gov't intervenes in private corporate pensions

D: the student loan coverage can wait.

I should flesh out the state of the nation on pensions first.

Pre-subprime-mortgage-crisis, companies had what seemed superficially to be stable private pension plans.
I say superficially, because past changes in rules by a past government ensured this would not last.
Inevitably, some crisis or crash or bubble bursting would have brought us to where we are today.
Which is: government either throwing many private pensioners to the wolves. Or bailing them out.
Making private pensions look a lot like.... public pensions.

-----

http://www.theglobeandmail.com/report-on-business/retirement/retirement-dreams-under-siege/article1327536/

Pensions: What you need to know
84% of public service workers have pensions.
78% of these plans are gold plated defined benefit pensions
25% of private sector workers have a pension plan
16% of these plans are gold plated defined benefit pensions
11 million workers, or 60 per cent, of Canada’s workers have no pension at all
8 million or 45 per cent, have no pensions or registered retirement savings plans (RRSPs)

-----

D: what does this all mean?
Well "gold plated" turns out to be a term used due to an earlier government policy.
It was pushed for by companies to free up funds.

Jacquie McNish does us no service by usually using such morally-evaluative, emotionally-laden terms without defining them, or placing them in context. Jackqie, you wrote a hack piece.

---

At first, Premier Dalton McGuinty said Ontario had no plan to help GM top up its pension plan, which lacked sufficient money to cover all its obligations. He said putting money into GM's plan wouldn't be fair to other Ontarians.

But after the subject became a key issue in the negotiations, McGuinty changed his mind. This week, McGuinty acknowledged that some of Ontario's $3.5-billion contribution to the company could go toward the pension plan.

-----

D: how did things get so bad? And what is the distinction between tax-revenue based public pensions and private pensions?
Not much, apparently.
Everybody gets a pension, courtesy of the government, no matter what, apparently.
Why? Easy. Boomers are almost retired. They won't be picking up the tab.
You will.

-----

As the retirement dream fades, policymakers seem unwilling to tell Canadians they have not saved enough to retire.

“We have overestimated our capacity to protect the needs of retirees,” says Harry Arthurs, former head of an Ontario commission that identified numerous flaws in the province’s pension regime.

“We now know there is no such thing as a pension or retirement promise,” Mr. Arthurs says. “There is no certainty.”

----
D: funny. That is the exact opposite of the truth. Generationally speaking, at least. For the Boomers.
Everybody who is a Boomer gets to win. Merry Christmas, ho ho ho.
But there is a price to pay. By somebody else, naturally.
If all the Boomers win.... everybody else LOSES. Gen XYZ.

------

The Record: In a speech in Kitchener recently, author and economist Sherry Cooper suggested that baby boomers shouldn't retire at 65. She pointed out that the average life expectancy was only 62 when the government set the age of retirement at 65. "Retirement was never meant to be 30 years," she said.

http://news.therecord.com/article/547593

------

D: originally, wasn't it age 70? How ironic. Now we are talking about moving it back to 70 again.
With life expectancy increasing, we may see retirements that last nearly as long as work careers!
Witness: School to 25, work 25-50, early retirement 50-75. OK, I had to finesse the timeline a bit. But you see what I mean.
That is a whole lot of Boomers who can expect to live to 75 or so retiring as early as 55.
God forbid is some miracle drugs suddenly increase life expectancy!
Here is my prediction: this will be phased in to the future, with warning, so as not to ruffle Boomer feathers.
"But we have only planned for the present retirement age -this upsets our plans", they'll cry.
Meaning.... the age of retirement will only be increased for Generation X, and following generations.

