This post distills the argument in my thesis down to a few hundred words. The thesis contains a fairly long discussion of previous theoretical and empirical work on the issue of intergenerational transfer and then performs some new quantitive work to justify some of these arguments. If you want to read more, let me know. But I’lll distill the arguments out here.
The federal government makes decisions all the time that impact the lives of young and unborn people. When it runs large budget deficits to fund present consumption rather than investment, it imposes higher taxes on future generations to pay them off. When it ignores problems like climate change, it imposes the costs of climate instability not on today’s voters (most of whom will be dead by 2050 or so) but on today’s young people and they’re children who face the worst of the problem.
Though profoundly impacted by today’s federal policy, these young and unborn persons have no say in the decision-making process that selects them. They must rely on their elders to make unselfish decisions for their benefit. So far, they’ve been sorely disappointed. Budget deficits have skyrocketed both on an annual basis and in terms of aggregate debt-to-gdp ratio. Even the rosiest of budget projections don’t show them returning to reasonable rates for some time.
Medicare, Medicaid, and Social Security will be insolvent in the next several decades, but no politician will touch them. As Tip O’Neil put it, they are the “third-rail of American politics.” Cap-and-trade legislation to tax carbon emissions and curtail climate change couldn’t pass the senate even with 59 Democrats in it. Similar legislation would be dead on arrival today.
This selfishness shouldn’t surprise anyone. Most voting models are based on a “rational choice” assumption that people vote for policies and candidates that serve their own interests. For most of today’s electorate, raising taxes or cutting consumption today for the benefit of future generations isn’t a self-interested policy choice. Those who would support a more forward looking approach to these inter-generational issues are mostly too young to vote or not yet alive at all.
As a matter of policy, it’s tough to figure out how to represent these people’s interests. We can’t give ten-year-olds voting rights. At best, they would vote for their parents’ candidate; at worst, they’d pick something completely nuts like The Rent is Too Damn High Party. Unborn persons are even trickier. I’ve got a whole bunch of slightly crazy ideas for how to do this, but I’m pretty sure that none of them would be politically feasible or palatable to the general public.
Look for some of those in part 2 of this post.