Prepared for 1989-90 Lecture Seminar Series, The Economics of

The Institute's Discussion Paper Series is designed to describe and to elicit comments on work in progress. Papers in the series should be considered working drafts. The economic circumstances of most of the elderly in our society have improved greatly in the past thirty years, owing largely to government programs such as Social Security, Medicare, and Supplemental Security Income. At the same time, the circumstances of many children have worsened for a number of reasons. Children are more likely than they were in the past to live in single-parent homes. Child poverty has risen because children depend on the earnings of their parents for support, and real median earnings have declined. Furthermore social programs for children, from education to Aid to Families with Dependent Children, are increasingly inadequate to serve the young. Because the failure to invest sufficient resources in the human capital of our children will have grave repercussions for both individuals and society, two ideas are advanced that, along with innovations in education and child care, should improve the life chances of future generations. These are a health insurance program to provide specific needed services to all children and a program to enable youth to borrow from the Social Security Trust Funds to finance their education and training. Is There Economic Discrimination against Children? Since Samuel Preston raised the issue in his 1984 presidentia