BOSTON – The Bible enjoins us to do better unto our children than we would do unto ourselves: “From generation to generation.” But, in much of the developed world, we have foresworn that sacred pledge. For six decades, the watchword of our economic faith has been quite different: “Taketh from the young and giveth to the old.”

We have minded our words carefully in describing this moral transgression, lest we provide a clear record of our fiscal child abuse. Our debts are clothed primarily in benign-sounding language like “pension benefits” and “health-care benefits,” not official IOUs.

By calling what’s being taken from the young “taxes,” rather than “borrowing” – that is, a promise to repay far more than what’s being taken – the implicit debts have been intentionally kept off the books.

The United States is not alone in doing this, but its refusal to acknowledge the true magnitude of its old-age liabilities has left it facing perhaps the worst impending fiscal crisis of all the advanced countries. Today, the US is staring at a present-value fiscal gap (present value of projected non-interest spending, minus taxes) of $202 trillion.

The fiscal gap is the only legitimate measure of the condition of a nation’s public finances because it treats “official” and “unofficial” liabilities on the same basis. In addition, it doesn’t ignore the positive – the current and future taxes available to cover these liabilities.

America’s colossal fiscal gap – readily calculated using projections by the Congressional Budget Office – is close to 1,400% of GDP and dwarfs US official debt, which totals $9 trillion (60% of GDP). In comparison, Greece’s fiscal gap is roughly 1,100% of its GDP, whereas its official debt is 120% of GDP.

Nevertheless, the US is able to borrow at dramatically lower interest rates than Greece can. This is not, however, a testament to the dollar’s role as a reserve currency – after all, the fiscal gap is a bill that needs to be paid, and creditors would regard any attempt by the US to devalue the repayment by printing money and stoking inflation as tantamount to default. Instead, America’s favorable borrowing terms attest to the power of misleading government accounting.

This, of course, has profound consequences for the economics of aging – and, again, it is not a uniquely American phenomenon. Throughout the world, standards for reporting national-accounts statistics focus attention on a linguistic construct, official debt, rather than on the economically meaningful infinite-horizon fiscal gap, where pension and health-care liabilities exact a heavy toll. Had Shakespeare said, “First, shoot the accountants,” the world might have realized the amazing damage they can do.

In the US, once Wall Street wakes up to the country’s impending insolvency, interest rates will skyrocket. And that date is close at hand. Even the official debt numbers are starting to record the magnitude of what’s coming. Indeed, by 2017, just six years from now, official US debt will exceed 90% of GDP – the value that Carmen Reinhart, Kenneth Rogoff, and other prominent economists believe is an historical indicator of insolvency.

But the true measure of US insolvency is evident from the adjustments needed to reduce the country’s fiscal gap to zero. If the adjustment were made through taxes, every federal tax would need to be increased by 64%, immediately and permanently; if made through austerity, every non-interest spending program – including Social Security and Medicare, the main entitlement programs for the elderly – would need to be cut, immediately and permanently, by 40%.

No politician has publicly stated that US solvency requires such draconian adjustments, because the American public is far from agreeing to the sacrifice needed. On the other hand, there is a growing sense that America’s current economic malaise – high unemployment and real-wage stagnation for low- and middle-skilled workers – stems from out-of-control fiscal policy, which has been taking ever larger amounts of resources from young savers and giving them to old spenders.

As a result, net domestic investment has suffered a long-term decline. In 1965, the US national saving rate and net domestic investment rate were 15.7% and 14%, respectively. Last year, the national saving rate was 0.1% and the investment rate was 4.4%. So the US is now saving nothing and investing next to nothing. Were it not for its current-account deficit (which records capital imports from abroad), the US would also be investing nothing.

The drop in the saving rate can be readily traced to a massive increase in the rate of household consumption. And, within the household sector, consumption has risen the most among the elderly. Indeed, since 1970, the typical 70-year-old’s consumption appears to have tripled relative to that of the typical 30-year-old.

The US is not alone in running generational Ponzi schemes. Nor is it alone in ignoring the terrible solvency threat they pose and their damaging consequences to saving and investment. All major non-US developed countries – Japan, Germany, France, the United Kingdom, Spain, and Italy – are facing long-term fiscal crises, though each has managed to exercise much better control of its health-care spending, and has taken or is taking major steps to contain other spending.

Unless these countries do more to encourage saving, however, the big threat is that their fiscal crises will culminate in a global financial meltdown far surpassing the crisis in 2008. This may sound like a worst-case scenario, but in my view it is the most likely one: woe unto our children – and our parents.