I agree with a lot of what has been said on this thread, but I will add a few more thoughts.
I think the situation is a lot more complicated that some people seem to think it is. Yes there is a shortage of RN's in the active workforce, but there probably would not be a shortage if every RN were actually working full time in nursing. However, I don't think that simply raising the pay would completely solve the situation -- though I would be happy to receive a raise, myself.
I think a lot of it has to do with the fact that certain aspects of nursing (even under decent conditions) are not appealing to a lot of people. Hospitals need to stay open on nights, weekends, and holidays -- and most people simply don't want to work at those hours. Also, nursing involves dealing with things that smell bad, etc. and with people who are under stress, etc. Then, on top of all of that is all the financial mess of HMO's, managed care, etc. that others have mentioned.
Finally, there are the sociological issues. Most nurses are women -- women with families who would rather NOT work full time if they had the choice. Most young nurses do NOT really intend to work full time as a bedside nurse until they retire at age 68 -- and most older nurses never intended to do that either.
The truth is, most people enter the profession with the underlying expectation that they will do it for a few years, then either move on to some other job in health care OR switch to part time after they have children OR stop working after marriage and live off their husband's salary. The number who really intend to work at the bedside full time for 40+ years is small. As pay increases, it simply allows nurses to satisfy their financial needs with fewer hours of work. Not that I blame them ... If I suddenly won the lottery -- or had a husband with a health paycheck, I would not be working full time, either.
Also, as the acuity rises and the needs for highly educated nurses with advanced skills grows, we need more nurses per patient. One RN, with the help of an LPN and an aid, used to be able to provide safe care for 20 patients on a general med-surg unit. No one would think that was safe with today's level of acuity.
So ... the need for nurses grows; the stress increases because of higher acuity and a more restrictive financial environment; women have other, more attractive career options than they had in the past; and most women NOT to work full time or unattractive shifts if they don't have to. When you add all of that up, it's not surprising that we have a shortage -- and there is no easy solution.