Aging policies, entitlements, and the deficit

Regardless of the good intentions of the Clinton Administration, there will not be enough money now, or in the foreseeable future, to expand entitlements adequately and fund domestic programs on the scale desired to meet all, or even most, needs in health, in housing, in crime control, in welfare, in employment, and in community-based care. This article examines the source of the problem--the nonmarket economy. There are three strategies on which societies have historically relied to fill unmet needs: market incentives, psychological incentives, and coercion. A fourth strategy, local, tax-exempt currency--called service credits, or Time Dollars--which combines market incentives and psychological rewards is described. The article summarizes what we know about why Time Dollars work. The article recommends that the Clinton Administration use already mandated and earmarked funds to undertake systematic experimentation with this currency, using elders to help with the problems of long-term care and neglected, abandoned, and abused children.