Tag: Boomers

AND THE BAND PLAYED ON

A confluence of events last week has me reminiscing about the days gone by and apprehensive about the future. I’ve spent a substantial portion of my adulthood rushing to baseball fields, hockey rinks, gymnasiums, and school auditoriums after a long day at work. I’d be lying if I said I enjoyed every moment. Watching eight year olds trying to throw a strike for two hours can become excruciatingly mind-numbing. But, the years of baseball, hockey, basketball, and band taught my boys life lessons about teamwork, sportsmanship, winning, losing, hard work, and having fun. There were championship teams, awful teams and of course trophies for finishing in 7th place. As my boys have gotten older and no longer participate in organized sports, the time commitment has dropped considerably. Last week was one of those few occasions where I had to rush home from work, wolf down a slice of pizza and head out to a school function. It was the annual 8th grade Spring concert.

My youngest son was one of a hundred kids in the 8th grade choir. I think it was mandatory, since none of my kids like to sing. As my wife and I found a seat in the back of the auditorium where we could make a quick escape at the conclusion of the show, neither of us were enthused with the prospect of spending the next ninety minutes listening to off-key music and lame songs. I’ve been jaded by sitting through these ordeals since pre-school. But a funny thing happened during my 30th band concert. I began to feel sentimental about the past and sorrowful about the future for these Millennials.

The Millennial generation was born between 1982 and 2004. Therefore, they range in age from 9 years old to 31 years old. There are approximately 87 million of them, or 27.5% of the U.S. population. In comparison, the much ballyhooed Boomer generation only has 65 million cohorts remaining on this earth. The Millennials will have a much greater influence on the direction of this country over the next fifteen years than the currently in control Boomers. There has been abundant scorn heaped upon this young generation by their elders. In a fit of irrationality befit the arrogant, hubristic, delusional elder generations, they somehow blame a cohort in which 54 million of them are still younger than 21 years old for many of the ills afflicting our society. This disgusting display of hubris is par for the course among these delusional elders.

Are Millennials addicted to their iGadgets, cell phones and Facebook pages? Probably. Do they spend too much time on the internet and playing PS3 & Xbox? Certainly. Have they been indoctrinated in social engineering gibberish like diversity and planet worship by government run public school bureaucrats? Absolutely. Are they young, foolish, immature, irrational and not respectful towards their elders? You betcha. Teenagers have acted like this forever. You acted like that. The ongoing crisis in this country and our unsustainable economic system are in no way the result of anything perpetrated by the Millennial generation.

Can the Millennial generation be blamed for the $17 trillion national debt, $222 trillion of unfunded un-payable social obligations promised by corrupt politicians, $1 trillion of annual deficits, undeclared wars being waged across the globe on behalf of the military industrial complex arms dealer mega-corporations, economic policies that have resulted in 48 million people dependent on food stamps, tax policies that enrich those who write the code, trade policies that benefit corporations who gutted the industrial base and shipped jobs overseas to slave labor factories, or monetary policies that have destroyed 96% of the dollar’s purchasing power? They had no say in the creation of our untenable welfare/warfare state.

There are no Millennials among the 535 corrupt bought off politicians slithering down the halls of Congress. There are no Millennials running the Too Big To Control Wall Street banks. There are no Millennials in charge of the mega-corporations that buy and sell our politicians. There are no Millennials at the upper echelon of the Military Industrial Complex or in the upper ranks of the U.S. Military. But, and this is a big but, they have done most of the dying in the Middle East over the last ten years in our multiple undeclared preemptive wars of aggression. They have died under the false pretenses of a War on Terror, when they are truly dying on behalf of the crony capitalists who profit from never ending war. They have been fighting and dying to protect “our oil” that happens to be under “their sand”. If the energy independence storyline was true, why is our military perpetually at war in the Middle East?

The Millennials will also be required to do the heavy lifting over the next fifteen years of this Fourth Turning Crisis. The Silent Generation is dying off rapidly. The Boomer generation has done some hard living and some hefty eating and with the oldest of their cohort hitting 70 years old, their supremacy will begin to diminish over the coming fifteen years. At 87 million strong, and millions yet to reach voting age, the Millennials will become more influential by the day regarding the future course of this nation. The question is what will be left of this country by the time they assume control. They are saddled with $1 trillion of student loan debt, peddled to them by the government and Wall Street with the false promise of good paying jobs and the opportunity for a better life than their parents lived. They have obediently followed the path laid out by their elders, but they have been badly misled. This American dream has been shattered upon an iceberg of debt, delusion, deception and denial. The unsinkable American empire’s hubris and arrogance are leading to its demise. The Millennials are coming of age during a Crisis that will reach momentous magnitudes over the next fifteen years, and they had nothing to do with creating the circumstances which will propel the chaos and anarchy that ensues. But, they will bear the brunt of the dreadful consequences.

Generational Bridge

“The Boomers’ old age will loom, exposing the thinness in private savings and the unsustainability of public promises. The 13ers will reach their make or break peak earning years, realizing at last that they can’t all be lucky exceptions to their stagnating average income. Millennials will come of age facing debts, tax burdens, and two tier wage structures that older generations will now declare intolerable.” – Strauss & Howe – The Fourth Turning

The kids on the stage at the 8th grade Spring concert were all around 14 years old. They are unaware they are in the midst of a twenty year period of Crisis. The boys are at that gawky looking stage with pimply faces and gawky limbs. The girls mature quicker than the boys at that age. These youngsters have barely begun their lives. I was amazed at their proficiency with a wide variety of musical instruments. They displayed poise and talent. The soloists exhibited composure well beyond their years. The performers were all musically endowed and proved that hard work and practice pays off. They were clearly enjoying themselves. They were all dressed in their Sunday best. I found myself enjoying the show despite my jaded attitude upon entering the auditorium. Even my son, wearing one of my ties, actually appeared to be singing during the choir performance. What I saw were hundreds of bright eyed Millennials with their hopes and dreams for a bright future intact. They have no idea what trials and tribulations await them.

I reached a milestone on the age chart last week that had me ruminating about yesteryear and contemplating the future. I reached the half century mark. Birthdays generally do not faze me, but the intersection of the 8th grade concert and my landmark birthday had me pondering my purpose for inhabiting this world. I’ve likely realized two-thirds of my life. The final third of my life will be spent trying to maneuver through the minefields of this Fourth Turning. I’m a father to three Millennial boys. I consider it my duty to defend and support them during this Crisis. Strauss & Howe wrote their book in 1997 and predicted a Great Devaluation in the financial markets around the time Millennials were entering their twenties. This Crisis began in September 2008 with the worldwide financial collapse created by Wall Street “Greed is Good” Boomers, as the oldest Millennials entered their twenties. It continues to worsen as more Millennials approach their twenties. We’ve reached a point in history when the elder generations need to sacrifice in order to insure younger generations have a chance at some form of the American dream.

I believe each generation has an obligation to future generations. We are bridge between preceding generations and future generations. We have a civic obligation to manage the resources of the country in a prudent manner. It’s our duty to leave the country in a financially viable condition so younger generations have an opportunity to live a better life than their parents. Every generation that preceded the Millennials has achieved the goal of having a better standard of living than their parents. I don’t believe my boys will enjoy a better life than I’ve lived. We’ve lived well beyond our means for decades. Government, Wall Street banks, corporations and individuals have run up a $56 trillion tab and are sticking the Millennials with the bill.

The $17 trillion national debt accumulated by elder generations to benefit themselves and $222 trillion of unfunded entitlements promised to themselves is nothing but generational theft. It’s immoral and possibly the most selfish act in human history. I’m ashamed that my generation and older generations have committed this criminal act of theft. Deficit spending today with no intention of repaying that debt is a tax on future generations. This egotistical abuse of power by the current and past regimes must be reversed voluntarily or it will be done by force. I’m 50 years old and will dedicating my remaining time on this earth fighting to create a sustainable future for my kids and their kids. The lucky among us get eighty years on this planet to make a difference. When did the definition of success become dying with the most toys and spending your life screwing your fellow man by accumulating obscene levels of wealth at their expense? If Boomers and Generation X have any sense of guilt about what they have done, they would be willingly offering to sacrifice their ill-gotten entitlements.

Not only are those currently in power not proposing to scale back their spending, debt accumulation, or entitlement transfers, but they have accelerated the pace of each in the last five years. An already unsustainable corrupted economic structure is being driven towards collapse by psychopathic central bankers and cowardly captured politicians. These are acts of treason against the youth of this country and larceny on a grand scale. It will lead to generational warfare and these crooks will pay for their transgressions. Strauss & Howe suspected in 1997 the elders might cling to their illicit profits acquired at the expense of the Millennials:

“When young adults encounter leaders who cling to the old regime (and who keep propping up senior benefit programs that will by then be busting the budget), they will not tune out, 13er – style. Instead, they will get busy working to defeat or overcome their adversaries. Their success will lead some older critics to perceive real danger in a rising generation perceived as capable but naïve.” – Strauss & Howe – The Fourth Turning

The elders who represent the status quo do perceive real danger in the rising Millennial generation. The initial skirmishes occurred in the midst of the Occupy protests. The young protestors initially focused on the true culprits in the crashing of the financial system and vaporizing of the net worth of millions – Wall Street bankers and their sugar daddy at the Federal Reserve. In a display of status quo bipartisanship you had liberal Democrat mayors in cities across the country call out their armed thugs to beat the millennial protestors into submission while being cheered on by Fox News and the neo-cons.

The existing status quo regime provides the illusion of choice, but both political parties are interchangeable in their desire to control our lives, flex our military might around the globe, indebt future generations and write laws to favor their corporate and banking masters. The establishment is showing contempt for the futures of our youth. Their solutions to the criminally created financial crisis have been to reward reckless debtors and bankers at the expense of future generations. Their doling out of hundreds of billions in student loan debt and artificial propping up of home prices has effectively made it impossible for millions of young people to get their lives started. Boomers have done such a poor job saving for their retirements they are unable to leave the workforce. Since January 2009, despite adding $400 billion of student loan debt, Millennials have a net loss in jobs, while the Boomers have taken 4 million jobs.

