Tom Brokaw named our parents The Greatest Generation. They came of age during The Great Depression and defeated Fascism, Nazism and Communism. They built the Interstate Highway System and landed a man on the moon. They built the great American middle class with safe communities and public schools that were the envy of the world. They deserve the title of The Greatest Generation. One of their few criticisms is that they spoiled us boomers, adhering to the teaching of Dr. Benjamin Spock.
I am 59 years old and a child of perhaps the most indulged and impatient generation in history. I fear we may also become known as the generation that lost the American Dream. The Baby Boomers have rejected personal responsibility and exhibited a lack of mental discipline that could have enormous implications for the future.
The United States House of Representatives, now overwhelmingly controlled by the Boomers, signed a $787 billion legislative “stimulus” package comprised of 1,071 pages and a hefty 8 pounds. Not one legislator read the bill before signing it. Months later, the same House members publicly screamed at the corrupt executives of AIG who received bonuses in 2008 – bonuses specifically allowed in the very legislation they passed without reading.
This abandonment of personal responsibilities by the Lost Generation took on historic significance on January 20, 1993. That’s when the first President Bush, a member of the Greatest Generation, was replaced with President William Jefferson Clinton, the first Baby-Boomer to reach the Presidency. The Clinton presidency was notorious for its personal indulgence – and not just by introducing oral sex to the Oval Office. During Clinton’s watch, 100,000 Islamic terrorists were trained in camps in Afghanistan while terrorist strikes against American interests went unanswered. Clinton failed to respond to the attack on the USS Cole that killed 17 servicemen. Our enemies grew emboldened believing that America did not take their deadly threats seriously. On September 11th 2,996 American civilians died in part because the government did not see its first priority to be protecting them.
Also under President Clinton, the Federal Government in 1999 relaxed Fannie Mae and Freddie Mac’s requirements of home mortgages. The decades old formula of 20% down and a 30 year fixed mortgage that allowed the Greatest Generation to lift home ownership to more than 60% was replaced with an array of instruments including sub-prime loans, “no-doc” applications where income was not verified, and teaser rates of 1%. Such tinkering led to unqualified purchasers with 100% financing pushing home values up at 20% per year. The bubble burst in 2007 with disastrous consequences. The heads of Fannie Mae and Freddie Mac made tens of millions in annual salary. Despite the calamitous consequences of their stewardship, no one was fired.
Another Boomer, George W. Bush followed Clinton and continued the Lost Generation’s abdication of personal responsibility. He also failed to comprehend the extremist Islamic threat. Again, no one was fired. On December 12, 2002, George Tenet, fellow Baby-Boomer and Director of the CIA assured President Bush the case that Saddam Hussein had weapons of mass destruction was a “slam dunk”. President Bush authorized the invasion of a sovereign nation based on that intelligence. No weapons of mass destruction were found. America’s soldiers inherited a broken country and hundreds of billions of responsibilities. No one, including George Tenet, lost their job. In fact, on December 14, 2004, President Bush awarded Tenet the Presidential Medal of Freedom.
On August 29, 2005, Hurricane Katrina slammed into Louisiana and Mississippi as a Category 3 hurricane. The result was catastrophic. The levees were breached and 1,836 Americans lost their lives. Americans watched in horror as police abandoned their positions, and the National Guard struggled to protect the trapped citizens who could not evacuate. Dead bodies lay uncollected in the streets. No one will forget the scene of 60,000 American refugees at the Louisiana Superdome without food, water or medical care for days. On national television, President Bush proclaimed, “Brownie, you’re doing a heck of a job.” Although three days later, FEMA Director, Michael D. Brown was forced to resign, no one else at FEMA was fired.
In July 2008, gasoline prices hit a national average of more than $4.00 per gallon as demand outstripped supply pushing oil to $147 barrel. The Lost Generation howled in protest at the oil companies who were profiting from the pain of American citizens. This came as no surprise. The environmental movement had stopped production on both nuclear power plants and gasoline refineries. Congress banned oil exploration off America’s coastline. Congress decided that ANWAR, a barren strip of coastal Alaska the size of Logan Airport in Boston, was off-limits to oil exploration. At $147 barrel, the Western economies were shipping more than $1 trillion dollars per year to the Persian Gulf to nations whose interests were simply not aligned with ours. Once again, our elected officials, dominated by boomers, abdicated their responsibility to keep America safe. Their inaction allowed our nation to become even more vulnerable to the oil weapon.
