This paper discusses the politics of ageing in the US within a political economy framework. Four forces are shaping US policy: austerity, federalism, deregulation, and the medical-industrial complex. Two major trends in the development of policy are the commodification of the aged and their needs and a class basis for the distribution of benefits, differentiating the deserving elderly from the undeserving elderly. Ideologies of individualism, self-help, privatisation, and procompetition are being used to delegitimate public programmes and to reduce expectations about what government can and should do to ameliorate social problems.
Recent policy is characterised not only by a reduction of federal funds for domestic social spending, but also a restructuring of the community care delivery system as it operates in the private, non-profit sector of the economy. The emergent processes of this restructuring, e.g., targeting of services based on ability to pay and individual characteristics, medicalisation, and absorption of non-profit agencies by for-profits are discussed. These policies and the consequences that flow from them are viewed in light of the search for new sources of capital investment in the domestic markets. This analysis raises important political questions concerning the transformation of relations between the state and the non-profit sector.