This book addresses the problem of growing government entitlement programs for Americans in light of limited resources for providing them. Yes, everyone should be aware of the funding problems. Mr. Peterson should be thanked for bringing out a book on the subject. The color graphs are quite attractive. The writing is quick and easy to read, but even though he says he is not an alarmist, that's the impression he gives. There are many assumptions which readers usually swallow whole and that's what is wrong with the presentation. The book states that Americans do not "save" enough and that the Japanese save more. It infers that the Japanese are better off. In comparison to the amount Americans have in terms of goods and services, the Japanese have much less to consume. First, Americans as a whole save as much as any people in other industrialized countries. Our saving is not just at the bank, but involves mortgage payments, insurance premiums and employer pensions. Very few people in Japan own or are buying their homes. If we counted ALL savings of Amnericans, it would equal savings of people in other countries. If in fact, greater "saving" is responsible for a growing economy and a higher standard of living, why has Japan with its high saving rate been in a recession for the past seven years? (During the same time period the U.S. economy has been growing more prosperous.) The graph on page 24 shows how many American workers are needed to support each U.S. social security beneficiary for selected years between 1955 and 2040. In 1955 it took 8.6 workers, in 1995 it was 3.3 workers per retiree and by the year 2040 there will be only two workers per beneficiary. (In 1995 workers AND retirees all had more of material goods than in 1955.) This is the same kind of projection that was used years ago when at the turn of the century it took 50 percent of the working population to provide enough food for everyone else in the country. Everyone thought it was an ominous sign that so many young people were leaving the farms and that there was sure to be shortages of food unless the trend was stopped. Well, by the 1930's we had food surpluses which continued right through the 1980's even though only two percent of the working population is in farming. Even now, if we did not sell our surplus farm products overseas, we would have surpluses. In the U.S. today it takes one average farmer to produce enough food to feed 90 people. Only a few decades ago it would have seemed impossible. Its not obvious what method was used to get the numbers on the federal government's "red ink" chart on page 18, but just recently a review of the federal government's report for 1995 indicated that the accumulated federal debt of approximately $20,000 (liability) per U.S. population is compared to $205,000 of public assets per U.S. population. There are very few organizations of any kind that have such a favorable balance. Yes, there should be more reliance on private funds for medical care for the elderly and also some level of means test. But also keep in mind that spending on medical care causes people to live longer and people living longer results in more spending on health care. If old people had to pay for life-lengthening medications, they might not spend as much and health care companies would not have the profits to fund more advanced products to keep more people living longer. Think of the implications--investments, employment, life spans, etc Out of the complications we see that with or without government involvement, the industries that grow and prosper are the ones that get funded, either privately or by government. Each area of decision-making is made up of lots of individual choices which together move mountains. We agree that no one should have the idea that people should rely on social security benefits to fund their retirements. As far as the past is concerned, people with ONLY social security have NOT lived real high. Mr. Peterson is right when he says that young people do NOT expect to live on social security benefits when they retire. And, so, THAT finding may be the solution yet.

I have read this book and it scares me to death. People my age must realize that doing nothing is tantamount to giving our futures away. We must come to terms with the fact that there are 76 million Baby Boomers approaching retirement age, and there is no national plan to accomodate their pension and health needs. And to complicate matters, the problem is already occurring elsewhere around the world. Just read Peter Peterson's newest book, Gray Dawn.

This book is chock-full of speciousnonsense,employingsuperficial and misleading use of statistics,worst-case scenarios, and outright horror stories more designed to frighten and divide different elements of the American electorate for crass conservative political purposes than it is an objective and useful text about the subject at hand. What neo-conservative apologist Mr. Pete Petersen and the think-tank (isn't that an absolute oxymoron?) he's associated with doesn't want you to know is that our heroes in the U.S. Congress have been systematically frittering away the 'surplus' money all we aging soon-to-be-seniors have been contributing since the late 1960s in order to hide their own profligate and irresponsible spending agendas like STAR WARS and the new missile defense system that can't tell a warhead from a drone. Hey, guys! Have a bake-sale instead.

