What If The Young Won't Work?Submitted by Dixie-Paleocon on Tue, 09/11/2012 - 11:25
Suppose the youth of this nation were unwilling or unable to work. What then would happen to the country? The answer to that question should be obvious. The country would become progressively poorer.
Government, no matter its intentions, cannot create product or wealth. They only redistribute it. If fewer people are willing to work and the population remains the same, then per capita wealth necessarily goes down. The rate at which it declines is a function of many things, although the labor participation rate is among the more important.
Productivity is an important element. People are more productive when they have better tools and equipment to work with. Included among their tools is an education. “Human capital” is primarily a function of the quality and quantity of education, something that has been in decline for decades. Tools and equipment are a function of past wealth creation or savings. As this diminishes, so too does the productivity of workers.
As the population ages, demographics come into play. An aging population means proportionately fewer people working and more not. Fewer people then must support more. Social security and medicare were both programs that depended upon their funding from those working. They were based on unreasonable assumptions (if you prefer, they were Ponzi schemes from the start) regarding demographics. As a result of rosy assumptions and increased benefits, these program are insolvent and will not last much longer in their current configurations.
Now it appears another factor is coming into play. The participation of youth in the workforce is declining. Bruce Krasting describes the deterioration: