, best-educated generation we produced, the loss of their collective skills, abilities and tax contributions will be as heavy a blow to the nation as the funding of their Medicare and Social Security will be a burden to the taxpayers they leave behind in the labor force.
Since Roe v. Wade, abortions have carried off 53 million of the generations that were to replace the boomers. While those 53 million lost have been partially replaced by 40 million immigrants, legal and illegal, our recent immigrants have not exhibited the same income- or tax-producing capacity as boomers.
In 1965, LBJ announced his plan to convert our ordinary society into a Great Society. Since then, trillions have been spent.
The fruits of that immense investment? The illegitimacy rate, dropout rate, crime rate and incarceration rate have set new records, as the test scores of high school students have plummeted to new lows.
Our labor force is shrinking, the number of dependent U.S. adults is growing, our social programs are failing, and our best educated and most productive generation is retiring.
To borrow from Merle Haggard, "Are the good times really over for good?"
Patrick J. Buchanan needs no introduction to VDARE.COM readers; his book State of Emergency: The Third World Invasion and Conquest of America, can be ordered from Amazon.com. His most recent published book is Churchill, Hitler, and "The Unnecessary War": How Britain Lost Its Empire and the West Lost the World, reviewed here by Paul Craig Roberts. His new book Suicide of a Superpower: Will America Survive to 2025? was released October 18, 2011.