Strauss & Howe anticipated that older people would be anguished to see good kids suffer for the mistakes they had made. They thought the elders couldn’t possibly be shallow enough, selfish enough, or immoral enough to deny the Millennial generation a chance at the American Dream. They were wrong. The old regime has no plans to step aside or sacrifice on behalf of younger generations. The implications of this resistance will be dire.   

“The youthful hunger for social discipline and centralized authority could lead Millennial youth brigades to lend mass to dangerous demagogues. The risk of class warfare will be especially grave if the 20% of Millennials who were poor as children (50% in inner cities) come of age seeing their peer-bonded paths to generational progress blocked by elder inertia.” – Strauss & Howe – The Fourth Turning

The social mood in this country continues to deteriorate as the sociopathic financial elite accelerate their pillaging of the working middle class, steal money from senior citizens through zero interest rate inflationary policies, and enslave our youth in the chains of crushing debt and promise of dead end jobs. When the next leg down in this ongoing depression strikes like an F5 tornado, the simmering anger in this country will explode in a chaotic frenzy of violence and retribution. The chances of class and generational warfare have increased exponentially due to the actions of the elderly regime over the last five years.

Generational Sacrifice

“You got your whole life ahead of you, but for me, I finish things.” – Walt Kowalski – Gran Torino   

  

A couple days after the Spring concert I was flipping through the 650 channels on my TV with nothing worth watching when I stumbled across the 2008 Clint Eastwood movie Gran Torino. This was the third episode within the week that had me thinking about the future of my kids. It was his highest grossing film in history. Eastwood played a bigoted tough guy Korean War veteran whose Detroit suburban neighborhood had deteriorated into a dangerous gang infested Asian war zone. The movie did not follow the standard Eastwood plot where he kills dozens of bad guys. He grudgingly befriends two young Millennial teenage Laos refugees who live next door. He had lost his wife of 50 years. He was in his 70s and dying from some undiagnosed illness. I viewed the movie as an allegory for the generational sacrifice that should be taking place now.

Eastwood’s character, Walt Kowlaski, decided to finish things his way. He realized the two Millennials would never find peace or have a chance at a better life until the criminal gang running the show in the neighborhood were confronted and defeated. He knew he was too old to kill six gang members singlehandedly, so he made a choice to sacrifice himself and be gunned down in cold blood in front of multiple witnesses so the perpetrators would go to jail and allow his Millennial companions to have a chance at a better life. He sacrificed his life for the good of young people who weren’t even related to him.  This message has not connected with the elder generations who control the purse strings and political system in this country. The media propaganda machine supporting the existing regime continues to peddle a storyline that debt doesn’t matter, consumption is good, saving is for suckers, and passing the bill for unfunded entitlements to future generations is not immoral and cowardly. Walt Kowalski displayed courage, bravery, and valor that is sorely lacking in the elderly generations today.

At the age of 50 I have a choice with my remaining 20 or 30 years. I can choose to keep accumulating material goods with debt, voting for politicians who promise never to cut my entitlements, believing deficits growing to infinity are beneficial to the economic health of the nation, supporting the military industrial complex as they wage undeclared wars across the world, applauding the Orwellian fascist surveillance measures instituted to give the illusion of safety while sacrificing freedoms and liberties and selfishly looking out for my best interests. Or I can stand up to the corporate fascist old boy regime and lure them into a violent response that will ultimately lead to their downfall. I’m willing to sacrifice what is supposedly “owed” to me on behalf of my kids and all Millennials. They don’t deserve to start life in a $200 trillion hole created by their parents and grandparents. It is disconcerting to me that more Boomer and Generation X parents are unprepared, unwilling or too willfully ignorant to forfeit entitlements awarded them under false pretenses in order to preserve a decent standard of living for their children and grandchildren. The Bernaysian propaganda programmed into their brains over decades by the sociopathic central planning status quo has created this inertia.

The inertia will be replaced by frenzied activity when this unsustainable system ultimately fails. Time seems to be standing still. People have been lulled into a false sense of security even though history is about to fling us into a chaotic transformational period in history. How do I know this is going to happen? Because it happens every eighty years like clockwork. The best laid plans of the men running the show will be swept away in a whirl of pandemonium, violence, war and reckoning for sins committed against humanity. There will be no escape.

“Don’t think you can escape the Fourth Turning the way you might today distance yourself from news, national politics, or even taxes you don’t feel like paying. History warns that a Crisis will reshape the basic social and economic environment that you now take for granted. The Fourth Turning necessitates the death and rebirth of the social order. It is the ultimate rite of passage for an entire people, requiring a luminal state of sheer chaos whose nature and duration no one can predict in advance. The risk of catastrophe will be very high. The nation could erupt into insurrection or civil violence, crack up geographically, or succumb to authoritarian rule. If there is a war, it is likely to be one of maximum risk and effort – in other words, a total war. Every Fourth Turning has registered an upward ratchet in the technology of destruction, and in mankind’s willingness to use it.” – Strauss & Howe – The Fourth Turning

Our country has entered a period of Crisis. We may or may not successfully navigate our way through the visible icebergs and more dangerous icebergs just below the surface. The similarities between the course of our country and the maiden voyage of the Titanic are eerily allegorical.

The owners of the ship (Wall Street, Washington politicians, crony capitalists) are arrogant and reckless. They declare the ship unsinkable, while only providing half the lifeboats needed to save all the passengers in case of disaster in order to maximize their profits. The captain (Ben Bernanke) has been tendered the greatest cruise liner (United States) in history. The initial voyage across the Atlantic Ocean has drawn the financial elite ruling class (financers & bankers) onboard, occupying the luxurious state rooms on the upper decks. But, the lower decks are filled with young poor peasants (Millennials) who are sneered at and ridiculed by those in the upper decks. A maiden voyage should always be approached cautiously. A prudent captain would not take undue risks.

Our captain (Ben Bernanke) wants to make his mark on history. He considers himself an expert in navigating dangerous waters (Great Depression) because he studied dangerous waters at his Ivy League school. It doesn’t matter that he never actually captained a ship in the real world.  He declares full steam ahead (reducing interest rates to 0% and throwing vast amounts of fiat currency into the engine room boilers). Midway through the voyage, the captain is handed a telegram warning of icebergs (potential financial catastrophe) ahead. If he slows down the vessel, he will not set the speed record and receive the accolades of an adoring public. He ignores the warning and steams on to his rendezvous (eternal disgrace) with destiny.

In the middle of the night, the lookouts (Ron Paul, John Hussman, Zero Hedge) cry iceberg!! But, it is too late. The great ship (United States) has struck an enormous iceberg (debt & currency crisis). At first, it seems like everything will be OK. The captain and crew assure the passengers that everything is under control and their evasive action has saved the ship. But below the waterline, the great ship (United States) is taking on water (toxic levels of debt, un-payable entitlement promises, trillion dollar deficits, political & financial corruption). The engine room (Federal Reserve) works frantically to alleviate the damage (QE to infinity). The captain is sure the compartmentalization of the ship will save it. One of the designers of the ship (David Stockman) sadly declares that the ship will surely sink. The captain orders the band (CNBC, Fox, MSNBC, CNN) on deck to distract the passengers from their impending fate with soothing music. The owners of the ship (Wall Street, Washington politicians, crony capitalists) aren’t worried. They collected their fees upfront and over-insured the vessel. They anticipate a windfall when the ship sinks. It worked last time.

To avoid mass panic, the crew (government apparatchiks) has locked the youthful poor peasants (Millennials) below deck. The captain and his crew are content to let them go down with the ship. They’ve decided the women, children, and senior citizens (Middle Class) can also be sacrificed. The financial elite ruling class (financers and bankers) are piling into the boats with the ship’s jewels, escaping the fate of the peasants. The captain (Ben Bernanke) has no intention of going down with the ship. In a cowardly act, he leaps onto the 1st lifeboat to be launched. We are on a voyage of the damned. The great cruise liner (United States) has a fatal wound and is headed for a watery grave. Are we going to let the owners, captain and crew dictate who will be saved in the few lifeboats or will we rise up and throw these guilty parties overboard?

 

It comes down to the abuse of power by a few evil men and their henchmen as they have centralized their control over our financial, political, economic and social institutions. The existing social order is an ancient, rotting, fetid swamp of parasites that will be drained during this Fourth Turning. The Millennials are rising and will be the spearhead of the coming revolution. As each day passes they will become a more powerful force and the power of the existing regime will wane. Meanwhile, the band will play on as the ship of state descends into the abyss.

My Boomer Life and the Greatest Generation Parents Who Raised Me

I won’t be posting a Quinn-like masterpiece with lots of graphs and statistics. First, I don’t have that ability. Second, I am not a statistic. I am a person … so this will be a personal story with anecdotes about my achy-breaky Boomer life. Mostly, I just want to address the following question;

“ARE BOOMERS RESPONSIBLE FOR EVERYTHING WRONG IN AMERICA TODAY?”

First, let me whine a little.  A number of folks here (you know who you are, lol) answer that question with an emphatic “YES!!”.  I find it incredulous that otherwise very smart folks can say such things. I don’t know if it’s said just for effect to “piss off” Boomers such as myself, or if you can really attribute this country’s Great Malaise to such a simple theory.   It is also rather dismaying that whenever ANYTHING positive is said about the Boomer generation, then that person is accused of being in “denial” or an “apologist”.  It’s almost as if the quest for knowledge ceases when it comes to Boomers … a really surprising turn of events considering the large number of INTJs here.

Others will say we Boomers shouldn’t take it “personally” — which, really, is like calling a black person “nigger”, and then exclaiming, “Oh! Please don’t take that personally”. Tough to do! Accuse me of whatever you wish. I simply cannot wrap my tiny mind around the Broad Brush Approach — lumping an entire generation of 76 million people  as the cause of Everything Evil is not wise, helpful, applicable, or even possible, imho.  You might as well say, “Humans caused all our evils” … which would also be equally correct, and equally useless since the classification is too enormous.  But if one is looking for an Easy Unified Theory of Everything Wrong With America … “Boomers Did It” … well, have at it.

