Class '03: you're Screwed

Dear Graduates: Remember at commencement when you were told repeatedly about the world of opportunities waiting for you--that the investment you and your parents made in your education would be returned a thousandfold?

Utter crap. The truth is, you are royally screwed.

As you've noticed by now, the job market has not been worse since Bush the Elder was president. You're in line behind 8.4 million workers who've lost their jobs, with 2.5 million private nonfarm jobs lost on the president's watch. The only workers the federal government's policies are helping are military contractors and financial planners who can tell the richest one percent how to maximize their tax refunds.

The administration keeps talking about investing in the future. But the president is not planning to invest in your future. Bush's proposed cut on the taxes paid on dividends would deliver $364 billion to those who have already made their way in the world. Based on 2001's tax returns, Bush would pocket an estimated $44,500 a year. Cheney would save $326,555, which is probably one of the smaller paydays in an administration full of former chief executives.

Those who have incomes of $1 million will get an average $90,000 kickback annually, enough to buy a Humvee in a designer color. For half of all filers (e.g., you, should you get a job), the refund would return less than $100, enough for a Game Boy Advance SP (minus the game). Most senior citizens would get back $89, barely enough to buy a month of the prescription drug Lipitor--from a Canadian pharmacy.

At the end of the Clinton era, the government was projecting a surplus of $3 trillion over the next 10 years. If he wins a second term, Bush will leave the White House having saddled the country with a projected deficit--and these are government statistics, which are always rosy--of $2 trillion. The swing from surplus to deficit ($5 trillion, give or take) is roughly equal to half the value of everything made and sold in the U.S. in the past year. It will be the most money owed by any entity in history. The combination of cutting taxes and launching the military budget to an all-time high will continue to run up the nation's bills long after the capital gang departs.

The debt now stands at roughly $90,000 per family of four. In five years it may be half again that. Servicing that debt, which will be your responsibility, will feel a lot like paying a mortgage on someone else's house.

Say you have been lucky enough to find a good job. Look at your paycheck. After Bill Clinton raised taxes, in part to pay down the debt, the economy picked up and tax revenue increased markedly. For a few years it looked as if the perennial prediction that Social Security was doomed would be proved wrong. Social Security is again in danger, and the crisis will hit long before you see your first retirement check. Instead, it will hit when your parents become eligible. When the government cannot pay your parents' checks, their care and feeding will fall entirely on you.

Now might be a good time to start planning that home addition--the one where your parents will live when their money runs out. That is, if you can afford a house. When the government spends vast amounts of money it doesn't have, it needs to borrow increasingly vast amounts to keep up. That has a tendency to drive up interest rates. The last time the U.S. paid for an expensive war was Vietnam. At the time, the U.S. hunger for money upset world credit markets so severely that it took 20 years to recover. Interest rates ran as high as 17 percent. Don't have a mortgage yet? Imagine one with almost triple the monthly payment. Think small.

Don't expect the government to Build a Better Tomorrow. Once, Washington invested heavily in science, education and the arts. The space program was once the pride of America, not an underfunded studio for disaster footage. Advances in science were made routinely in great public labs by scientists who went to college with government help. As money grows tighter, the government will play a decreasing role in seeding the future.

Debt creates a future in which the government works against our best ideas of ourselves. If this trend continues, we may end up with the sort of government we fear most--one where our resources go into keeping order. All it will be able to do effectively is police and punish.

George W. Bush stole your future.