Source: Your grandparents are bankrupting you Channel: ReasonTV Published: March 30, 2026 | Archived: May 4, 2026

Video: Your grandparents are bankrupting you
Channel: ReasonTV
Published: March 30, 2026
Duration: 18:13
Views: 103,512
Category: News & Politics
Video ID: vXEED-ItEo4

Description

Today’s retirees are the wealthiest cohort of Americans. The median household headed by someone over age 65 is far wealthier than the average household headed by someone in their late 30s.

Despite that, roughly 22 cents of every dollar the federal government spent last year was funneled to retirees via Social Security. Medicare spending accounted for another 14 percent. Many of those dollars were extracted from younger, poorer Americans. (The rest were borrowed and added to the national debt.)

A retired couple today might possess a robust retirement account and own a million-dollar home, but the government still acts as if they live in the poverty-stricken hellscape that O’Neill described. And as the old have gotten wealthier, the taxpayer-funded benefits have only gotten more lavish.

Social Security provides inflation-proof monthly payments, keeping retirees ahead of the curve even as working-age Americans struggle to make ends meet. In many places, seniors are gifted special exemptions from taxes on homes and vehicles that aren’t available to younger Americans. Medicare, created to address seniors’ medical needs, now offers such taxpayer-funded perks as discounted golf course fees, ski resort lift tickets, even pet supplies and pickleball equipment.

In short: Today’s old-age entitlement system is not a last-resort guardrail against poverty and desolation. It is a sprawling, expensive lifestyle-subsidy program that steals from the poor to give to the rich—while also worsening the housing crisis and pushing the country toward a dangerous fiscal cliff.

Producer: Eric Boehm Video editor: Regan McDaniel Graphics: Adani Samat Audio Production: Ian Keyser Color Correction: Cody Huff

Photo Credits: Artvee; Library of Congress; Mark Reinstein/ZUMA Press/Newscom; IMAGO/Jochen Tack/Newscom; Everett Collection/Newscom; Anthony Behar/Sipa USA/Newscom; Andrew Leyden/ZUMAPRESS/Newscom; Michael Siluk/UCG/Universal Images Group/Newscom; Jakub Porzycki/ZUMAPRESS/Newscom; Phil Nijhuis/ANP/Newscom

Music Credits: ElevenLabs; Albatross, Tomorrow by ANBR, “Thoughts,” by ANBR, “Eminence Landscapes,” by Ian Post, “Endless Fields,” by Ian Post, “Premiere,” by Adrián Berenguer, via Artlist. Epic Stock Media, Projector 1960 Bell And Howell Clicking Whirring, John Silke Vintage Toybox Cash Register Draw Open Ring, Dauzkobza Vintage Elements Vinyl Record Scratch Needle Stop, via Artlist.

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Transcript — YouTube panel (English (auto-generated)

) (human-authored)

0:00 This is the Los Serranos Golf and Country Club in Southern California. It’s got two courses to choose from, each with gorgeous views of the San Gabriel Mountains. And I’m not a golfer, but I got to admit, it looks like a pretty great spot to spend a few hours in the California sun and knock back a couple of beers. And if you’re over 65, a resident of California, and enrolled in the right Medicare plan, then you can get taxpayers like me to pick up part of your tab for playing there. And not just there, but at a bunch of other courses around Southern California, too. Maybe skiing is more of your thing. Other Medicare Advantage plans offer taxpayer funded lift tickets at Utah ski resorts.

0:38 Retirees can also get horseback riding lessons, memberships at various health and social clubs, all of it paid for by younger Americans. How is this possible? A better question might be, why isn’t this a national scandal? America is full of policies and programs explicitly designed to benefit older people regardless of how rich or poor they might be. In practice, these things are a massive wealth redistribution scheme that take money from workers and give it to retirees.

1:07 Generally speaking, these programs were created for noble purposes to keep senior citizens from falling into poverty and to help them stay healthy. But somewhere along the way, things got really out of whack. Today’s senior citizens are the wealthiest generation of retirees in American history. They are receiving far more in government benefits than they contributed during their working years. And these policies are worsening a whole bunch of other serious problems from the national debt to the housing shortage. Now, I’ve got nothing against them for being wealthy, and I’m glad that so many retirees today are staying active into their golden years. But why can’t they pay for their own golf outings and ski vacations?

