Financial Help: Millennials Versus Baby Boomers
July 29th, 2010 · No Comments · Economics, Finance, Politics
American society -- and perhaps that of the entire Western world -- is going to have to make a choice now that the battle cry of Generation Y is starting to sound:
They are perhaps the best-educated generation ever, but they can’t find jobs. Many face staggering college loans and have moved back in with their parents. Even worse, their difficulty in getting careers launched could set them back financially for years....
Among 18-to 29-year-olds, unemployment is the highest it’s been in more than three decades, according to a recent report from Pew Research Center. The report also found that Millennials, also known as Generation Y, are less likely to be employed than Gen Xers or baby boomers were at the same age.
Millennials are generally well-educated, but they have have been cast as everything from tech savants who will work cheap to entitled narcissists. The recession has pitted these younger workers against baby boomers trying to save for retirement and Gen Xers with homes and families. [emphasis added]
As I wrote in a prior post on how governments (ideally) determine public policy, societies frequently need to choose between two competing priorities. The financial meltdown -- with its accompanying unemployment -- is a perfect example.
The Baby Boomers worked for their entire lives and paid into retirement accounts and Social Security with the (reasonable) expectation that they would be able to retire comfortably. However, the burst of the housing bubble and the resulting financial crisis demolished many of their investments. So many are choosing to continue to work rather than retire. The motivation is just as understandable as it is unfortunate.
Generation Y -- and to a lesser extent, Generation X -- got good grades, went to college, took out thousands upon thousands of dollars in student loans, got graduate degrees for even more debt with the (again, reasonable) expectation that they would receive decent jobs that would lead to a comfortable life. However, the financial meltdown has demolished their dreams as well.
Both the old and the young are competing for jobs -- any job -- at a time when they are extremely scarce. There is always a greater supply of labor than demand in any free market, and the unemployment rate is even higher today -- especially when one counts the underemployed, those who have stopped looking, and those who no longer receive unemployment benefits.
There are two competing groups of people who are looking for work. Which priority is more important? Those who worked their entire lives with an expectation that disappeared, or those who made decisions based on societal suggestions that turned out to be wrong? On what should society focus.
Now, as someone who supports capitalism and the free market, I would never argue that the government should dictate one or the other. (Though, the government can nudge societies through economic means including subsidies, tax breaks, and so on.) U.S. society, through the choices of individuals, will make the ultimate decision.
I will be the first to admit that I am biased since I am nearly thirty (and thereby a part of both Generations X and Y), but just as economics determines that women are more valuable than men in the dating market, so should young people be preferred over the old.
The Baby Boomers have a few decades left to live, and only a portion if that will be able to spent in productive work. An impoverished, disillusioned generation of young people, on the other hand, will harm the United States for many, many decades. Parents always sacrifice for their children -- well, now it is time for the parental generation to step aside.
The Baby Boomers have collective responsibility for the damage that their generation has done through Reaganomics; hippie-inspired "free love" and extreme feminism; a series of mistaken, costly, foreign wars; two presidents who could control neither their libidos nor their daddy issues; and the excessive greed that resulted in the near-collapse of the financial system. It will be up to Generation X and Y to repair the damage. The questions is whether Boomers -- known, perhaps unfairly, as the Selfish Generation -- will let us do that.
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Written by: Samuel J. Scott on 29 July 2010.
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7/29/2010
Financial Help Generation Y | Financial Advice Generation Y | Considerations
via samueljscott.com
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