I cannot identify with the rich Boomers, because I am not rich. I cannot identify with the rich Greatest Generation , because I am not rich. I cannot identify with the rich of any generation, because I am not rich. Without advocating a class-warfare approach, I must maintain that a far greater divide in America is along Class — not, age.  The mega-rich, the mega-powerful, the ultra-elite — yeah, the 1% — as George Carlin says, THEY are your owners! Redirect your anger accordingly.

I am NOT against the younger generation. I love ‘em. I feel I have more in common with my emotionally troubled son than with most Boomers in my life.  Unlike what happens to many old farts, he at least he still questions everything, still wonders what this crazy life is all about, still wonders how he “fits in”.  Just like I did when I was his age, and actually, still do to some extent.  \\end:whining//

STUCKY  CONSIDERS HIS PAST WHILE AT A CHRISTMAS CONCERT

A couple Sundays ago I went to my Dad’s Christmas concert.  He sings for The Plainfield Gesang & Turn Verein, a German-American heritage club that was founded in 1886. There were about 200 people in attendance.  I would say that 90% of demographics were Boomers such as myself and our parents, The Greatest Generation.

I not only listened to the music, but as I watched my dad singing so proudly, and as I glanced at my mom who always gets weepy at this event, my mind also grew nostalgic, as it is prone to do at such holiday occasions.

It is only in the past few years that I have seen my parents as “whole” persons. What I mean by that is that their whole existence on this planet, as far as I was concerned for most of my life, only started around when I was 5 years old … my earliest memories of them. That means about 30 years of their lives — while they did start to tell me bits and pieces once I turned 17 and thereafter — well, for all intents and purposes it simply didn’t exist. What a damn shame, to my own detriment, that I didn’t even care about the great fountain of experience and knowledge I so easily dismissed. The major event that shaped my parent’s lives was WWII. With apologies to all those here who know this story, I shall very briefly summarize it for those who don’t, for context.

My dad was a German living in Romania.  One day, when dad was a teenager, the German Army came sweeping into his village, yanked him from his home, told him he was in the German Army, sent him to the Russian front, where he was captured, spent time in a Russian prison camp, and upon release was not allowed to return to Romania and never saw his family again, but was instead sent to England to work in the coal mines for several years – a form of ‘reparation’, before he made his way to a refugee camp in Austria.

My mother was a German living in Yugoslavia. One day, when she was a teenager, the Russian Army came sweeping into her village. They shot a lot of older German men – the young ones were all off to war — on the spot. Virtually all the women in the village were promptly sent to a Russian gulag, where she was raped, saw her mom raped and then murdered in front of her eyes. After the war ended only she and her brother remained alive, they were not allowed to return to their village, and they walked to a refugee camp in Austria.

I don’t relay these events for pity. Screw that. They are just one of millions of German families who suffered in WWII … just as millions of Americans have suffered in WWII, with only the details changing. I just have a story to tell, and my parent’s story is a huge part of my story. Of course I can’t speak for 76 million of us except in a general sense.  For example, I graduated from a high school of about 2,000 and I feel comfortable in saying we all share the Same Boomer Story, generally speaking.

THE KEY TO UNDERSTANDING BOOMERISM

The point is these are the people who raised my fat Boomer ass … which they did not do in a vacuum, independent of things that shaped their lives.  The picture in your mind’s eye of a “Boomer” is quite incomplete if you forget, or misunderstand, our Greatest Generation parents.

So, I’m watching my mother as she watches the concert, I put my hand around her shoulder as I see her eyes well up with tears. What is she thinking?  What pains are still so real to her today .. that I can’t help her with?  I start thinking about my own 59 years of living … how crystal clear certain events of my own teenage years still are … as if they happened yesterday. And then a feel a certain shame that it took me so long to see my parents as whole persons.  I suddenly feel despondent that I so despised several aspects of my upbringing that I couldn’t wait to join the military, even in the midst of the Vietnam war, just to get the fuck out from under my parent’s thumb.  Before taking a look at how the Greatest Generation raised us, let’s quickly take a look at another key to understanding Boomers;  the world in which we lived

HAPPY HAPPY JOY JOY ??

The Gay 20’s really weren’t all that gay, just as  the world Boomers inherited wasn’t only the fun, Hippie, pot-smokin’, LSD trippin’, rock’n-roll groovin’, free love image that is remembered today. Two big events and a ton of smaller ones helped turn our once pure souls to the Dark Side.

First Big Event: Da Bomb. Russia. Nukes. Commie bastards. Ka-BAM! All gone. Nuclear winter. Dead. Why??? Nuke drills!! Little Boomer children hiding under desks for protection. Little Boomer children watching gub’mint movies showing homes blasted to smithereens. Little desk hiding Boomers not stupid, “We gonna die under this desk!!”  Was I forever traumatized – some prepubescent PTSD – by these drills? No. Did it affect my perception of what the world was about and that just maybe it made no sense at all and that the grownups were idiots and that since tomorrow may never come so I might as well live just for today … even though I was just a kid at the time?  You better believe it.

Second Big Event. Vietnam. Dirty, nasty, disgusting, vile war that killed 60,000 of us and maimed hundreds of thousands more. What was it good for? Absolutely nothing.  Did it affect my perception of what the world was about and that just maybe it made no sense at all and that the grownups were idiots and that since tomorrow may never come so I might as well live just for today? You better believe it.

Not to mention in no particular order;  civil rights ….. riots …. . corrupt government openly lying ….. a disgraced president ….. dead soldiers faces broadcast on TV every night ….. Kent State …..  double-digit unemployment ……. Midnight Cowboy ….. 25% interest rate for a home loan ….. gas lines ….. shitty cars that exploded ….. S&L crisis ….. Bay of Pigs ….. nukes in Cuba!! …. Abortion …. JFK ….. and, MLK …. Jimmie Hendrix and Janis Joplin …. Gloria Steinem and  woman’s rights ….. no more prayer in school ….. the Ayatollah ….. Supreme Court turns activist all over the place …… Korea ….. school integration ……………….

It was the best of times, it was the worst of times. Did we shape the times, or did the times shape us? I think it’s the latter. Simple math. 

The first Boomers were born in 1946.  How old are the people-in-charge, the leaders, the CEOs, the 535 politicians that rule our lives … i.e., the people who actually make things happen?  Let’s be conservative and say that it’s 30 years old.  So, the first Boomers with power to affect the status quo  arrive on the scene only in 1975.  I  would say Boomers  took the helms of power around  daddy Bush’s presidency in 1989 – when the first Boomers were 43 years old.

The “ME Generation” —- A MISNOMER

We are … and you may add the adjective “most” to many  of these descriptions;  selfish, self-indulgent, unwilling to sacrifice, politically correct, drug addicted, material minded, entitled, liberal or commie shits, bad parents, lazy, humans to ever walk the earth. And to top it all off we invented Afro’s and disco (actually, two legitimate reasons to hate us).  Amazingly, we accomplished all this because of the year in which we were born.  And because of our sin of ‘The Year Of Our Birth’, you can go to literally hundreds of blogs other than here and find the admonishment that Boomers should “just die already”.  The implication being, that once this happens, pretty much everything will return to bliss, prosperity, and overall happiness.  I read that we Boomers only cared about only three things;  1) Me, 2) Me, and 3) Me.  Just like the “love of money” is the root of evil,  our preoccupation with “Me” is the root cause underlying our evilness.

BUT — the ME-Generation was raised by the Greatest Generation.

How would YOU like to be born following that moniker?  Imagine you have just one older sibling, and your parents referred to him/her as “The Greatest Kid”.  It just might fuck you up!  Lol   Boomer babies didn’t drop out the shoot and at the moment of birth become The Most Selfish Bastards ever.  We did not raise ourselves. Somewhere along the line, some person(s) and some event(s) helped us along into becoming selfish pricks.  Cause leads to effect, nature abhors a vacuum.

What do you THINK you know about The Greatest Generation?

Unless you’re a Boomer, what you think you know about the Greatest Generation is likely inaccurate.  The people you know as grandparents are NOT the same people who raised us.  Some kind of Weird Assed Transformation took place from the time we were born to the people you know. Maybe it has to do with the aging process – whereby one becomes more introspective, soft hearted, and most importantly – accepting of Things As They Are … not, What They Should Be, a mantra us Boomer kids heard a million times if we heard it once.   Maybe it was the realization that their own Materialism was a big mistake … and trust me on this, in many ways they were much more materialistic than their boomer children.  Maybe they didn’t ‘change’, maybe they just ‘adapted’ – but, the Metamorphosis into A New Life Form –one that is NOW loved and revered —  is and was spectacular.  

Let’s take a look at what Boomer kids heard growing up

“ I’m not buying you a new pair of Converse sneakers. You think money grows on trees?”

“You’re not going out dressed like that, are you? What will the neighbors think?”

“I slave all day to put food on the table, so you damn well better eat all of it!”

 “You don’t know what hardship is all about.  WE had it rough.”

“Kids in China are starving. Learn some gratitude, dammit.”

 “You see all the stuff we have?.  We did all this for you.”

“Turn off the damn lights. You think electricity is free?”

 “You don’t know the meaning of sacrifice.”

“Cut your hair!  At least look respectable.”

 “You don’t know how lucky you are.”

“At least you could show some respect.”

 “You don’t know the value of things.”

“Why don’t you appreciate anything?”

 “Quit acting like a bum!”  KaPow!!  (We boomer kids got wacked …. A LOT)

If you don’t see a significant amount of materialism in those statements then, I’m sorry, you’re just not being perceptive enough.  Materialism is largely a state of mind.  Bertrand Russel said,  ——- “It is the preoccupation with possessions, more than anything else that prevents us from living freely and nobly.”