Do you see the pattern yet? Pay-go was predicted in the 1990s to become too expensive (code for: Boomers would need to pay their share, in part, before retiring, despite very low initial CPP pay-in the first half of their work lives).
It would get expensive by 2010- now - and the Boomers will be working in significant numbers for another 10-20 years.
Ergo, any spike in the pension pay-in needed to be deferred until 2020-30. The system allows for a .2% increase/year.
If at 2020 this increase begins, only the quasi-Gen X late Boomers will get clipped.
Here is my prediction. In 2020, despite seeing the same numbers and trends as 2010, the Boomers will suddenly 'discover' that the finances are not in place. In 2020 until 2030, the .2%/yr. rule will increase CPP pay-in from. c.10% to 12%. And so on. Until the Generation Z workers retire with an almost 20% CPP rate at the end of their work lives. Only to find out there is nothing left. In this respect, after the Boomers, we may well see a conflict between gens X and Z, with Y waffling in the middle.

------

Under provincial legislation, the Ontario government has responsibility for ensuring the viability of GM's pension plan in Canada. Mr. McGuinty said yesterday the province is considering helping the company restructure the pension funds.

---

D: ummm.. why?!

----

The solvency deficiency - or shortfall in the funds if the company were to fail - was $4.5-billion in November, 2007.

Pension experts said yesterday that one solution could be similar to the action Ontario took earlier this decade when Algoma Steel Inc. made its second trek through creditor protection. In that case, the province took over financing the pensions of Algoma retirees, through the Ontario Pension Benefits Guarantee Fund, an insurance fund to which employers contribute, but which is now in deficit.

----
$$$ . !!!.

---

http://www.thepolitic.com/archives/2009/04/23/mcguinty-refuses-pension-bailout-for-gm/

McGuinty refuses pension bailout for GM
April 23, 2009 · By Charles Anthony
This is one of the few times that McGuinty actually makes a worthwhile decision, in my opinion.
Given that Ontario has already given billions in aid to domestic automakers over the past few years, using taxpayer money to guarantee auto worker pensions when 65 per cent of Ontario residents have no pension plan at all would be a tough sell, McGuinty told reporters.

----

D: it is now too late to just say no. Now is time for the slippery slope.

Apparently the solution is to cover everyone!!! Let's use the credit card to have a party! Everyone's invited, woo hoo. How will we pay it off? Don't worry about it - have a beer!

Wonderful.

------

http://www.uniontech.com/Archive/PostonWEB/PensionReform%20No.4.htm

The Rules as They Stand
Under the current rules, when all the assets of your former employer have been devoured by secured creditors, and your pension fund only covers 60% of its obligations, each former employee and former member of the plan gets 60% of their entitlement. In Ontario, when the resulting pension is less than $1,000 per month, it would be topped up by a little-known public insurance enterprise called the “Pension Benefits Guarantee Fund” – operated by the Province of Ontario, and funded by premiums paid by the likes of General Motors – employers with pension plans which are not fully funded.
It appears that the level of premiums paid was set way to low. On March 31, 2008, the PBGF reported a deficit of $102 million. The deficit in General Motors (Canada) pension funds exceeds $5 billion. Any new claims on the Guarantee Fund will inevitably turn into a liability for the taxpayers of Ontario...

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http://www.bnn.ca/news/4929.html

In Canada, the automaker is in compliance with all legal requirements and has a smaller shortfall when the pension funds are measured on a going-concern basis, which essentially amounts to pay-as-you-go.
GM is the only company in Ontario that is permitted to make annual payments into the province's Pension Benefits Guarantee Fund instead of being required to finance its pensions on a solvency basis.
GM became eligible to do that in the early 1990s when the Canadian units of the Detroit Three and steel makers Algoma Steel Inc. and Stelco Inc. were granted relief from onerous pension payments in part because the government agreed they were too big to fail.
A senior Ontario government official said the province is aware of GM's pension shortfall and it will be taken into account in negotiations over providing assistance to the auto industry. The government has not yet seen the automaker's books.
"The ramifications are enormous," the official said.

----

D: "Because they (GM et al) were too big to fail"!
Oh, the laughter! The bitter tears...
It gets better. The other 2 companies are .... wait for it - Stelco and Algoma!
Who are these guys who passed this! Can we play pinata?

Don't worry, Boomers. Any government deficits won't be paid off in the next ten years of gradual recovery.