1:52 Every time you get paid, there are payroll taxes deducted from your check. Those dollars are pumped into the federal government’s mighty wealth redistribution machine. And the vast majority of those taxes are plucked from the checks of young workers to be given to older retired Americans, including paying for those tea times. But let’s back up for a minute and look at why this whole system exists. Economist Nicholas Bar says that there are two reasons for a welfare state to exist. As a Robin Hood that takes from the rich and gives to the poor and as a piggy bank that redistributes money across time. The piggy bank approach is meant to deal with a problem that almost everyone faces. We earn basically all of our money from when we’re in our 20s to when we’re in our 70s, but we keep spending until we die. And consumption tends to get higher the longer someone lives. And not everyone saves enough for

2:40 retirement. So, that’s the why, but what about the how? A lot of the talk about welfare is focused on what we think of as the Robin Hood style programs, the ones that are aimed at helping the poor. But overwhelmingly, America’s welfare system is the piggy bank model. Fully 2thirds of America’s redistribution spending goes to people aged 65 and older, most of it via Social Security and Medicare. That’s because nearly 90% of senior citizens get Social Security.

3:06 And it doesn’t matter how rich you are. Even Bill Gates qualifies. workers pay taxes to support both the Robin Hood and piggy bank transfer programs, but in practice, the vast majority of those payments are going to older Americans. Now, this is the part where you can already hear a boomer objecting to the premise of this video. I paid into those programs when I was working and I’m just getting back what I’m owed.

3:29 But is that true? To better understand that dynamic, we have to take a little trip back through time. I think we all have this mental image of the Great Depression as a time when everyone was poor and old people were extra super poor. Tip O’Neal, Speaker of the House on Social Security’s 50th birthday in 1985, summed it up like this. Life for the elderly is filled with uncertainty, dependency, and horror. When you get old, you are without income, without hope. Social Security has made it possible for people not to have to live in fear and dependency.

4:05 Now, there’s some debate about how true that was. There weren’t reliable federal poverty statistics in the 1920s and 1930s, but some states collected that information. In New York, for example, 90% of the elderly were self-supported, meaning that they had sufficient savings or they were supported by friends and family. And that was in 1929, just before the crash. The depression changed that, and we’ve never gone back. This guy, Francis E. Townson, a retired California doctor, was one of the first people to float a national pension plan.

4:37 In 1933, he published an article in his hometown newspaper advocating for the creation of what he called the Townsend Old Age Revolving Pension Plan. It would have been funded by a 2% national sales tax and provide a $200 monthly pension to every citizen over age 60. Other ideas at the time were not so detailed. The popular ham and eggs retirement plan demanded that the government pay $30 every Thursday to all retirees. The pension plan that America ended up with was called social security. It was created in 1935 by Congress and President Franklin D. Roosevelt and modeled on European social insurance programs like one created in Germany in the 1880s. Even today, social security is pretty simple. Workers and employers pay taxes to the government and the government doleS out benefits to retirees. But that simple arrangement leads to this common misconception.

5:29 I paid into social security for decades. That’s my money. Sorry, but no. Workers in the 1930s were taxed to pay for retirees during the Great Depression. And that pattern has continued ever since. Workers in the 1950s were taxed to pay for retirees in the 1950s. Workers in the 1970s were taxed to pay for retirees in the 1970s. and workers today are being taxed to pay for retirees today. You might think that there’s an account somewhere deep in the bowels of the Social Security Administration with your name on it stuffed with dollar bills just waiting for the day that you turn 65. There isn’t. When that money comes out of your paycheck, it goes straight to current beneficiaries. And paying into Social Security when you’re at working age does not come with any guarantee that the program will pay you benefits later on.

6:18 The Supreme Court has ruled on this question twice. It is settled. The operative question here isn’t about who has a right to that money. It’s about how the government should spend it. It is essentially a political question. So, keep that in mind. We’ll come back to it a little bit later. Now, over the years, the old age welfare state has grown and grown and grown. Lynden Johnson signed the Social Security amendments in 1965 that created Medicare and also Medicaid.