HANGING ONTO WHAT YOU GOT LIKE YOUR LIFE DEPENDED ON IT

It’s not about how much stuff you own. It’s about the stuff you own that eventually owns you.  A middle aged man attempts to reclaim his youth and buys a vintage Harley, just like the one in Easy Rider. He owns the bike.  Before you know it he’s spending all weekend polishing every nut and bolt.  Then he decides it needs some restoration, and he spends a few grand doing that.  Then he spends more and more time away from his family and with his fellow enthusiasts, riding around town, showing off like a peacock. Then one day his teenage son accidently puts a small scratch on the fender.  He hurls a string of expletives at his son for committing this unforgiveable sin.  The bike now owns HIM.

Although I lacked nothing growing up, my pre-boomer angst was fueled by the ever present possibility that all the blessings bestowed on me could be lost at any time. From scarcity we came, and to scarcity we could return.  This pretty much fulfills Bertrand Russels’s  materialism “preoccupation” criteria. Our stuff, meager as it might be, owned us.  The resultant activity of the scarcity meme, in terms of materialism, is that my Greatest Generation dad worked his ass off to make sure scarcity would never rear its ugly head. This is admirable and not to be condemned.  Don’t you, and I, do the very same thing for our children? 

But, it did have unintended consequences.  Growing up I couldn’t help but feeling that material gain was more important than anything else. Our parents did work their fingers to the bone.  But by the time they dragged their tired asses through the door, they were too tired to hug us.  They were too tired to have any really meaningful conversations, especially about sex.  “Children should be seen, and not heard.” , I swear was God’s eternal truth scripted somewhere in the Gospels. So, we spent a great deal of our time out of our parents’ sight.  That was great for both of us … far less arguments.

We even had our own special place to play in the house.  The basement. We sure as hell never romped around the main level, especially the living room;  “Don’t sit there!  That’s GOOD furniture!!”.  Our little boomer minds duly noted; ‘furniture more important than us’. Watch reruns of ‘Everybody Loves Raymond’ and Marie’s living room to see the hilarious abortions  our parents resorted in order to “save” the good furniture;  they covered everything in plastic! Lol  All of us immediately identified with the advice Dustin Hoffman received in The Graduate;  “Plastics, my boy. Plastics.”  Eventually we got the last laugh when all that plastic shit turned a putrid shade of yellow, and the cushions smelled like skunk ass when the plastic was removed. Meanwhile, we were banished to the basement where we could destroy nothing of real value.

FROM DEPRIVATION TO EXCESS TO REBELLION

One of the most common reactions to deprivation is excess.  For example, people who have faced starvation will often, once circumstances have changed, become gluttons.  This was our parents’ response.

Then, as time passes, a typical reaction to excess is rebellion. This was our response.  For example, on a grand scale a Colonist eventually  rebels against the excesses of his British masters, and dumps tea in the bay.  On an individual scale, children (of any era) eventually rebel against their parents’ excessive rules by doing the exact opposite. The goal of the Rebel, whether a nation or a child,  is always to starve the master of their power.

This dynamic plays out predictably well in the Greatest Generation / Boomer relationship.  The Greatest Generation faced deprivations in spades; from the Great Depression to Dust Bowls to World War II. The end of the Big War ushers in the greatest economic boom in American history, or something like that.  Remembering their deprivations the Greatest Generation becomes as materialistic as any in recent memory.  Some of you folks err when you compare that materialism back then with what we have today.  You look at countless graphs, data, GDPs, debt, one financial ratio after another … compare the two eras … and somehow conclude that the Greatest Generation were ‘savers’.  The “numbers” don’t look so bad back then only because the whole shebang was just getting started.  Some shit just takes time to get stinky.

What was this great economic post-war boom about? Was it not the beginning of Consumerism? What do you think this is all about;  … getting that little starter house, then upgrading to the bigger house with the nice white picket fence, movin’ on up to a good neighborhood, getting that  fifty cent promotion, replacing a literal ice-BOX with a real refrigerator, getting a nice big Dee-troit car or two,  the explosion of corporate TV shows like the Colgate Comedy Hour … if not consumer fueled materialism? Excess folks, excess.

“Oh Yeah?  Well …. fuck you!!”

The Boomer children, mostly neglected as daddy –and soon, mommy – pursued the Good Life (FOR us, naturally) reacted in a way that shouldn’t be a surprise …. we rebelled against our oppressor for their real or imagined sins.   Only we did with much greater aplomb than ever before ; we didn’t fuck around, we were all in. 

They had short-haired geeky musicians, we had long-haired hip rockers.  They had booze, we had drugs.  They had rules – lots of them —, we had none. Free Love, baby!  If it feels good, do it. Love the one you’re with.  They worked hard, we went to Woodstock. They had a lifeless church, we had the Jesus Movement.  They followed the call of  Madison Avenue,  our hearts  hung out at Haight and Ashbury. They liked Ike, we preferred Dylan.  They wore penny loafers, we had sandals and a bandana (and other ridicules articles of clothing). And so it went at every turn; right or wrong, a repudiation of ALL that came before.  So people  look back on this crazy-assed behavior and label us the “ME” generation.  I’ll grant you that there is some truth to that.  But, it falls far short  of what was really going on. It wasn’t “me, me, me” as much as it was; “fuck you, fuck you, and fuck you”.

BTW, isn’t that EXACTLY what the younger generations are saying about us Boomers; “Fuck You!”?   History rhyming yet again. Solomon correctly wrote; “Vanity of vanities, there is nothing new under the sun.” I don’t know what dumbass mistakes this younger generation will make — I sometimes feel they think they’ll make none, the first Perfect Generation — but trust me on this one thing oh Young Ones, you too will blow it … and your offspring will mock you as well.

BOOMERS NEVER EARNED ANYTHING — EVERYTHING WAS HANDED TO THEM

Nothing quite baffles me like this accusation.  I shake my head wondering exactly what was given to me. I started out getting a fifty-cent allowance, back when fifty cents could still get me into the movies (double feature plus cartoons, a soda, and a popcorn and get a nickel back). It wasn’t “free” either … it came attached to doing chores.  Mow the lawn, take out the garbage, do the dishes when asked, and keep my room clean.  This our parents called “learning responsibility”. All for 2 bits … good thing we weren’t Unionized.

But for real money to get real stuff — like those Converse sneakers — we had to work.  So, I got my first job at around 13 selling subscriptions of the town newspaper door to door on Saturdays.  I got a dollar per new subscription.  Some Saturdays I’d rack up 20 plus bucks and back then that was living large. My first real job was in high school. I worked in a lasagna factory, stirring lasagna in a huge vat of boiling water … for $1.35 an hour. And I never stopped working since.  We worked hard all our lives. My friends all did likewise.  So. Pardon me if I am offended at being called “selfish, greedy, and entitled” as I refuse to accept that label.

Speaking of “entitled”, perhaps this is what people mean; all those juicy gub’mint entitlement programs, especially SS and Medicare.  First of all, social security was NOT created by the Boomer generation. So, solly.  Try the generation before us. Medicare was NOT created by Boomers either. Sure it was enacted in 1965. The oldest of the Boomer generation would have been born in 1943 … making that Boomer just 22 years old in 1965. The voting age was still 21.  Please don’t tell me Medicare was voted into being because of then 22 year old Boomers!

I know people just hate it when us old farts “expect” to collect on SS. Can you walk in my shoes for a moment?  Let’s say you paid $50,000 into some account set up by the gub’ment. It is money you earned by the sweat of your brow.  You didn’t ask the gob’ment to do this for you.  They took it by force and promised to give it back to you later. Much later. That “much later” is now here, and some people want to tell us, “Hey, you can’t have the money. The gub’ment spent it and you can’t have it.” We used to have a word for this: Theft.  Look, I can understand that I may not be able to collect SS forever until I die.  But, can I at least get MY $50,000 dollars back?? You don’t even have to pay any interest, if that makes it better.

I AM NOT RESPONSIBLE FOR THE SINS OF MY BRETHREN

I won’t cover any of the other Entitlements / Social Programs.  All I  can tell you I voted Republican most of my life, and I cannot ever recall voting based on getting free shit.  Foreign policy, wars, and character where my usual hot buttons. I don’t know how other Boomers voted. I don’t care.

I don’t care because I don’t believe in the idea of Collective Guilt. Google that term and the first page will show articles on “German collective guilt over Nazis”, so this is a topic I personally know something about. It is a heinous principle first found in the Old Testament that — “The sin of the fathers He punishes on the children to the third and fourth generation.”  A monstrous mockery of justice!! Collective guilt refuses to acknowledge the INDIVIDUAL. Evil regimes and their dictators (Stalin, Mao, Marx, etc.) love collective guilt as they collectivize individuals as “the populace” or “the masses” or “the workers” and then enslave or execute them as it suits their purposes. That’s why I have often said here that the demonization of Boomers may one day logically lead to Death Chambers for us old farts.

You, dear reader, don’t believe in collective guilt either. Do you find yourself guilty of the crime of slavery? No.  Do you find yourself guilty for the genocide of Native Americans ? No. Do you find yourself guilty for Mai Lai? No.  Do you find me guilty for Buchenwald?  No.  So why do you throw all Boomers in the Collective guilty pot?  It is said ‘people get the government they deserve’.  If that’s true then I should find YOU guilty for the current mess we’re in. But, don’t worry, I won’t because that entire argument is specious.   Here’s one way we should follow in the footsteps of the Greatest Generation; they didn’t blame their own parents for their youthful excesses of the ’20’s which then led to the financial ruin of the Great Depression . They just pulled themselves up by their bootstraps and made the best of a bad situation. So should we.

“YOU MADE PROMISES TO US ………. AND YOU LIED!!”

Another common theme amongst disgruntled Utes are the broken promises we Boomers made. When I went to the Occupy Wall Street demonstration in NYC I saw more than a few Utes displaying  posters about Education  … “$60,000 in Student Loans and No Job”, and several variations thereof, including demands to forgive the debt.  For change of pace I will number my responses.

1)— Guess what kids?  Your generation isn’t the only one that was lied too. We were lied too, also. So, welcome to the real world.