A book called "Unnecessary Debt" talks about this. The problem with running deficits during a recession is not the debt per se that results. The problem is a lack of discipline once times are good again. The result can be a gov't debt level that shows an 'escalator effect'. I.e. it goes up, levels out, goes up again - but never gets reduced.

----

I'll take a look at consolidated gov't debt another day. I"ve looked it up before, and it is fairly involved.
It becomes even more complex when both unsecured future entitlements, and neglected public infrastructure gets factored in.

CPP pension plan. a history to present.

CPP History:

CPP was created in 1966 as a pay as you go system i.e. the current working generation would pay for the pension benefits of the previous generation. It was a workable system in 1966 with retirement age of 70, a healthy economy and rising wages[1]. 30 years later in 1996 the plan received $11B in contributions and paid out approx. $17B in benefits with a deficit of $6B in that year. With contributor to beneficiary ratio expected to drop to 3:1 by 2030 major overhaul of the system was required to avoid a disastrous situation.

http://www.weblivepro.com/articles/cpp/cppinfo.aspx (pic)

D: That's right - it took 30 years for governments to turn the pension plan into a train wreck.
Why? Cuz Boomers did not want to pay taxes (or other payroll deducations) during their work years.
Did nobody NOTICE for 30 years the inevitable result of this laxness?

Wiki:

The CPP program mandates all employed Canadians who are 18 years of age and over to contribute a prescribed portion of their earnings income to a nationally administered pension plan

D: it is big government. It is coercive.

The CPP is funded on a "steady-state" basis, with its current contribution rate set so that it will remain constant for the next 75 years, by accumulating a reserve fund sufficient to stabilize the asset/expenditure and funding ratios over time. Such a system is a hybrid between a fully funded one and a "pay-as-you-go" plan. In other words, assets held in the CPP fund are by themselves insufficient to pay for all future benefits accrued to date but sufficient to prevent contributions from rising any further.

D: that's the technobabble.

History:

D: planned under the government of the Conservative Dief.

D: the first crisis:

At its inception, the prescribed CPP contribution rate was 1.8% of an employee's gross income up to an annual maximum. Over time, the contribution rate was increased slowly. However, by the 1990s, it was concluded that the "pay-as-you-go" structure would lead to excessively high contribution rates within 20 years or so, due to Canada's changing demographics, increased life expectancy of Canadians, a changing economy, benefit improvements and increased usage of disability benefits.

D: what was the problem? The key passage was "within 20 years or so" - the boomers might still be working!
THAT made it a 'crisis'. Delaying the crisis by 2-3 decades makes it sound Boomer planning...

http://www.hrsdc.gc.ca/eng/publications_resources/cpp/2007/annual_report/CPP_Eng_Report_FINAL.pdf

a faiR aPPRoaCh to funding
When it was introduced in 1966, the CPP
was designed as a pay-as-you-go plan, with a
small reserve. This meant that the benefits for
one generation would be paid largely from the
contributions of later generations. This approach
made sense under the economic, financial and
demographic circumstances of the time. The period
was characterized by a rapid growth in wages and
labour-force participation, and low rates of return
on investments.

D: and with a signature on the new bill, the Boomers were let off the hook to pay for their own retirement


D: let's tease these factors apart, and examine them one at a time.

1) changing demographics
2) increased life expectancy
3) changing economy
4) benefit improvements and increased usage of disability benefits.

D: Let's address them in order.
2) changing demographics.
(see pic 2)
D: seems to me, the whole wide world realized that life expectancy was increasing.
Well, maybe the RATE increased?
http://www.efmoody.com/estate/lifeexpectancy.html
Nope. The opposite. The increase in life expectancy actually slowed. So if anything, the plan should have shown a surplus.
1) changing demographics.
(pic).
Nope. Same thing. Bullshit. The immigration rate was HIGHER prior to the passing of the pension plan.
Once again, we'd expect the plan to overbudget for demographic shifts.
Once again, we get the opposite.
3) changing economy.
http://www.theoildrum.com/uploads/12/interest_rates.jpg
OK... got me there. That is some dismal real interest return rates.
4) if they expand benefits, who can act surprised?
So in summary, by and large, we get fed a line.

