When Judy and I first became involved in Gerontology, one of the major concerns was that people would outlive their money and end up old and poor. This was not just a worry among economists. Having lived through the Great Depression, older people were haunted by the specter that the economy might crash again, leaving them without basic resources to get along. There were places in the US during the Depression where as many as one half of people over 65 lived in poverty, with no pensions or possibilities of work. Their plight, which was described in a report by economist Paul Douglas, proved influential in passing Social Security.
Since Social Security was originally passed, the financial situation of older people has been shorted up by indexing benefits to the cost of living, reforming private pension, and of course by passage of Medicare, which takes away much of the burden of health care costs. But the safety net that protects older people from poverty is being threatened.
The threat comes from the new tax bill. Even with the most optimistic estimates of the potential stimulus to the economy, the tax bill will lead to a gigantic deficit. Depending on the final wording of the tax bill, that deficit may trigger an existing law that will make automatic cuts in Medicare and Social Security. And conservative politicians like Marco Rubio and Paul Ryan are already crowing about the prospects of doing away with both programs. This has been a long-term goal of many conservatives, but they did not talk about it openly, because Medicare and Social Security are popular among voters. It’s clear they no longer fear the voters.
Adding to the threat to Medicare and Social Security, the Trump administration is unraveling the protections that were put into place in our financial system to prevent another meltdown. Even something as basic as being able to get redress from a financial manager who knowingly sells you a bad investment has been pushed aside.
A new book, Nomadland, by Jessica Bruder, may be a harbinger of the future of old age in America. She describes the lives of a group of 50 older people who were hit particularly hard by the Great Recession of 2008, losing their homes and other investments. They now roam across the country, travelling where there are jobs, and then moving on when the job ends. They often do hard labor that would place stress on a younger person. Maybe the future will not be Mad Max riding through the country in a super-charged car, but us old folks driving down the road like the Oakies in the 1930s looking for a job.
I don’t think I am overreacting. The threat is real.