How much should less well-off young people be expected to pay, to shield wealthy oldies from a new disease?
Put like that, it may seem coldly utilitarian, but that is the stark reality being imposed on a generation of young citizens. COVID-19 is a disease which disproportionately threatens the over-70s. The explicit message being hammered by states imposing what, from any angle, is indistinguishable from a socialist police state, is that the young must make sacrifices for the elderly.
But, are the elderly who stand to benefit most prepared to reciprocate?
The young and poor have little say in society but they are incurring the bulk of the costs from the shutdown. Whether it’s their incomes, their schooling or their ability to enjoy life, the sacrifices that students and so-called generations X and Y are making for the over-75s are very significant. Unlike the Spanish flu 90 years ago, it seems coronavirus is of little threat to the vast majority[…]
And the bill will come long after those whom the younger generations have tried to protect have died. It’s reasonable to give some thought now to how the costs will be shared.
It could be said that COVID-19 is a force-multiplier on steroids for what Western governments have been dreading for decades: a tsunami of old people overwhelming a drastically-reduced workforce of taxpaying young people.
Everyone will suffer in degrees during this crisis, but it’s only fair that those who are being saved, especially if they are financially equipped, pay a disproportionate burden of the cost.
(It’s true retirees have seen huge falls in their superannuation balances, but once a vaccine is found in a year or two, their accounts are likely to roar back to life.)
The Commonwealth Seniors Health Card, which is a benefit for retirees who are too well-off to quality for the Age Pension, should be immediately dumped[…]Scrapping the seniors and pensions tax offset, which provides a tax-free threshold of about $33,000 for over-65s and about $58,000 for couples, is also a no-brainer. Naturally, these two changes will cause some discomfort for those affected, but nothing compared with the chaos recently foisted on millions[…]
Rather than taxing younger generations or workers to oblivion, it’s best to curtail generous arrangements, at least temporarily[…]
To be sure, this would cause real pain, given some retirees quite reasonably have structured their affairs around them. But this is a crisis.
More to the point, it’s an economic crisis that the elderly are far better equipped to ride out than the young. The Baby Boomer controls an astonishing proportion of general wealth: nearly 60% of it. Their younger siblings, Gen X, owns just a quarter as much. Millennials, just a twentieth.
This is far beyond the normal accumulation of wealth with age. Boomers have progressively grabbed a bigger slice of the pie than any other generation: more than double what previous generations owned at the same age.
Millennials would have to increase their wealth sevenfold to catch up to Boomers at the same age. Good luck to them, achieving that in an economy crashed and burned by a virus panic.
As in an ordinary war, the young are doing the heavy lifting and face a massive tax burden. It could be a bit less burdensome if reasonable, temporary tax increases were imposed for the over-65s to help defray the costs.
It’s important to keep perspective. Roughly 165,000 people die in Australia each year; about 3000 from influenza.
Meanwhile, the economy is being destroyed — real and permanent damage — for uncertain benefit.
If we totally shut down the economy, as many are advocating, when does it reopen? And if it reopens and the virus emerges again, is it shut down once more?
It’s patently not possible to keep turning an economy on and off every few months without destroying civilisation.
While it’s an amusing sport to poke fun at the foibles of Millennials, the fact is that they are being crippled with generational debt, and massively short-changed, in order to fund the comfortable retirement of Boomers. If their elders aren’t willing to share the financial burden of the Chinese virus, they might start asking if it’s even worth bothering.
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