In essence, the only reason social security is potentially underfunded in the long-term is because of their ( ), waste, and abuse. A small corrective action taken now by Congress can correct an imbalance. Yeah, I know, congressional action is another oxymoron, but a fellow has to have some hope. Hey! Why don't we curtail the Congress's retirement program instead? Not in this life. More seriously, Mr Petersen uses the worst possible case scenario to build his case, assuming all seniors will stop working, that the economy will not contiue to grow, and ignoring the fact that all the money given to seniors by way of social security and medicare go back into the economy and is not "lost" at all, any more than money spent on defense or agriculture by the Congress is lost. Only in Mr. Petersen's neighborhood.

The bottom line in all this is that there are obviously a number of much better, clearer, and smarter books that make much more sense about the prospects associated with the aging babyboomer population as well as covering the welter of issues associated with the long-term social, economic, and political impacts one can reasonably associate with a gradually aging population. Try "America The Wise" by Theodore Roszak out instead, and consign this gloomy, silly, superficial and self-serving piece of neo-conservative political ( ) for the dustbin of history, where it rightly belongs. END

This isn't an exceptionally good book for a number of reasons that aren't really being euclidated in the other reviews.

First, whoever reads this obviously has to realize that the author was a partner at an investment bank AND leans conservatively. These two points DO give liberals reason to question where his heart lies; to discount the whole of the book for that reason hints that readers aren't being open minded and fair. And before you write this review off as bad, note that I gave it two stars too....

Peterson tries in this book to make a point-- that due to what in techincal terms are called Phase-III demographic shifts (i.e. birth rate falls, death rate falls, a higher percentage of the population reaches the retirement age...) the means of entitlement that have become traditional don't work as simply any more. In his other book ('The greying...') he makes the case for the United States; in this one he focuses on Western Europe.

His evidence as presented is valid. There is no lock-box; paying for my retirement (I'm 22 right now...) with the wages of my children will be impossible without significant structural changes in the system. (Personally, I think that paying for it with the stock market is pretty bad karma too.... but that's neither here nor there for this review....) European countries and Japan are due to be hit doubly hard because of their traditionally-greater entitlements and the specifics of their demographies.... most economists would agree on these points....

And his solutions are good-- given that people have the ability to save (assuming that people reliant on Social Security do.... not other rich people... like the author...) and that people are willing to work. His solutions aren't biased so much by his position excepting the possibility that he may not realize that for lots of people, saving is an impossibility.... working longer in years is more or less a definate....

But these aren't really earth-shattering ideas. Adding to this, I find his writing style annoying. More so than this, I find reviewers who have slammed this book as being bad just based on it being written by an I.Banker annoying.

Think! And.... by a book on this pheonomenon by a better economist.... who doesn't try to dumb down the information....

Pete Peterson has written several books on the looming bankruptcy of the Social Security system. In this book, he covers the G-7 nations, which are in worse shape than the United States is.

On page 72, he makes a point that I should have seen sometime over the last 41 years, when I first began looking into this problem. An unfunded liability must be amortized, just like a home mortgage. As of 1999, the unfunded liability of Social Secutrity was $10 trillion. The unfunded liability of Medicare was also $10 trillion. The yearly amortization payment that the U.S. government must set aside each year to fund these two programs over the next 30 years at 6% interest is $1.4 trillion per year. You can verify this on any amortization calculator on the Web. Just take off 9 zeroes when you enter 20,000, and stick them back on when you derive the yearly amortization figure.

The estimated U.S. government budget for fiscal 2000 is $2 trillion. This means that, in order to fund these two off-budget programs, the government must spend 75% of its budget.

Peterson might also have made this point: If (if!!!!) the government does not do this, then this year's $1.4 trillion shortfall must be added to the total unfunded liability. And if the government refuses to fund next year's amortization schedule, it will add another $1.5 trillion. And so on, until.... "Sorry, gramps: no more payments to you." I'm age 58. That's me.

The Federal Reserve System will create the money, thereby creating mass inflation, or else Congress will move up the retirement age, year by year, stiffing the geezers. The government-guaranteed retirement myth will end.

The book shows that Japan will hit the actuarial brick wall in 2003. Italy will hit it in 2005. The G-7 dominoes will topple.

This is a great book. When the chairman of the Council on Foreign Relations says a crisis is looming, you had better believe it.