D: there is an old saying. Fool me once, shame on you. Fool me twice, shame on ME.
You're not fooling me twice.

D: the solution?

"Move towards a hybrid structure to take advantage of investment earnings on accumulated assets. Instead of a "pay-as-you-go" structure, the CPP is expected to be 20% funded by 2014."

D: leave post-Boomers with the bill?

----
Tomorrow we'll look at post-secondary education funding, and related student loans.

You will begin to see a pattern. I'll explicitly outline that pattern after entries cross-referencing income tax and pension pay in rates. One needs to look at the Boomer at every stage of voting life to understand just how pernicious the 'benign neglect generational model' can be, without any need to invoke conspiracy.
I'd note that a quasi-Marx-class-derived age-based analysis is entirely absent from both the public discourse and policy.
Like feminism, this model needs to create 'class awareness'. By that I not only mean for young people, but also for older people- Boomers really - so they realize where their policies lead. That leaves them with 2 options. They can acquiesce to these policies, knowing where they lead- and thereby become complicit- or join in becoming part of the solution.
For younger adults, awareness can replace apathy with anger. This anger can be used destructively or constructively.
Why rant about 'no future' when one can wrest from time the future one wants, bend fate to one's will?

the history of demographics. rise of the baby boomers.

D: the pic is from Bubblegum Crisis, which is Japanese Anime. The robots in it are called Boomers, as the builders of prosperity that will herald an new economic boom. It doesn't turn out that way...

D:

A baby boomer is a person who was born during the demographic Post-World War II baby boom. The term "baby boomer" is sometimes used in a cultural context, and sometimes used to describe someone who was born during the post-WWII baby boom.

D: a truncation of "Post WWII baby boom".

In general, baby boomers are associated with a rejection or redefinition of traditional values; however, many commentators have disputed the extent of that rejection, noting the widespread continuity of values with older and younger generations

D: LOL. Riggghhhht.

"Turn on, tune in, drop out" is a counterculture phrase coined by Timothy Leary in the 1960s. The phrase came to him in the shower one day after Marshall McLuhan suggested to Leary that he come up with "something snappy" to promote the benefits of LSD[citation needed].

D: Sell out. The flower children were a highly visible fringe, but hardly mainstream.
Any more than Gen X can be identified with, say, big-haired heavy metal with leather jackets and torn jeans.

Flower child or Flower Children originated as a synonym for hippie, especially the idealistic young people who gathered in San Francisco and environs during the 1967 Summer of Love. It was the custom of "flower children" to wear and distribute flowers or floral-themed decorations to symbolize altruistic ideals of universal brotherhood, peace and love. The mass media picked up on the term and used it to refer in a broad sense to any hippie

One of the unique features of Boomers was that they tended to think of themselves as a special generation, very different from those that had come before. In the 1960s, as the relatively large numbers of young people became teenagers and young adults, they, and those around them, created a very specific rhetoric around their cohort, and the change they were bringing about.[3] This rhetoric had an important impact in the self perceptions of the boomers, as well as their tendency to define the world in terms of generations, which was a relatively new phenomenon.

D: The original "ME generation". Forget the I-pod toting youths...

D: so who are Boomers?

Definition

The United States Census Bureau considers a baby boomer to be someone born during the demographic birth boom between 1946 and 1964.[8] The Census Bureau is not involved in defining cultural generations.
William Strauss and Neil Howe label American Baby Boomers 1943 to 1960.[9]
In Ontario Canada, one influential attempt to define the boom came from David Foot, author of Boom, Bust and Echo: Profiting from the Demographic Shift in the 21st Century, published in 1997 and 2000. He defines a Canadian boomer as someone born from 1947 to 1966,

D: I'll use 1946 to 1966 for simplicity's sake.

D: characteristics of the Baby Boom. They're huge!