2)— Guess who told us that education was the path to a better life?  That’s right, our Greatest Generation parents.  We just passed what we learned in OUR youth, onto you. By and large that’s how parenting works. Again, welcome to the real world.

3)— Our parents valued education because they were mostly blue-collar workers toiling away in factories (remember those?). They saw first-hand that the “higher-ups”, the folks in the office, the guys in white-collars made significantly more loot than they did.  So, putting two and two together they came up with the brilliant conclusion that education pays.  And that’s why I got my ass kicked whenever I brought home a bad Report Card. The first question at the dinner table was, “Did you wash your hands?”. The second and usually last question was “Did you do your homework?”  Study, study, study was drilled into our mush brains until the cows came home. It is really no more complicated than that.

4)— What’s wrong with furthering your education anyway? Did we commit some Mortal Sin in telling you to study? Don’t you know that we “pushed” this Horrible Thought on you for a reason?  Don’t you know that with knowledge you’ll learn how to think and analyze. Don’t you know the value of  using logic and rational thought, and how that will benefit you throughout your life?  Don’t you know we wanted to give you a foundation that would allow you to filter through all the bullshit the world tries to feed you? Apparently, not.

5)— Regarding not paying back your loan.  Where did you learn that from?  Certainly not from us Boomers when you were young!  Again, we taught you what was taught to us. And here’s one thing I can guaran-damn-tee you our parents showed us; paying one’s bills was a Badge of Honor.  It wasn’t God, country, and apple pie. It was Pay Your Bills, God, country, and apple pie. My parents would sacrifice a meal in order to pay a bill.  We taught you to do the same when you were little.

Here’s what Boomers and the Greatest Generation did wrong.

6) We monetized “value” when talking about “the value of an education”.  Did the Greek philosophers value education to make more money? No.  Did the great men of the Renaissance era value education to make more money? No. Did our Founding Fathers value education to make more money? No.  The “value” of an education is more than exploiting it for financial gain (see #4 above).  But, clearly, modern America is all about the Almighty Dollar.  So, I went to college pretty much in order to make better money. And I told my kids to go to college to make better money. Guilty as charged. Money, it’s a gas. I suppose what pisses off Utes is that Boomers were actually able to get jobs when they graduated, while they can’t. Which leads me to my final point.

7) Tough shit!!  And please don’t tell me us Boomers “guaranteed” you a good job upon getting an education. First of all if you actually believed such a statement you need to recalibrate your Bullshit Detector. They never has been and never will be any guarantees in life, except death, taxes, and obese fat women pictures from our own beloved AWD.  Secondly, it’s a lie from hell.  Our Greatest Generation parents were keenly aware of the possibility of losing it all … again.  

They even coined a unique phrase to drill home the concept of no guarantees; –“you never know”. For example, “Put down that stick! You could poke your sister’s eye out, YOU NEVER KNOW!” (In my childhood there were apparently about 845 ways to poke out my sister’s eye.) Or, “Put on clean underwear before we drive to church.  We might have an accident, YOU NEVER KNOW!”.  Or, “No, we’re not joining the community swimming pool.  We need to save every penny, YOU NEVER KNOW when we’ll need it.”. 

Lastly, Utes also blame Boomers that they can’t get married,  they have to live with their parents, will never be able to start a family, buy a house, etc. etc.  It all boils down to “life isn’t fair”. Well!  1) we Boomers used that phrase on our own parents a million times.  Please come up with something new.  2)  In what fairy-tale are you living where ‘fairness’ is the rule of the land? 3) Stop emulating Gordon Gecko. Try, Tim the Toolman. 4) My parents taught me this and I pass it along to you.  Perhaps the Ten Best Words Of Advice you will ever hear;   “Life isn’t fair. Get over it. DO something about it.”

FINAL THOUGHTS

In closing, let me say that I’m not trying to change the real Boomer Haters. It was downright depressing doing some research for this article. I don’t know exactly how widespread this hatred is, but what is out there is savage, vicious, and said with such ferocity that I wonder when, not if, the loathing for my generation  turns into violence against us.  Every revolution has at least one scapegoat. The “Boomers Suck” meme is paving the way towards acceptance of  our destruction, should it go that far. How does one change such a person’s opinion?? But, there are folks out there who have yet to decide if they shout hate/blame Boomers for everything.  I hope this article reaches those.

I also hope this does not come across as either making excuses or rationalization.   It’s just my story, and I assume it’s similar to millions of others in my age group unfortunate enough to be labeled a Boomer. All I tried to do is tell it as it is … yes, as I see it with my Boomer-tainted goggles … and in the telling I know I barely scratched the surface.  

One thing I know is they we are ALL in this together. When I see a homeless man in NYC, he may be a Boomer … or, very well be a more recent generation. I often drop a few dollar bills, but I don’t first verify his age, because I don’t see a GenX or Boomer … I see only a homeless person, a human being who is worthy of compassion because I realize “there but for the grace of God go I”. 

I think it’s a fact that most of us Boomers have seen our savings, our assets, our net worth dwindle before our eyes and most of us are not well off. I think it’s a fact that most Boomers still work, and probably will need to work —- either until we die or the ravages of age incapacitate us.  And if we are incapacitated … and if the timing is such that all the Free Shit is no longer available … then don’t worry about killing us, as I believe many will commit suicide.

Lastly, I am fully aware I have my own biases, and as we discussed in another thread from last week, “total honesty” in the trillion plus connections  organized by our highly fallible brains may not even be possible . Not only might I “not know” the truth, it is conceivable “I don’t even know that I don’t know”.  In other words, yeah, I could be full of shit. (If so, I’m sure you will inform me thereof. Lol ) But, I doubt it.

Peace

Herr StuchenBoomer

SCREWED GENERATION

Does the entitlement/welfare/ warfare state benefit the Boomers or the Millenials? Has the massive consumer and government debt accumulated over the last 30 years benefitted the Boomers or the Millenials? Who will vote in massive numbers to keep the status quo? Who didn’t save enough for their retirement so they are not leaving the workforce, keeping young people out of the workforce? Who gets sent to die in wars started and managed by Boomers? During Fourth Turnings the Prophet Generation is supposed to lead and the Hero generation is supposed to follow and do the heavy lifting. Not too much leadership coming from the Prophet generation, just finger pointing, greed and blaming the youth for their own sins. Yes, Boomers have earned their reputation as the Shallowest Generation.

Older generations to the young: Drop dead

The acronym NEET first gained wide exposure last August, when riots blamed on young people “Not in Employment, Education or Training” broke out in London’s Tottenham district. It’s a useful term, particularly with youth unemployment fueling the angst over the European debt crisis.

The NEET rate among those 15 to 24 years of age is 19 percent in Italy, 18 percent in Greece and 17 percent in Spain and Ireland. In the United States, it’s almost 15 percent, according to figures compiled by the Organization for Economic Cooperation and Development.

Urban development expert Joel Kotkin has another term for this group of young people: “The Screwed Generation.” Writing at his website NewGeography.com, Mr. Kotkin calls these young people “the victims of expansive welfare states and the massive structural debt charged by their parents.”

Mr. Kotkin has a knack for a blunt phrase. In 2004, when he was at Pepperdine University in California, he was hired by the Greater St. Louis Economic Development Council to study how St. Louis could attract young professionals and entrepreneurs. Mr. Kotkin had some useful recommendations, few of which were remembered after he told a Post-Dispatch editorial board meeting, “Your downtown sucks.”

His view of the dim prospects facing today’s young people is rooted not just in NEET numbers, but in studies that show many college graduates are struggling to find full-time employment at a living wage. One study of 444 recent graduates by the Center for Workforce Development at Rutgers University showed that only 51 percent of graduates of four-year colleges between 2006 and 2011 had found full-time employment. Twenty percent had gone back to graduate or professional school, but the rest were working part-time or not at all.

Data from the 2010 census show the number of unemployed young people, age 16 to 29, declined 18 percent between 2000 and 2010 to its lowest point since World War II. Nearly 6 million Americans aged 25 to 34 are living with their parents, up 25 percent since 2007. Among families with heads of household younger than 30, the the poverty rate was 37 percent.

Ninety-four percent of them came out of college carrying at least some debt; the median debt load for graduates of public universities was $18,690. It was $24,460 for private university graduates.

It’s not just that companies have been slow to expand, it’s that older workers are staying on the job longer, working at least until full Social Security and Medicaid benefits become available. These are benefits that young people will be taxed for (assuming they get work) but, given long-term budget outlooks, may not be available in 40 years.

And not only are older Americans hogging the jobs and the benefits, they’re voting in large numbers against changing the calculus. Having enjoyed the benefits of post-war prosperity, many older Americans don’t want to pay the debts they’ve incurred, much less preserve benefits, repair the infrastructure or fix global warming.

Screwed is right.

In the 2008 presidential election, record numbers of 18- to 24-year-old voters turned out at the polls. They may not match that 49 percent turnout this year. Their elders vote at rates of up to 70 percent.

It’s easy to understand why America’s NEETs and debt-burdened college graduates would be disenchanted with politics. But they really can’t afford to take the year off.

Read more: http://www.stltoday.com/news/opinion/columns/the-platform/editorial-older-generations-to-the-young-drop-dead/article_68af2bc2-55be-5273-802c-972fc54cde72.html#ixzz1xIkNqnPa

2012 ELECTION – NEIL HOWE STYLE

Neil puts the 2012 election into a generational perspective. If you are looking for Neil to pick a winner, read no further. He’s an academic at heart and never tells you what he thinks will happen. But, he supplies plenty of data for you to make up your mind. Based on his breakdown of voters by generation it seems that the Millenials will decide this election. They are still strongly in Obama’s camp, but their enthusiasm for Obama has waned. If they don’t vote in significant numbers or if Romney can split the young white vote, the election would go to Romney. The old farts are strongly in Romney’s corner. GenX is split down the middle. The yuuts will decide this election.

