April 2, 2012

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The Old People are coming – and they won’t stop until they take up an increasingly large portion of America’s economic resources.

In “The War Against Youth,” a new piece for Esquire, Stephen Marche makes the case that the American economy offers “unaffordable Greek-style socialism for the old, virulently purified capitalism for the young.” The War versus The Olds has a zero-sum logic:

The federal government spends $480 billion on Medicare and $68 billion on education. Prescription drugs: $62 billion. Head Start: $8 billion. Across the board, the money flows not to helping the young grow up, but helping the old die comfortably.

Marche calls this “the predictable outcome of thirty years of economic and social policy that has been rigged to serve the comfort and largesse of the old at the expense of the young.” Judging by voter turnout, you could also call this democracy.

It’s true that young people’s prospects are disturbingly bleak. But youth is cheap, while heart transplants are expensive. And as Dean Baker explains, a lot of the substance of Marche’s article is simply false.

The Boomers-as-resource-sucking-vampires argument would be a lot more persuasive if there were great evidence of the “comfort and largesse” Marche says older Americans enjoy. Americans 65 and over suffer from the longest of long-term unemployment, older Americans still owe some $36 billion in student loans and pension funds are simultaneously becoming riskier while delivering lower returns.

Which is to say, ignore the warnings of a scourge of aging Boomers stealing away the hard-earned fruits of your youthful and vigorous labor. This isn’t the Hunger Games.

And on today’s links.

Congress just made it easier for startups to conceal accounting regularities from the public – WSJ

The entire global financial in one single, infinite run-on sentence – Housing Story
Americans 60 and older still owe $36 billion in student loans – WashPost

Your pension fund is now riskier, with lower returns – NYT

EU Mess
EU banks searching for novel ways to kick the can – including lending to bullfighting fans – WSJ

…earlier this year, a Seville bullfight company, Empresa Pagés, struck an unorthodox deal with its lender, Banca Civica, soon to be part of national giant Caixabank SA. The bank agreed to lend money to cash-strapped bullfight fans to help them buy season tickets, which cost several hundred euros apiece. Empresa Pagés gets the ticket revenue upfront. The fans generally need to repay the loans, with interest, within a year.

Related: Euro zone PMI tanks, unemployment hits 14-year high – FT Alphaville
Holders of Greek debt are still fighting a bond swap – WSJ

Rational Markets
We challenge you to make sense of these bizarre emergency room charges – LAT

Debbie Cassettari had outpatient foot surgery to remove a bone spur. She arrived at the surgery center at 8 a.m., left at 12:30 p.m., and the bill came to $37,000, not counting doctor fees. In recovery now from sticker shock, she’s waiting for her insurance company to do the tango with the clinic and figure out who owes what to whom.

Crisis Retro
AIG wants back in to the mortgage market – FT

The crisis-era $1.3 billion bond deal that’s haunting Goldman – Fortune
Goldman sells investment in company that owns a sex-trafficking site – Reuters

Dan Loeb creates an entire website dedicated to bashing Yahoo’s leadership – Value Yahoo

Ashton Kutcher to play Steve Jobs – Variety

Alternative Currencies
Traders are maybe, possibly buying Bitcons – Reuters

Big Brother Inc.
How playground casinos get you to gamble more – Wired

Old Timey
Charles Merrill wanted brokers to be called “service representatives” – Bloomberg

Don’t. Ever. Bet. Against. Bernanke – Market Montage
The most valuable committees in Congress – NPR

Reuters Opinion
The recession killed journalism – and saved it – Paul Smalera
The euro zone should beware the “F” word – Hugo Dixon
Politicians placing bets – David Cay Johnston
Manufacturing redux – Chrystia Freeland
The hope and beauty of an Iran stalemate – Ian Bremmer

Kickstart a meta-analysis of the question: Does aid work? – Kickstarter

Fourteen lawmakers voted against every single budget plan that was under consideration last week – The Hill

Judge says he never intended to imply that bloggers can’t be journalists – NYT

Mohamed El-Erian: Kim is a “second best” nominee – Project Syndicate


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