6:46 In 1983, President Ronald Reagan signed a bipartisan bill to raise payroll taxes and gradually increase the retirement age from 65 to 67. The Balanced Budget Act of 1997, signed by President Bill Clinton, created a new set of services under Medicare that was Medicare plus Choice, a service that would be rebranded as Medicare Advantage in the early 2000s. This will matter later, too. In 2003, George W. Bush signed legislation that expanded Medicare to cover pharmaceutical drugs. The Affordable Care Act was mostly concerned with expanding Medicaid, the health insurance program for poor Americans, but it also made some changes to Medicare Advantage that increased enrollment. And finally, in 2018, Congress and President Donald Trump loosened the rules for what benefits could be offered by Medicare Advantage plans. That in short is how you end up with taxpayer dollars funding golf outings and ski trips under the guise of

7:42 Medicare spending today. So if you’re mad about that, thank Clinton and Trump. So for decades, America has been expanding and expanding the entitlement state for older people. That might have started with good intentions during a crisis, but it is increasingly difficult to justify. Today, senior citizens are the wealthiest cohort of people in America. The median household headed by someone over age 65 is worth more than twice as much as the median household headed by someone in their late 30s.

8:12 Younger households are even further behind. But thanks to the way these programs operate, it’s people in their 20s and 30s and 40s who are funding benefits to their older, wealthier counterparts. The problem of widespread senior poverty, if it ever really existed outside of the Great Depression, has been solved. But even as older Americans have gotten richer and richer, we’ve cranked up the system of redistributing wealth in their direction, and that seems deeply unfair.

8:44 My friend Russ Green has come up with a clever way to describe this dynamic. He calls it total boomer luxury communism. And Russ is here with us today. Russ, how you doing? I’m good. How you doing? I’m good. I’m good. What is total boomer luxury communism? Total boomer luxury communism is a system of political economy that transfers wealth to uh older people at the expense of younger generations. And it does this through a variety of means.

9:15 Um some of them are entitlement programs at the federal level. Uh some of them are special tax breaks that only senior citizens are eligible for and others uh involve the artificial inflation of home values and uh constrictions on the housing supply. You’re advocating for changing those things for changing the way entitlement programs work for changing some of these other benefits that old people get. Uh doesn’t that mean you’re changing the sort of social contract that these people had been a part of for most of their working lives?

9:49 Yeah. Um the social contract’s already been broken. Uh it was broken years ago when uh politicians in in in DC decided to run up the federal debt to historically high levels. You know, we’re now approaching $39 trillion. Fundamentally, what that means is younger people, even people who are not born yet, are being forced against their will to pay for programs that don’t benefit them. If people want to make an appeal to some sort of moral right they have to government money, um I don’t even think that exists at all. Um but even if it did, it’s already been outweighed by the situation we’re now in with um the state of the federal debt.

10:34 When Social Security was created, Franklin Roosevelt said the goal was to provide some measure of protection to the average citizen and to his family against povertyridden old age. These days, that protection has become a golden parachute for many households. In 2024, the maximum Social Security benefit was nearly $117,000. And remember, all of that money is coming out of the paychecks of current workers so that it can fund the lifestyles of people who are generally speaking wealthier. Instead of a piggy bank, this is a reverse Robin Hood system. We’re taking from the relatively poor and giving to the relatively rich.

11:11 Okay, granted, most people aren’t getting the maximum Social Security payout, but almost all retirees collect more in Social Security and Medicare benefits than what they paid in. That’s true for lower earning households, middle inome households, and wealthier households. Remember our friend, I’m just getting back what I paid in. Sorry, but that’s just not true. That’s not how these programs work.

11:36 That’s not how it works. That’s not how any of this works. Yeah, she gets it. So, it is current workers footing the bill, and the math isn’t mathing. Today’s retirees are collecting more than they contributed. This is largely true for two reasons, both of which have to do with that history of Social Security and Medicare. For one, people live a lot longer today. When Social Security launched in 1935, the average life expectancy for Americans was 61. That means the average person died 4 years before qualifying for benefits. Today, someone who lives to age 65 has a life expectancy of 20 more years. And that’s according to Social Security’s own actuarial tables.