Pundits have long been predicting that the presidential election will be much closer and much meaner in 2012 than it was in 2008.  Closer it now is.  According to the RCP Poll Average, the race is now a virtual tie: Incumbent Obama now leads by a mere 1.8 percent over Romney, whereas challenger Obama led McCain by 7.6 percent exactly four years ago.  It will certainly revolve around a very different array of issues—much less argument about the war on terror and GOP performance, and a lot more about the stagnating economy and Democratic performance.

In one respect, however, the next election will be a replay of the last: There will be a historically large divide in the preferences of younger voters (under 30) versus older voters (65+).  In 2008, this divide (21 percentage points) was wider than in any election since the advent of age-bracketed voting data in the 1960s.  The second-biggest divide (16 percentage points) was back in 1972, when nearly half of all young voters voted for McGovern while older voters went overwhelmingly for Nixon.

 

I’ve been tracking generational leanings in the polls pretty carefully.  The Pew Research Center has issued several reports (most notably, The Generation Gap and the 2012 Election) exploring this divide, and Time followed up with its own cover story (“The New Generation Gap”).  More recently, Mike and Morley, Forbes, The New York Times, and many others have also weighed in.

Bottom line: Every generation is today a bit more favorable toward Obama than they were in 2010 and a good deal less favorable than in 2008.  The partisan gap between the Democrat-leaning young and the Republican-leaning old, however, remains as strong as ever—at around 20 percent.

Back in 2008, the big story was how and why today’s rising Millennial Generation voted by a large and decisive margin for the Democrats.  This fall, the media focus may shift.  The big story could be how and why today’s angry, aging Silent Generation put the Republicans over the top.  The relevant parallel here is 1972, when Nixon was able to split the young Boomer vote with McGovern—and then crush McGovern with all voters over age 30.  (Nixon’s popular margin in 1972, 23.2 percent of the electorate, is the fourth largest in U.S. history.)  Romney, of course, cannot hope for Nixon’s margin.  But the basic logic still stands.  Romney doesn’t have to win the youth vote; he just has to contain youth losses enough so that his huge advantage among older voters puts him ahead.

The 2012 election will hinge on the collective choices of five generations of voters, each with a different collective life story shaped by its own location in history.  Let’s take a look at how each of these stories is likely to determine the outcome.  (Throughout, I will borrow shamelessly from Pew’s wonderful cohort-tracking research and graphics.)

Because this piece turned out to be pretty long, I’m going to break it into two posts.  This post will look at the generations themselves.  The next will look beyond generations to the election outcome.

At the very elder edge of the electorate is the G.I. GENERATION, born between 1901-24. (Sample leaders: John Kennedy, LBJ, Richard Nixon, Jimmy Carter, Ronald Reagan, George Bush, Sr.) With its youngest members now age 87 and older, the G.I.s today comprise just 2 percent of likely voters.  Except during the late 1960s and 1970s, this “greatest generation” has always heavily favored the Democrats, having come of age as huge supporters of the “big government” presidency of FDR.  Indeed, in every election from 1994 to 2004, the peers of Jimmy Stewart were more likely than younger Americans to vote Democratic. [See the “Roosevelt” chart on this page from the Pew study.] Even in 2008, according to Gallup, Obama ran almost even with McCain among these overwhelmingly white 80+ voters—better than he did with any other age bracket over 40. Apparently, generation trumps age when it comes to racial bias. Prediction for G.I.s in 2012: slight edge (3 percent) to the Democrats.

Now let’s turn to the “young old.” Dominating the ranks of retirees is the SILENT GENERATION (born 1925-42, today age 69 to 86), comprising 13 percent of likely voters. (Sample leaders: Robert & Ted Kennedy, Martin Luther King, Jr., Walter Mondale, Michael Dukakis, Gary Hart, John McCain.) Coming of age during the Truman, Eisenhower, and Kennedy presidencies, when Americans generally were voting Republican, the young, conformist Silent leaned more Republican than the rest. While the Silent produced nearly all of the most famous civil-rights leaders and “good government” reformers of the post-war era, they have never favored a strong executive (no Silent has ever been elected President) and have tended to return to their GOP roots as they have grown older.  In seven of the last nine elections, they have voted more heavily than other Americans for Republicans. [See the “Truman” and “Eisenhower” charts on this page.]

Since 2008, the Silent’s pro-GOP tendency has widened considerably, along with their unhappiness with the direction of the country. Polls show the Silent are upset not just because they are “angry” at government (they are twice as likely as Millennials to say this), but also because they are “uncomfortable” with positions they associate with younger Obama Democrats on issues such as immigration, marriage, homosexuality, religion, and the Internet. The Silent are the least-immigrant generation (per capita) in American history, and they grew up at a time when the rules of life were clear and simple. Today they are disoriented by the bewildering diversity of today’s younger generations, and they can’t figure out what the new rules are.

Most Silent recognize that are doing well economically compared to younger Americans. But they worry that America is losing its sense of exceptional “greatness” and gaining an addiction to endless public debt—faults they attribute more to Democrats than to Republicans. Many fear the nation is headed back toward the Hard Times they witnessed in their childhood. According to recent Gallup surveys, the Silent favor Romney by 14 percentage points. Prediction for the Silent in 2012: large margin (15 percent) to the Republicans.

Occupying midlife and already surging past age 65 is the BOOM GENERATION (born 1943-60, today age 51 to 68), today comprising 31 percent of likely voters. (Sample leaders: Bill & Hillary Clinton, George W. Bush, Al Gore, Newt Gingrich, Mitt Romney, Condoleeza Rice.) Boomers came of age during the social and cultural upheavals that rocked America during the late ‘60s and ‘70s—giving them a fixation on vision and values that defines them even to this day as a generation of individualists and culture warriors (left versus right, “blue” versus “red”). As they grow older, Boomers increasingly call themselves “conservative,” but not necessarily Republican.

First-wave Boomers (today in their 60s) have more years of education than younger Boomers, have done better economically, vote more reliably, gravitate to humanist or mainstream churches, and vote more for Democrats. Last-wave Boomers (today in their 50s) experienced a rapid fall in SAT scores and college attendance, lag far behind first-wavers economically, vote less often, veer toward atheism or “born-again” evangelicalism, and vote more for Republicans. In recent elections, first-wave Boomers have tilted to the Democrats; their younger brothers and sisters have favored the GOP. [See the “Kennedy/Johnson,” “Nixon,” and “Ford/Carter” charts on this page.] In recent months, Gallup shows Boomers favoring Romney by about 5 percentage points. Prediction for the Boomers in 2012: medium edge (5 percent) to the Republicans, with red-leaning last-wavers slightly overpowering blue-leaning first-wavers.

Today’s emerging leaders and the parents of most school-age kids belong to GENERATION X (born 1961-81, today age 30 to 50). Gen Xers now comprise 35 percent of likely voters, a slightly larger share than Boomers.  Gen X’s share should be much larger, but their tendency to vote less often than older generations dilutes the impact of their raw numbers. (Sample leaders: Barack Obama, Sarah Palin, Chris Christie, Kirsten Gillibrand, Marco Rubio, Bobby Jindal.) The left-alone children of the Consciousness Revolution who later came of age during an era that stressed free agency, personal ownership, and survivalism, Gen Xers have mixed feelings about the two parties. Xers like the social and cultural liberalism of Democrats (whatever “works for me” is perfect), but they also like the economic conservatism of the GOP (hey, don’t even think about picking my pocket!).

Like Boomers, they show a strong political trend from oldest to youngest, but it’s in the opposite direction.  First-wave Xers, born in the early 1960s, first voted during the early Reagan years and have thereafter leaned heavily to the GOP. (Just over 70 percent of today’s state governors and members of Congress born from 1961 to 1965 are Republican—the biggest partisan tilt of any five-year cohort group.) Late-wave Xers came of age with Clinton and now lean more toward the Democratic Party. [See the “Reagan/Bush” and “Clinton” charts on this page.] According to recent Gallup polls, Generation X favors Obama by 1 percentage point. Prediction for Gen Xers in 2012: dead even, with GOP-leaning first-wavers exactly neutralizing Democratic-leaning last-wavers.

Finally comes the youngest generation of voters, the adult members of the MILLENNIAL GENERATION (born 1982-93, today age 18 to 29), comprising 18 percent of likely voters. (As yet, they have no national political leaders.) Twenty years ago, they were the special and fussed-over “Friends of Barney.” Today, they’re telling older Americans to share their toys and put a smile on their face. For Millennials, the team comes first: They are more likely than older voters to favor strong communities, urge consensus solutions, trust “big government,” and shrug at paranoia over privacy. With their trademark confidence, Millennials embrace many of the social trends (related to race, ethnicity, religion, homosexuality, and the Internet) that older voters find threatening. Millennials are the least likely to believe such trends undermine patriotism or family cohesion. They are the most likely to be optimistic about America’s long-term future.

This outlook puts Millennials decisively in the Democratic camp, with roughly two-thirds of them (66 to 32 percent) voting for Obama over McCain in 2008 and (according to Gallup) a smaller yet still impressive margin of three-fifths of them favoring Obama over Romney today. [See the “Bush/Obama” chart on this page.] The big question is whether the waning enthusiasm Millennials now show in re-electing Obama—combined with the extra fervor Silent and Boomers show in defeating him—will allow the GOP to prevail.  Nonwhite Millennials are as overwhelmingly pro-Obama in 2012 as they were in 2008 (roughly a 60 percentage point margin).  Yet Democrats should worry about the recent Pew finding that, among white Millennials, the 10 percentage point margin for Obama in 2008 has been fading away and nearly disappearing over the past year.  If young whites split anywhere close to 50-50 in 2012 (remember, non-Latino whites still comprise 60 percent of this generation), then it hardly matters what young minorities do: The GOP will possess an almost insuperable advantage. Prediction for Millennials in 2012: very large margin (20 percent) to the Democrats, led by a 4-to-1 advantage among young minorities.

It’s always great to have the young on your side. After all, youth represent the future. In the decades to come, if the Millennials stay their political course, they would confer a huge advantage to the Democratic Party. But in the next election, they are still outnumbered by two larger generations of voters (Gen X and Boom), and they may well be outworked by a more energized generation of seniors (the Silent). The young can sometimes lose elections, and lose them badly. It happened in 1972, when the Boomer youth who voted for McGovern were overwhelmed by all the midlife and senior voters (the G.I. and Lost Generations) who favored Nixon.