Size and economic impact
Seventy-six million American babies were born between 1946 and 1960, representing cohorts that would be significant on account of its size alone.[citation needed] This cohort shares characteristics like higher rates of participation in higher education than previous generations and an assumption of lifelong prosperity and entitlement developed during their childhood in the 1950s.
The age wave theory suggests an economic slowdown when the boomers start retiring during 2007–2009.[14]


D: and identity. They saw the imperialistic foreign occupation and forced conscription to wage war in Vietnam.
Whatever glory war promised in the Great Wars -despite the shocking carnage - was finished in Vietnam.
And saying "I'm a pacifist" sounds much better than "I'm a chickenshit"!

D: so they define themselves as 'against the system' more than before. And then... became the system.
Not only sold out, but then placed their thumb on the generations after them.

D: they VOTE.

"Older voters are interested in the economy, trumping pretty much everything else, with healthcare coming in a distant second," says Andrew Nannis of AARP, an advocacy group for the 50-plus set.

Each generation may have viewed the economy somewhat differently. "For younger voters, it was jobs; for a person with a new family, it was housing; for boomers, it was their retirement and pensions and 401(k)'s; and for older seniors, it was their children's and grandchildren's economic future," MacManus says.

D: US stats. I imagine they hold up here.

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D: so what is Generation X?

Generation X, commonly abbreviated to Gen X, is the generation born after the baby boom ended [1][2], with earliest birth dates used by researchers ranging from 1961 to the latest 1981

The term was first used in the UK in a 1964 study of British youth by Jane Deverson. Deverson was asked by Woman's Own magazine to interview teenagers of the time. The study revealed a generation of teenagers who "sleep together before they are married, were not taught to believe in God as 'much', dislike the Queen, and don't respect parents," these controversial findings meant that the piece was deemed unsuitable for the magazine. Deverson, in an attempt to save her research, worked with Hollywood correspondent Charles Hamblett to create a book about the study. Hamblett decided to name it Generation X.

Generation X in the United States

Individuals considered to be within Generation X were born, and grew up during the later years of, and in the decade following the Vietnam War. They are most often linked to the presidencies of Ronald Reagan and George H. W. Bush.[17] Coming of age after the Vietnam War had ended, their political experiences and cultural perspective were shaped by the end of the cold war and the fall of the Berlin wall. Growing up in an historical span of relative geopolitical peace for the US, this generation saw the inception of the home computer, the rise of videogames, and the Internet as a tool for social and commercial purposes. Other attributes identified with this demographic are Dot-com businesses, Desert Storm, 80's rock, such as Van Halen and Bon Jovi, Heavy Metal, grunge and hip hop culture and punk rock bands such as The Ramones.

D: OK we have a definition problem. If Boomers are born until 1966, how can Gen X be born as early as 1961?
The answer is that late Boomers share much in common with early Xers.
If we chunk by 20 year segments we get 1946-66, 66-86, and 86-2006.
If we chunk by 15, we get 1946-61, 61-76 and 1976-1990.
This is handy, since it gives us 3 generations that are now adults, with an additional one growing up.

D: I read Douglas Coupland on Gen-X. I found it trite.

What is Generation Y?

Characteristics of the generation vary by region, depending on social and economic conditions. However, it is generally marked by an increased use and familiarity with communications, media, and digital technologies. In most parts of the world its upbringing was marked by minor decrease in the Socialist approach to the politics and economics

Generation Y, also known as the Millennial Generation or Generation Next or Net Generation,[1][2][3] describes the demographic cohort following Generation X. Its members are often referred to as Millennials[4][5] or Echo Boomers[6]. As there are no precise dates for when the Millennial generation starts and ends, commentators have used birth dates ranging somewhere from the mid 1970s[7][8][9][9][10][11][12] to the early 2000s.

OK the 1976-91 span is too limited, but this is the nature of arbitrary time periods.
Let's just lump all the young adults after gen X in here for now. Their situation has more in common than not.

Generation ME?


