Last week in Santa Monica, California, President Obama spoke of the achievements of the millennial generation—those of us born after 1980 and before the mid-2000s. He praised millennials for being the most educated, energetic, and tech-savvy generation ever, but he left out one important distinction: We are the most indebted generation in American history. And President Obama’s fiscal policies are making it worse.
The class of 2015 will be the most indebted graduating class ever; each student will leave school with an average of $33,000 in student loan debt. Moreover, each individual’s share of the public debt now reaches about $40,000 and continues to grow.
Here are three major concerns millennials should have about the growing national debt:
- A high national debt hinders economic growth, which results in fewer jobs and less economic opportunity, which hurts everybody. It is already difficult to find a job in today’s market. Just imagine how much more difficult it will be as mounting debt discourages investment that enables companies to start up, expand, and try new creative approaches.
- The national debt is a threat to our economic freedom. Economic freedom is the ability to choose. We are economically free when we can earn and invest our money how we see fit without overly burdensome or unnecessary government regulations and taxes. Therefore, if Congress enacts tax increases to pay down the growing interest on the debt, then we will be allowed to keep less of what we earn, thus reducing our ability to choose.
- Entitlement programs—particularly Medicare, Medicaid, Social Security—are fiscally unstable and driving the increase in the deficit and debt. Without reforming the nation’s entitlements, our generation may be required to pay higher payroll taxes to cover the unfunded benefits of current retirees. Payroll tax increases would not solve the problem, but would only damage our economic freedom even more. Moreover, the Affordable Care Act, or Obamacare, adds $1.8 trillion to the spending burden over the next decade.
What should millennials do now? Our generation makes up nearly one-third of the population; we have the numbers and influence to make change happen. We must make our voices heard in Washington so Congress will make the necessary reforms to the budget and entitlements. Only when spending and debt are brought under control, can we be free to keep more of what we earn and continue to grow as the “generation of talented, striving, innovative, young people” that President Obama described.
Spencer Woody is currently a member of the Young Leaders Program at The Heritage Foundation. For more information on interning at Heritage, please click here.