Two years later, of course, Nixon resigned. The age gap closed almost entirely by the next election and pretty much stayed closed all the way until 2008. As if to close the circle, many of the Millennials who now favor Obama are children of the same young “peacenik” Democrats who once voted for McGovern. That’s what makes elections so fascinating—their power to surprise and to reveal, both who are today and who we will become tomorrow.

If you do all the arithmetic with the voter shares and margin predictions cited above, you will find that my overall prediction is for a dead-even tie between Obama and Romney.  Meaning: The 2012 winner is going to have to put together a generational scorecard that is, in some combination, better than the figures I have revealed.

How likely is it that Obama or Romney will put together that scorecard?  I look at that in the next post.

PART 2

This happens often.  After I write about generational drivers or changes in the social mood, readers will contact me and ask: OK, so much for the drivers and the theory, Neil—what do you think will actually happen?

So let me try to pre-empt those readers.  In my last post, I talked about how and why different generations lean toward or against the 2012 presidential candidates.  In this post, I’ll talk about the connection between generations and some of the more conventional ways pundits currently handicap the election.  I won’t exactly say who I think will win, but I will discuss some of the indicators I am following closely.

Futures Markets.  Everyone knows that Republicans believe in futures markets (and in weird options and derivatives based thereon, like CDFs) more than anyone else.  So here’s the bad news they have to swallow: Futures markets are now predicting Obama to beat Romney by roughly 16 percentage points.  (This is not the predicted voter margin in the election; it is the probability margin by which of most investors think Obama will sneak by in at least a razor-thin victory.)  That’s 57-40 percent on Intrade or 58-42 on Iowa Futures.  Obama has been leading in these markets since last fall.  Bless those markets.  Because of the “law of one price” (look this one up under “arbitrage”), all of these futures market prices have to match, worldwide.  Even brainy liberals (see Infotopia by Cass Sunstein, ) give very high praise to futures markets.

I agree that futures markets have a great track record and need to be taken seriously.  Why do they lean more pro-Obama than the weekly polls?  Maybe they sense that the sentiment for Romney is merely the way Americans vent their anger (always at the incumbent when talking to pollsters) before settling down and voting for the incumbent after all.  Or maybe they sense that the strong preference of the rising generation for a cool and pragmatic Gen Xer as POTUS really does represent where the nation is heading—and that most voters will wake to that fact come November 6.  Young Pompey once declared (to aging Sulla) that “more people worship the rising than the setting sun.”  Maybe the markets agree.

Then again, markets no less than polls can be greatly mistaken this far away from the election.  At the very least, I think that buying a Romney contract on Intrade at $4.00 and waiting to sell it once it hits $4.50 is an extremely safe trade—since sooner or later Romney is bound to have a surge carrying him at least this far.  Even John McCain in 2008 surged in early September to 0.47 in the futures markets.  It is also possible that the markets could gradually drift to a sizable Romney advantage between now and mid-October, and that after Romney wins everyone will congratulate the markets for being so prescient.

The Economy.  According to the Pew Research Center, Romney leads Obama in his handling of one big issue, the economy, no matter how you phrase the question.  And the economy—for example, the creation of jobs and the revival of wage growth—is now far more important to voters than any other issue (environment, gay marriage, immigration, foreign policy, what have you) by a very large margin.  This is a big advantage for Romney.  The unemployment rate is now 8.2 percent; looking at current indicators, it may not decline at all between now and November.  No President since FDR has won an election with an unemployment rate over 7.2 percent.  (That was the rate in November of 1984, when Reagan won re-election; and unlike Obama, Reagan brought the rate down from the date of his first election.)  See The New York Times’ FiveThirtyEight column for a detailed update on the link between the economy and election outcomes.

The economy is as good an argument for Romney as the futures markets are for Obama.  Still, it has potential weaknesses.  Voters have yet to buy into Romney’s economic program—or even to understand it—in any big way.  Is Romney going to cut deficits faster than Obama?  Who knows?  However he runs deficits, Romney says he wants to do it more through tax cuts than spending increases.  Is John Q. Public OK with this?  Also, keep in mind the “no President since FDR” proviso.  If the public comes to equate George W. Bush with Hoover—and Obama with FDR—well then all bets are off.  FDR won as an incumbent in 1936 with an unemployment rate of 16.9% and in 1940 with a rate of 14.6%.

I agree that if the economy worsens in the next couple of months, or if we simply learn more about how bad the economy now is (at least one eminent forecasting group thinks we’re already in a recession, it just hasn’t been called yet), the news will certainly give a further boost to Romney.  But the link between each generation’s pocketbook and vote is seldom simple or direct.  The Silent Generation has done the best economically in recent years and will never bear much of the burden of large deficits, yet the Silent are the most anti-Obama.  For the Millennials, it’s the other way around.  Liberals often complain that red-zone Americans would switch parties if they only understood their own economic self-interest.  Conservatives say the same today about Americans under age 30.  The problem is, most people don’t respond to piecemeal economic incentives.  They either do, or do not, buy into a whole vision.

Likeability.  How much do you like the candidate?  How much would you like to have a beer with him?  These are the sorts of warm-and-fuzzy questions that many political analysts believe turn the tide in an election.  In most of the critical elections I can remember, GOP candidates have had the likeability advantage: Reagan over Carter; Bush Sr. over Dukakis; Bush Jr. over Kerry.  But this election, it’s tipping the other way: The Democratic candidate in 2012 is currently much more likeable than the GOP candidate.  It hardly matters what you ask—which candidate is more “friendly,” “connecting,” “honest,” “good,” “trying,” or “engaged,”—Obama comes out ahead, typically by double digits.  Likeability could be a huge plus in an era of great anxiety when many voters will want to go with their “gut.  It certainly worked for FDR.

Speaking of whom, there actually was a time when the least likeable candidate was, routinely, the Republican.  And that was the 1930s and 1940s.  Herbert Hoover and Alf Landon were less likable than FDR, and Tom Dewey was less likeable than just about anyone, including FDR and Harry Truman.  So Democrats, yes, can be likeable.  Are we reverting to the last Fourth Turning in party likeability?  Or is there a simpler explanation?  Perhaps Mitt Romney, whom nearly everyone who knows him would call him very “likeable,” has simply not yet had the chance to get his charm on in prime time.  We’ll see.

Intangibles & Wildcards.  I give most of the intangibles at this point to Romney.  He is the challenger, and it is an old maxim (though some disagree) that challengers do better late in the campaign.  A much larger share of his supporters say they are “enthusiastic” about this election—no doubt reflecting the higher relative energy of older voters this time around.  He also remains relatively unknown, which means that millions of Americans will be taking a close look at him for the first time in the ten weeks between the GOP convention and the election.  Since much of what is known about Romney thus far is negative (thanks to the attacks from his primary opponents and to the Obama campaign’s efforts to “predefine” him), it is likely that his strengths—for example, his intelligence, wit, and dedication to his family and the community—will get plenty of play.  Romney may surprise voters during the debates by coming across smarter and warmer than most voters are expecting.

Another possible plus for Romney is the “reverse coattails effect.”  Since the GOP are odds-on favorites to retain a majority in the House and gain a majority in the Senate, Romney could be pulled along by state and local candidates.  That assumes of course that most voters prefer to vote a straight ticket and have a single-party government.  It’s often said that Americans are happy with divided government, but according to one recent study a large (and possibly rising) majority say no, they really do want one party in charge.

Any intangibles for Obama?  Confidence, maybe.  Though Obama supporters are less enthusiastic, they are more likely to say they want to cast a positive vote for their candidate (as opposed to voting against the other guy) and are a lot more confident than Romney supporters that their candidate will win.  Obama must hope that confidence doesn’t morph into complacency and that his supporters are still ready to sprint.  Many pundits also say that Obama has an advantage in the electoral college by leading in the bigger states.  That could make a difference, but only if the popular vote is extremely close.

As for wildcards—meaning sudden big surprises—these usually break for the incumbent Commander in Chief, unless voters associate them with mistakes made by the incumbent.  An attack on Iran (by Israel and/or the United States, though the most likely date now mentioned in the media is October, after the election), would likely break favorably for Obama.  Seismic financial news (like a crash triggered by an impending breakup of the Euro) may not break as well, since it may persuade many voters that the world needs better global economic leadership.

Obama and Romney.  Let me conclude with a few thoughts on the two candidates themselves—and how they are, or are not, representative of their generation.

As readers of our books and this blog know, I consider Obama (born, 1961) to be a first-cohort member of Generation X (born 1961-81).  The Gen-X dates we’ve explained and defended at length elsewhere (too many books to hyperlink!).  But what about Obama?  Does he fit the basic Xer picture?  I’ve always thought so: Son of a new-age mom; child of a broken family; growing up disoriented amid incessant travel, change, and social experimentation; coming of age agoraphobic, feeling (as he puts it) “like an outsider”; and ultimately constructing his own persona (like Gatsby), a quality I see in many successful Xers.  What’s more, Obama knows he’s not a Boomer: In his books (Dreams from My Father, The Audacity of Hope), he repeatedly mentions how he feels he came along “after” the Boomers and wants to put an end to much that Boomers have done wrong (culture wars, ideological polarization, and so on).  Back in 2008, Obama often referred to this as a contrast between an earlier “Moses” generation and his own “Joshua” generation.

Obviously, opinions differ about who Obama “really” is.  I think he is at heart a canny survivor, a masterful tactician, a pragmatist who doesn’t let emotions cloud his judgment.  He knows when to play rope-a-dope (always let the GOP make the first budget move, then counter), or when to rouse his base by inveighing against Wall Street tycoons (even while hiring them to staff his Treasury), or when to ignore his own base and make a shrewd cost-benefit call (War on Terror by Predators, anyone?).  On the Boomer cusp, Obama is certainly capable of crusading oratory—which adds to his versatility.  Many of the most memorable crisis-era leaders in American history have been, like Obama, Nomad-Prophet hybrids: FDR, Abraham Lincoln, Sam Adams.  Yet clearly Obama would need a very different and far more effective second term—and another opportunity handed to him by history—to enter these ranks.

