Germany passes the buck – and the bill – to the youth

9 04 2012

It’s no secret that Europe is in quite a bind. Not even the industrious, stalwart Germany has been able to avoid the squeeze of an economic slowdown, unfavorable demographics, and unsustainable promises made its citizens. The bill for several generations of government-provided goodies is about to come due, and – to put it bluntly – there simply aren’t enough young people around to pick up the tab.

Your economic opportunities or your life, kid

Germany’s solution to this impending problem? Slap a tax on the youth. According to a Telegraph article on the tax:

A slump in Germany’s population means that as more and more ageing Germans retire there are less and less young workers to replace them as taxpayers to fund generous welfare and pension arrangements.

Estimates from Germany’s federal employment agency, predict that the workforce will be reduced by seven million people by 2025.

“We have to consider the time after 2030 when the baby boomers of the 50s and 60s are retired and costing us more in health and care costs,” said Guenter Krings, who drafted the Christian Democrat “position paper”.

Indeed, “we” have to consider the consequences of past promises built on Ponzi scheme-like assumptions. Young Germans should be raising hell about this development; they had no say in creating the rapidly crumbling welfare system they are set to inherit – and are increasingly expected to foot the bill for.

As much as we’d like to think otherwise, it’s really no different here. While demographics might seem to paint a slightly sunnier picture for America than they do for Germany and other European nations, our profligate politicos are dragging us down a debt-financed road to welfare statism even as European leaders struggle to scale back their unrealistic promises.

Proponents of Germany’s youth surtax will likely claim that governments cannot renege on its promises to those who “paid into the system.” This same argument is used to quash even moderate attempts to reform America’s entitlement programs; scare tactics virtually ensure that the issue is kicked another election cycle down the road, year after year. Recall the specter of cat food-eating seniors. Remember the commercial featuring a Paul Ryan-lookalike pushing granny over a cliff.

After a certain point, however, we need to be honest with ourselves. We’ve been sold a bill of goods by politicians who knew they’d be dead before the checks started to bounce. If any private businessman got caught using the accounting standards that allow us to pretend that Social Security is adequately funded, he’d be arrested for cooking the books. Unless we start making radical changes to our system – now – it is going to implode.

The alternative is to follow Germany’s lead and pretend that a reprehensible youth surtax can patch up a systemically flawed welfare model. That surtax can succeed at only one thing: sparking a bitter, cross-generational resentment that will make “class warfare” look as peaked as an Occupy protest. And it will all be done in order to maintain the unsustainable illusion of state-provided prosperity for a few more years.

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