12:14 That’s a lot more years of retirement that this scheme has to cover. And all of that cost falls on current workers who are, I remind you once again, generally much poorer than today’s retirees. But that’s only the beginning of total boomer luxury communism. Remember those golf outings and ski vacations and other perks that were covered by Medicare Advantage? According to research by the Manhattan Institute’s Chris Pope, Medicare Advantage plans also cover hair styling and beauty services and in some cases even pet food. pet toys, kitty litter, and flea shampoo. The Government Accountability Office says that those supplemental benefits cost taxpayers $6.4 billion in 2022, and the price tag has likely grown since then because enrollment in Medicare Advantage is growing. So, we’re taxing working age Americans who are trying to raise a family and save to buy a house so that we can pay for senior

13:08 citizens, pets, shampoo. Something is wrong with this picture. But wait, it gets worse. Social Security and Medicare are the fastest growing portions of the federal budget, and tax collections aren’t keeping up with how much they cost. That means we’re borrowing more every year to fund these programs. And more borrowing likely means higher inflation over the long run. So, in other words, you’re being taxed now to pay for boomers retirement benefits. And then that money you get to keep, it’s worth less because of higher inflation. But wait, wait, it gets worse again. Everybody seems to be talking about affordability these days. And usually that means housing prices, but government benefits for old people aren’t just taking money out of your pocket and making it harder to save up to buy a house. They’re actually making houses more expensive, too. Here’s why.

14:01 In a lot of states and some local jurisdictions, senior citizens get special property tax breaks. Like Social Security and Medicare, those property tax breaks were created with some good intentions. The idea is to make it more affordable for older people to stay in their homes as they age. In reality, these policies have discouraged older Americans from downsizing after their kids have moved out and they’ve retired.

14:24 In a recent survey, nearly 70% of baby boomer homeowners said they were planning to remain in their homes as they got older. As a result, there are fewer houses on the market. And the houses that are available are more pricey. That’s bad news for anyone trying to buy a new home and start a family. This total boomer luxury communism is at the root of a whole bunch of other problems. The debt, the housing crisis, inflation, and so on.

14:49 You want to fix those things? Then we’ve got to fix this. If something cannot go on forever, it will stop. Total boomer luxury communism is no exception and the clock is already ticking. Social Security is running headlong into insolveny, which will hit in the early 2030s. When it does, retirees benefit checks will be cut by about 23% across the board, regardless of need. And that’s a pretty unfair outcome, too. See, here’s something we need to acknowledge. Even though the average retiree gets a lot more in benefits than they paid in taxes, there are some retirees who truly do rely on Social Security and Medicare to get by, these government welfare programs are the only thing keeping some seniors out of poverty. And that means that those coming cuts in the 2030s will be harsh.

15:40 And even though the vast majority of retirees report being financially comfortable in retirement, we can’t forget that there will always be some people who do need the help. Fixing entitlement programs can make sure that the help goes to the people who truly need it without really affecting wealthy retirees who already have plenty saved up. But the main reason to fix this is to stop charging those younger, poorer workers to pay for the luxurious benefits that are paid to wealthier households. So, how do we fix it?

16:07 Politics. Yes, really. Politics. See, we’ve politicized bathrooms and bakeries and almost every nook and cranny of pop culture at this point, but the culture wars have blinded us to the generational war. At the same time that we’ve pushed politics into every corner of our lives, we’ve removed the vast majority of the federal budget from the political process. Social Security and Medicare run on autopilot, and that means they’re not subject to the annual budget debates in Congress, and that means that they’re not a focus of campaigns either.

16:40 That’s got to change. As long as we’re running Social Security and Medicare on autopilot, that means that they get prioritized over everything else because it just keeps running and no one ever has to vote on it. If we stopped doing that, then the trade-offs would be much more apparent and our elected officials in Congress would have to confront this problem. What’s the most effective use of our tax dollars? Is it a stronger military, more industrial policy, more subsidies for young families? Four is it’s sending checks to the wealthiest Americans so they can have another vacation. If Congress had to actually confront that question, it might budget differently. So, we don’t really need generational warfare, but we do need some political conflict over how to solve this problem because that’s how the system works. Or just take a more cynical outlook. Social Security and Medicare are going to be insolvent by

17:30 the early 2030s. And at that point, something is going to have to be done. Have you looked at the average age of Congress lately? doesn’t give me a lot of hope that the interests of younger Americans are going to get a fair shake. Whatever solution they come up with is probably going to protect wealthy older people and screw everyone else. It won’t turn the conveyor belt off. It’ll probably make it run faster, probably by hiking up payroll taxes. The current situation is unfair and that would be worse. Younger Americans need to tell Congress to get serious about entitlement reform and tell wealthy boomers to pay for their own damn ski vacations.