Generational equity and the politics of the welfare state.

The concept of generational equity--that the nation is squandering its wealth on entitlements to the elderly while children remain impoverished--has received considerable media attention. The author traces the source of that message to an organization, Americans for Generational Equity, which is dedicated to restructuring the Social Security system along the lines of a social assistance program: reduced benefits available at later ages only to those who qualify through means tests. The impact of this agenda would be to increase the labor force participation of older people, particularly women and minorities, those presently without private pension coverage and already heavily represented in that sector of the economy where labor shortage is developing. Defining national spending priorities in terms of intergenerational conflict obscures the fact that Social Security is the only U.S. welfare program that has been successful in reducing poverty levels.