In 1973, under President Carter, when the OPEC nations first used oil as a political weapon, America imported 30% of its daily oil quota. Yet not a word is mentioned by the Lost Generation expanding American production of oil to reduce this dependency. Yes, they talk of wind and solar energy – which collectively generate less than one percent of our energy – but no one has yet figured out how to power a car with wind or solar energy. After falling to $30 a barrel, oil has slowly crept back up over $50 a barrel – in a deep recession. When the recovery arrives, does anyone believe oil will not return to $100 barrel? Yet the Lost Generation sleeps with no energy policy in place and once again abdicates its responsibilities to a future generation.
The same is true of Social Security. The Baby-Boomers are retiring now. The system is broken and there are not enough workers to make the transfers to the retirees. Do you hear anyone in Washington raising the red flag of warning? Once again, the Lost Generation has abdicated its responsibilities and kicked the can down the road.
In the waning months of the Bush Administration, Treasury Secretary Paulson informed Congress that a $700 billion bail-out of the financial sector was needed to avoid a melt-down of our banking system. TARP, the Troubled Asset Relief Program was passed by the Congress in a matter of days. Only $350 billion was committed, banks were forced to accept TARP funds, and little of those funds made their way to acquire troubled assets. GM and Chrysler received $17 billion even though they had no “troubled assets.” Another $8 billion went to Sheik Mohammed in Dubai. He had no troubled assets either, and $1.6 billion was paid out in bank bonuses. AIG received $165 billion of TARP money and paid out $286 million in bonuses. No one in Congress anticipated the AIG bonuses when they signed the legislation that specifically allowed the payments. It does not end there.
Franklin Raines, chief executive of Fannie Mae received $91.1 million in compensation from 1998 to 2004. In 1998, Fannie Mae stock was $75 per share. Today, Fannie Mae shares are worth 67 cents. Mr. Raines was not fired – he was simply hired as an economic advisor to President Elect Obama. Raines recently settled a civil lawsuit alleging fraud and stock manipulation for $31.4 million.
Postmaster General John Potter received compensation of $800,000 in 2008 while the United States Post Office lost $2.8 billion. It is possible his $135,000 bonus was based on future performance. The USPS is projected to loss $6 billion in 2009. Postmaster Potter did not lose his job either.
Our congressional representatives earn $174,000 per year for this fiscal oversight. Their congressional staff earns another $1.3 million per year plus too many perks to mention like free cars, airfare, and postage stamps.
The very things that we took for granted as children of the Greatest Generation are now challenged. Home values have fallen dramatically. Our retirement accounts have been decimated. Our public schools are not working. Traditional allies no longer stand with America. Not surprisingly, most Americans fear their children will not be better off. The approval numbers for Congress are at an all-time low. Despite the vast number of problems facing our country in 2009, when Congress passed a Continuing Resolution in March 2009, it contained 8,500 earmarks of pork barrel spending confirming that this Congress is going to maintain business as usual.
Dr. Spock wrote that our parents should not spank us and they should always bolster our self-esteem. That misguided advice led to the today’s climate of political correctness where the ideal of self-esteem outweighs the importance of performance, success or accomplishment.
Consequently, the Lost Generation measures itself by its good intentions rather than by its accomplishments. Its good intentions led to policies that prohibited oil exploration off the coastlines. The result was $4.00 gasoline. Its good intentions of teaching all children in their native tongue was a good idea but the cost to do so weakened the overall education system in America. Its good intentions of helping poor families buy homes led to the sub-prime mess that has cost American families trillions in lost equity. In the last twelve months, under the dominant control of the Baby-Boom generation, America has witnessed $11 trillion of home and stock equities disappear.
The Baby-Boomer's move into retirement comes none too soon. Let the boomers in Congress retire at 65. We’ll even let them retire on the fat retirement plans they voted for themselves. But let’s get rid of them. The next generation can’t do much worse.
Robert J. Cristiano Ph.D. has more than 25 years experience in real estate development in Southern California. He is a resident of Newport Beach, CA.