They’re self-absorbed, spoiled and entitled — otherwise known as Generation Me. Learn why so many young people are pursuing fame and fortune, and are also miserable. And, find out if you’re unknowingly raising a child to be like this.

D: sound familiar? Self absorbed, with a sense of entitlement? That is right - Boomers.
The pot calling the kettle black!
You will need to become used to sanctimony and hypocrisy like that, on this blog.

I nominally call the tail end of Gen-Y (aka: ME) and what follows as Generation ZEE.
Why Z?
End of the line.
For social programs, for moderate taxes, for a slice of the pie in general.

-----
Tomorrow, I will extrapolate the Boomer retirement pattern, their effect on taxes/payroll fees, on balanced budgets, and on social program impact as well as WHICH programs will get funding.

The earliest Boomers are starting to retire now.
Those born in 1946 are now... 64. A fringe have already taken 'Freedom 55'.

----
http://www.carp.ca/

D: CARP used to be for truly old - retired - persons.
They adjusted their target demographic to include all Boomers. And no X Y or Zers...

CARP (Canada)
From Wikipedia, the free encyclopedia
CARP (originally the Canadian Association of Retired Persons, now billed as Canada's Association for the Fifty-Plus) is a Canadian organization advocating for the rights of those fifty years of age or older.
The original mandate of CARP was to represent retired persons specifically, but for various reasons it has since expanded to cover the rights of all persons over fifty.

D: the Boomers have now commandeered what WAS a group representing the interests of retired persons.

The Boomers now have
1) numbers
2) money
3) political awareness- they VOTE.
4) political organization - they LOBBY.
One person, one vote. Or one dollar, one lobby vote.
Either way, they WIN.

Look grim, doesn't it?

It is.

introduction to blog theme. about me.

CBC News
Canada's federal budget watchdog says the government's current fiscal structure is not sustainable if the aging of the country's population is not addressed.

In a report released Thursday, the Parliamentary Budget Office said long-term projections suggest that an aging population means that growth in Canada's real gross domestic product per capita will fall by a little more than half over the next 50 years.

"After growing by 2.1 per cent, on average, since 1961, real GDP per capita growth is projected to average only 0.9 per cent from 2009 to 2059," the budget office said.

Read more: http://www.cbc.ca/canada/story/2010/02/18/government-parliamentary-budget-office-aging.html#ixzz0fuSrKfon

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D: We have all known such things for a great many decades now. Why the fuss now?
Easy. The Baby Boomers are retiring.
Meaning that Generation X, Y and Z can pick up the tab.
Our folks have been like the blind date nobody wants. Leaves early, and leaves us to pick up the bill.

A few weeks ago, I read about some scheme to expand CPP pension coverage to all sorts of folks not covered by the plan.
Why? Boomers aren't picking up the tab. We are. They have our cheques, and have figured out how to forge our signatures.
As if somehow that implied consent, or even acquiescence.

----
About this blog.

I hope to write my grad thesis at UWO starting in 2011. It is on the subject of intergenerational politics. I've already done much reading on the subject. The UWO prof James Cote is a favorite author of mine.

Over the next few blogs, I will outline the general theme of this blog. Briefly, I call it 'feminism lite' but with an age twist instead.
Why feminism? It is a "conflict theory". Various interest groups are fighting for their slice of the pie. Or all of the pie, if they do it right.
Why "feminism lite"? It is light on conspiracy and outrageous Illuminati-esque premises. No secret patriarchy. No plot to keep women - or younglings - in their place.
I adhere to what I call the "benign neglect" model. What seems good depends on your vantage point. A police officer and a drug addict see different goods. One need only fail to consider alternative perspectives from alternative positions in life to convince oneself that one's own interests are 'the good'. As opposed to 'a good'. Or just one's own interests...

I will pick one subject each day to expand upon.

