Millenials Targeted: Obama Policies Demand Big Cash Sacrifices

Posted by Tina

Young people are the nations future. Knowing this, parents and leaders in the past have done a lot to educate and promote the youngest members of society. Not so with this administration. Whether mindlessly or by design, the policies and laws implemented over the past five years amount to a heavy financial sacrifice and transfer of wealth to government coffers from the nations young people.

Shortly after entering office the President took steps to “nationalize student loans and then began an ad campaign to push student loans. Few jobs prospects also made higher education look mighty attractive. The policy worked:

student debt load has skyrocketed. There are now more than 3 million households with debt of more than $50,000, an almost four-fold increase over a decade ago (in inflation-adjusted dollars), and 10 times higher than in 1989. And the debt is rising most quickly among the upper-middle-class households.

To counter growing concerns about rising student loan debt Obama toured the college campuses just prior to the 2012 election promising lower student loan rates in a sceme few would question:

…except that the president’s plan would apply only to those 23 million loans being borrowed directly from the federal government. Except that not all of those would benefit; it would apply only to the 9.5 million loans being borrowed through the so-called subsidized Stafford loans. Except the lower rate would apply only to new borrowers who apply this year. Except that no payments are made until after graduation, so it would not help anyone for several years. Except that it would lower monthly payments by an average of only $7. assure a

If that were not enough the very students who supported Obama on his healthcare plan find now that if they succeed as college graduates the burden of student loan debt will be made worse by the added burden of supplementing Medicare through higher payroll deductions:

The provision, a little-known part of ObamaCare, levies a 3.8 percent Medicare tax on investment income for couples making more than $250,000 or individuals making more than $200,000 a year.

Those citizens will now pay 5.25% (rather than 1.45%) of their wages into medicare in addition to the amount their employer pays.

Millennial are already looking pretty brief future. The economy is sluggish. The cost of living is rising but salaries are not keeping pace. Many college grads are taking jobs that their peers who don’t attend college usually get adding to the problem of high unemployment for this group. Spending by government is high leaving little enthusiasm in the private sector to expand and create jobs. Seniors who would normally retire are choosing to hang on to their jobs. It’s looking very bleak for the newest generation entering adulthood.

So what does the Obama administration do next? Obama doubles down…he believes in his big government solutions and redistribution. His newest proposal is to offer a retirement plan, the “myIRA” plan we highlighted in an article yesterday. This plan offers very little return on investment for the investor but amounts to another vehicle to transfer big chunks of cash to government:

Young people aren’t saving, Obama says, so let’s create a scheme that puts their money into U.S. government bonds! And in his infinite benevolence, Obama will insure the whole scheme so that nobody loses a dime.

This sounds good to the average saver, because he or she has probably been abused by Wall Street. In fact, many people are still looking at IRA and brokerage balances destroyed by the financial crisis.

And the MyRA couldn’t be simpler, as it boasts just one investment choice: a Treasury bond fund stuffed with U.S. Treasury bonds. While account holders allegedly can’t lose money on this investment, I’d argue that they’re likely losing every month as the value of their currency is inflated away. Just look at 2012, when the fund returned a miserly 1.47% and inflation more than doubled that at 3%.

Anyone who invests in Treasury bonds will tell you that they absolutely can lose money. When interest rates go up, the value of an outstanding bond with a lower coupon goes down in value. When interest rates go down, the value of outstanding bonds with a higher coupon go up in value. The only way that you don’t lose is to hold the bond to maturity, and by then you’ve likely lost to inflation.

Young people need real solutions to the problems that are making life miserable and their prospects for the future very dim. The best solution would be dramatic changes in the size and scope of government. Some young people are waking up to the economically destructive consequences that follow big government solutions. These young people are struggling, broke and looking for alternative ideas to offer themselves “a shot”. See also here.

It’s unfortunate that this group has been deceived about policies used by past presidents of both parties have worked to create a growing economy and jobs…an economy that works for all Americans…an atmosphere of opportunity that inspires growth from private investment and creativity. Many people have been taught that supply side economics, “trickle down”, is a greedy scheme to “give more to the rich”. Only a person with little knowledge or personal experience about how a dynamic economy works would fall for this tripe. The young are very vulnerable to this deception. I encourage them to reconsider what they have been taught and to explore the alternative.

See also video here, here, here, and for Californians, here.

he old saying goes, “”If you’re not a liberal at twenty you have no heart, if you’re not a conservative at forty you have no brain.”

Read more: When Churchill said “If you’re not a liberal at twenty you have no heart, if you’re not a conservative at forty you have no brain.” Today’s young, like the WWII generation before them, are facing challenges that require growing to maturity at an early age. We don’t have to stop being charitable to learn the lessons of responsible fiscal policy. The next two elections will decide the fate of so many young people…we must elect those who will give these young men and women a chance at the American Dream.