A family moves into a big, expensive house that Mom and Dad couldn't resist. It's soon obvious, though, that after groceries, utilities, gasoline and other necessities, there's not nearly enough money left to pay the monthly mortgage.

Should Mom and Dad send their kids out to get jobs to pay for the loan? Well, they could. But the better answer is for the family to wake up, admit it's overextended and move to a more modest house with a lower, affordable mortgage.

This is what we as a nation must do. We have to admit we've overextended ourselves with the generous federal entitlement programs for retirement - Medicare, Social Security and Medicaid - and recklessly overcommitted our children to pay for them. We have to seek fair, reasonable ways out.

I got that message loud and clear recently at a town hall meeting at Drake University in Des Moines, where I helped present some very inconvenient truths. Baby boomers like me essentially have voted ourselves gold-plated retirement benefits that aren't paid for. The result is trillions in debt for future generations to pay off.

In Des Moines, I heard audience members say they're ready to talk about tough choices to prevent the catastrophic wave of spending from drowning future generations in bills they can't afford. And I heard them say they expect the president and Congress to consider and make those decisions in a bipartisan way.

So it's encouraging that President Bush's proposed budget takes a serious first run at tackling Medicare's huge unfunded obligations. His plan, if implemented, would steer the nation onto a more responsible course and slow runaway Medicare spending by requiring well-off retirees gradually to pay more realistic premiums for prescription drugs and doctor visits.

Through this and other steps, the president would reduce the Medicare tab charged to our kids and grandkids by an estimated $8 trillion - one-quarter of the $32 trillion projected funding gap.

Under the president's plan, retirees with an annual income of at least $80,000 (or $160,000 per couple) wouldn't be allowed, in effect, to charge 75 percent of their drug costs and have the pharmacy bill their kids and grandkids. He proposes that these wealthier retirees pay a bit more than the 25 percent of the cost.

Some skeptics call this unfair to seniors, as if Bill Gates needs his drug subsidy.

The Des Moines meeting was one of 18 stops over the past year in a "Fiscal Wake-Up Tour" organized by the Concord Coalition. Our touring group includes U.S. Comptroller General David Walker as well as representatives of Brookings Institution and The Heritage Foundation. We span the policy landscape and often disagree on exactly what should be done. But we agree on the problem and the options.

Anticipating success in balancing the budget in five years, which grabs so much attention nowadays, is like planning for a beach party while ignoring the tsunami on the horizon. That tsunami is the surge of entitlement spending as more of the 77 million baby boomers retire. By 2050, this spending will eat up all revenues - forget about paying for defense, homeland security and other services - unless we sharply raise federal taxes from their historical level of just over 18 percent of Gross Domestic Product.

Some are tempted, but we can't simply enact huge tax increases. Federal taxes already are projected to climb to the highest-ever mark as a percentage of GDP over the next 15 years. Raising taxes even faster risks slowing economic growth.

We've got to look hard instead at the promises we made to ourselves and make prudent and reasonable changes. I sense that more and more Americans are ready to tell that to their elected representatives - and to the men and women who would be president.

Stuart M. Butler, Ph.D., is Vice President for Domestic and Economic Policy Studies, and Henry Aaron is a Senior Fellow at the Brookings Institution.