A word about terms.
I define Boomers as born 1946-1966.
Gen X, Y and Z are my naming conventions. Why? Cuz Z is the fiscal 'end of the line'.
They'll be squeezed dry and have no programs waiting for them.
The terms are more concise than reality. Late Boomers share some resemblance to early Gen Xers and so on.
However, I will point out turning points in government spending and fiscal policies and social programs, and link these to a 'rising tide' and 'critical mass' in the voting demographic.
Say it again: benign neglect.
We'll track tax and spending trajectories through the decade, always asking the question "who benefits?"
We'll find that the Boomers like programs when they are not paying in, at the beginning and end of their work careers.
We'll see they dislike taxes when they work - and that includes such things as pension pay in.
We'll break down money-in versus money-out for the various generations.
I'll extrapolate the future lot in life of the various generations.
The 'business as usual' model, based on the 'benign neglect' thesis, should prove to be a wake-up call.

Various age-related issues will be discussed. This will include GenZ issues, even for those that cannot yet vote.
----
About me:
I'd argue that my autobiography is relevant to an age-related blog. I've never bothered before.

1971- born on tobacco farm outside small SW Ontario town
1982- father having mental problems. parents separate. mother gets custody. move to town.
1983-4 -father dies. move to mid-sized town. mother picks up pre-farm-wife vocation to support kids
1990 - complete high school. get adequate marks to go to University of Windsor for sociology
1990-1997 - take time, end up 1 course shy of 4 year combined honours soc/crim and 3rd year poli-sci.
1998 - cannot delay 'real world' any longer. a decade of temp work and entry level mcjobs await me
2009 - three years of entry level food factory cleaning is enough. i retrain as security guard (better for school)
Security guard card repeatedly lost in mail or by gov't bureacracy. I spend 60 days doing general labour for buddy, who then goes bankrupt. I'm left severely overextended and without a line of credit or any reserves by this point.
I have never managed to pay down my student loan significantly. I go bankrupt. I'm done this September 2010.

I won't claim I am a typical Gen Xer, since there are many types of us. But many of my smart liberal arts grad friends are working in similar entry level jobs. Living their lives of quiet desperation, even a decade later.

Let's track my 'career path' (such as it is) in reference to generational programs and taxes/fees.
1991 - begin university. This is the year grants are ended.
1990s - the beginning of double-digit percent tuition increases. the banks get nervous about defaults.
I initially tried to meet the payments with temp work. Inevitably I overextended, and needed to get bailed out by family.
Briefly, I could have bankrupted.
New rules came into effect. First a student loan could not be defaulted upon for 2 years. Then it was TEN YEARS.
My earlier failures meant I did not qualify for the later 5-year-mark loan reduction scheme based on repayment difficulties.
Recently, the rules changed back to SEVEN years out of school to default.

For years now, I was treading water on interest payments only. Entry level jobs pay for living costs, and that's about it.
Once my family would not support me, I could not risk over-extending to make inroads into the principal debt due.
I could not go back to school still owing a student loan. For starters, I have no savings. None.
Plus it would reset any potential bankruptcy date. If I take 6 years to get an MA and PhD, and start in September 2011, I could well end up RETIRING still owing the debt. Assuming I retire.
Plus I have no credit at all due to my student loan. And would not likely qualify for another!

I was very bitter about school and money and career in my 20's. In my 30's, I've evolved into cynical.
I certainly didn't expect to face 40 still at an entry level job, with no savings.
The idea of paying for a house is starting to look implausible. So too, saving for retirement, if the last 15 years are any indication.
In high school, I flipped burgers for 6.35/hour. Adjusted for inflation, I've never made much more than that.

So through my working years, I've been tracking the history of what Baby Boomers (BBs) did to student loan and tuition subsidies once they were done with education themselves. Now I am watching their attempt to mini-max (minimum in, maximum out) the pension programs. So too all the social programs, including health care.

We've known for quite some time- decades in fact - that there will be a whole lot of retired boomers with not so many sub-boomers supporting them. Instead of feeling good about ourselves for having relatively low government debt, we ought to have a surplus saved up for all these future program entitlements.
I'll track the consolidated government debt levels since WWII to indicate the generational aspect, and extrapolate the 'business as usual' model into the future.

Cheers.