Sometimes, the problems you see coming a long way off are the hardest to solve.
Everybody knows the baby boomers are retiring: a hundred a day, nationally, for the next decade and a half. We’ve known that was coming for, oh, about half a century. Yet, faced with the implications for such a shift from workers to retirees, our elected officials have done next to nothing, especially of late.
Less well-known is that retirees aren’t the only cohort growing rapidly. It’s happening at the other end of the spectrum, too, among school-age children. And these trends are happening faster in Georgia than just about any other state.
Together, these groups make up what demographers and economists call the “age dependent,” who collectively consume more in spending each year than they pay in taxes. As of the 2010 census, there were about 12 youths or seniors for every 20 working-age people in Georgia. But from then to 2030, our population growth is projected to be the opposite: 20 new youths or seniors for every 12 of working age.
The result is Georgia’s “age dependency ratio” will grow to 73 percent from 57 percent in just 20 years. That’s like losing one of every five taxpaying workers.
It might not be as bad if our state budget weren’t already trending this way. K-12 and higher education consumed 40 percent of state spending (including federal funds) in 2000; by 2014, it was up to 43 percent.
Then there’s Medicaid, whose funds go disproportionately to the elderly (according to national estimates, the cost per elderly enrollee is about the same as for a family of five). Its share of Georgia’s total budget has grown to 22 percent of the budget from 14 percent.
So those three programs together went from roughly half of our budget to roughly two-thirds before this trend was really under way. Our legislators are fond of saying bills and programs are “for the children.” Add “and their grandparents,” and that’d cover the vast majority of what the state pays for.
Then recall that almost one-third of our state spending comes from Washington, which is now $19 trillion in debt and facing tens of trillions more in unfunded liabilities, thanks to its inaction.
“Make your plans accordingly,” warns Matthew Ladner, who studies this “intersection of education and aging” for the Foundation for Excellence in Education.
It is still possible to plan for these changes. “Get these kids as well-educated as possible,” Ladner advises. “The best-case scenario is to grow and innovate your way out of it.”
But we won’t get there by doing education as we’ve been doing it. While not as bad as some other states, Georgia hasn’t escaped the national trend of hiring non-teaching staff faster than teachers, who in turn have been added at a faster clip than student enrollment growth.
And while Georgia’s students have improved their test scores, we have a long way before our kids perform like those in the states and countries we must compete against.
“You have to accelerate the rate of improvement,” Ladner says, recalling the saying that a mind is a terrible thing to waste. “It’s always been true, (but) the price of failure is going up.”
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