As for Mitt Romney (born 1947), no one doubts he is a Boomer.  He’s led a committed religious life; he’s always won accolades as a driven achiever; he’s made tons of money as a blue-chip yuppie; he believes in Values and Culture and Principles; and he tends to see America’s future in heavily moralistic terms (for example, in his recent book, No Apology: Believe in America, he juxtaposes his father’s “Greatest Generation” against his own “Worst Generation”—a dark figure of speech that Obama would never use).  Will his religion be a problem?  There is lots more talk about Mormonism as a Christian heresy among older than among younger Americans, that’s for certain.  Many Millennials are impressed by the strong community ethic of Romney’s LDS Church.

One mystery about Romney, though, is the impression he gives to many of his fellow Boomers that he never shared their passionate coming-of-age experience, never broke from Mom and Dad, and never drank from the same deep well of authenticity and inner fire.  We used to call this the “Dan Quayle problem.”  Boomers have never been drawn to someone who seems to paint by the numbers.  In the GOP primaries, when running against Gingrich and Santorum, Romney consistently did worse among Boomers than among other generations.

Yet in the general election, this weakness may rebound to his advantage.  In the GOP primary, Mitt Romney consistently did better with young voters than any of the other candidates (with the occasional exception of Ron Paul).  Millennials may actually like Romney’s cool and precise 7-point memo responses.  (Romney, far more than McCain, will be able to debate Obama this fall on his own Ivy-League level.)  Silent voters, similarly, may also prefer the buttoned-down Romney over the totally unplugged Boomer radical.

Yet at some point, for all of his advantages on paper, Romney will have to show some flame, some focus, and some real killer instinct.  He will have to get ahead, stay ahead, and systematically thwart his opponent’s comebacks.  In a national election, Romney has not yet demonstrated he has that endurance and resolve.  Obama has.

WORST GENERATION EVER???

Neil Howe with a new post. A Boomer telling a Millenial she is part of the worst generation ever and then describing why America isn’t the best anymore based upon the results and leadership of his generation. The irony and hypocrisy is palpable. Blaming 20 year olds for problems that really got rolling over 30 years ago is laughable. But, I would expect nothing less from Boomers.

 

“You are the Worst. Generation. Ever.”

I’ve run a few posts recently on older generations running down Millennials, so I thought—before moving on—that I ought to add this clip.  It’s from the new HBO series, “The Newsroom,” written by Aaron Sorkin (first-wave Xer, born 1961, creator of “West Wing”) and starring Jeff Daniels (Boomer, born 1955) as the cynical yet philosophical news anchor.  In this clip, Millennials are portrayed as callow, shallow, and out of their depth.  The starring Boomer, on the other hand, comes across as deep, passionate, heartfelt—and the flagrant insults he flings at his Millennial audience (e.g., “if you ever wandered into a voting booth”) would be rude only if he weren’t speaking truth to power, which in the Boomer mind justifies any manner of offensive behavior.

I’d be curious about what you all think:

 

 

One complaint about Sorkin as a screen writer is that he loves to create set-piece dialogue situations which sets up his favorite character to rhetorically vanquish an opponent, sometimes lending his shows a preachy tone.  That certainly happens here.  I’ve never in my life heard a Millennial ask a Boomer a question like, “Could you say why America is the greatest country in the world?”  That’s like pitching underhand to Ty Cobb.  As one might expect, it triggers this Boomer to unload a truckload of venom.  (His initial reluctance, I guess, makes his explosion seem more authentic.)  Did you feel you were on the side of the preacher?  Or did you feel preached at in this scene?

And what about the substance of his remarks?  Are they on target?  Here’s a Boomer who no doubt recollects America’s First Turning greatness in the 1950s with the rising G.I. Generation at the helm–when we were “number one” in everything because the rest of the world was staggering among the rubble of WWII.  But, as I recall, it was the explicit intention of the leaders of that era to raise the rest of the world up to our level of productivity, affluence, and education precisely because we thought this would make the world a safer and better place.  Among other things, we thought it would foster liberal and democratic values worldwide.  That’s why we funded the Marshall Plan and created the UN, IMF, World Bank, Bretton Woods, etc.  In terms of geopolitical power, we remain the global hegemon.  But in other respects, we are merely one of many.  Would this result have really disappointed the leaders of the American High?  Does it bother Millennials today?

One last point.  Jeff Daniels (as anchorman Will McAvoy) does not talk so much about what his own generation has done that embodies a “greater” America (though he does talk about how we once did things for “moral reasons”).  Rather, he talks mostly about what he recalls of greatness from the elders of his youth.  Here, he epitomizes the Prophet Archetype, which seldom moralizes by invoking its own deeds—but rather by invoking memories of the Heroes it recalls from childhood.  There’s a wonderful book by George Forgie (Patricide in the House Divided: A Psychological Interpretation of Lincoln and his Age) about how Lincoln’s Transcendental Generation–an extreme example of the Prophet Archetype–was forever talking guiltily about their parents’ nation-founding greatness.  They kept wringing their hands about it even as they led American into the Civil War.

Or, if you want to go back to the Ur-Model of all Prophet Archetypes, look at passages by the wise old Nestor in Homer’s Illiad.  He complains that all the Achaean warriors arrayed against Troy are mere “boys” compared to the right stuff he recalls from his own youth—the age of Jason and the Argonauts.  When I first read this passage from Nestor, it made me think of all those fake re-enactments—like Mike Tyson versus Joe Louis in his prime.  I’m suddenly thinking, did some ancient young Dorian wonder, after hearing the Nestor stanzas, about who would have won—Jason or Achilles–if they had been put in the same ring?

 

YOU’RE NOTHING BUT A WORTHLESS PILE OF SH*T!!!

Do you think General Dwight D. Eisenhower was telling these young men that they weren’t special? Was he telling them they’d never amount to anything? Was he telling them they were lazy and self involved? How do you motivate young people towards achieving great things? Do you berate them and tell them they will never achieve greatness?

Neil Howe echoes my sentiments exactly about the older generations that have ruined this country, but have the balls to blame young people who haven’t even begun their adult lives. We’ve had massive firestorm threads on this site about this exact issue. The Millenial generation has 87 million members and 60 million haven’t reached the age of 21 yet. And somehow the old cranks that have royally fucked up the futures of these Millenials with their greed, materialism, and delusion have the balls to blame the Millenials.

Will the older generations in this country ever man up and accept the consequences of their actions, or will they blame others right up to the time we thankfully put them six feet under? I have no faith that Boomers will ever step up and do what is required to leave a future for these young people. They have earned their Shallowest Generation title and will always wear it proudly.

Let the games begin.

 

“Dear Graduating Class of 2012: You Are So Not Special“

“How not special you are.”  That seems to be a popular message older people want to deliver to the young these days.  In the last couple of years, I’ve started to notice this new tough-love refrain pop up in commencement addresses.  This year, it’s really ramping up.  Apparently, when middle-aged folk tire of apologizing to the young about how badly they have messed things up—they easily move on to remind the young how unworthy they are themselves.

See in particular the pugnacious and dismissive (if not contemptuous) address penned by Bret Stephens in the Wall Street Journal a few weeks ago, which got lots of attention.  He starts out with this happy note: “Dear Class of 2012: Allow me to be the first one not to congratulate you.”  And then he goes on:

Here you are, probably the least knowledgeable graduating class in history…

To read through your CVs, dear graduates, is to be assaulted by endless Advertisements for Myself…

Your prospective employers can smell BS from miles away.  And most of you don’t even know how badly you stink.

And so on.  OK, so Stephens didn’t actually deliver this address to an actual school.  But I’m sure someone will try.

Last week, David McCullough, Jr., a high school teacher at Wellesley High School (and son of the Pulitzer Prize-winning historian) gave a lighter, wittier version of a similar message: Shape up, you’re very ordinary, and your parents’ incessant praise won’t help you now.  “You’re not special” was his repeated refrain.  The video has gone viral.  Clearly, these “speeches” have struck a chord among some of today’s Boomers and Xers, those who find young people in schools, colleges, and workplaces just too confident, too full of themselves, and too “special” for their taste.  Apparently, it’s time for older people to take youth down a few notches—for their own good.

So what exactly is going on?

At some level, I guess I’m baffled by the sudden popularity of this trope.  Here we are at a time of historically high youth unemployment during the longest and most severe economic bust since the Great Depression.  Why would anyone think Millennials need to be reminded by graybeards that history won’t give them a free pass?  Just about everyone knows, moreover, that in the decades to come Millennials are eventually going to have save more and bear higher taxes (in just about any fiscal scenario) to pay for their parents’ unfunded retirement liabilities.  And, if those programs go bust, Millennials are conveniently situating themselves in or near their parents’ households so they can help out in person.  Shouldn’t these older people want to be nicer to these kids in anticipation of what’s ahead?  Shouldn’t they be at least hoping that this rising generation is indeed special enough to handle the challenges being handed to them?

It might be different, I suppose, if these young Millennials were aggressively attacking their parents for their alleged misdeeds—like young Boomers famously and loudly assailed their own parents for raping the earth, waging colonial wars, and subjugating women and minorities.  If that were the case, today’s older generations could plead self-defense.  Yet Millennials rarely make such attacks, and certainly don’t make them at public events.  I have attended a great many commencements, convocations, and ceremonies involving high-school and college students in recent years, and in all the them Millennials thank and congratulate their parents and teachers in the warmest terms.  Never do I recall a young person saying something like, “Mom and dad, I really don’t think you are very special.”

So it’s a weird and one-sided conflict.  If Millennials wanted to attack, of course, it would be easy enough to find targets to strike–starting perhaps with their elders’ greed, short-sightedness, and blind partisanship, which have recently brought the global economy to its knees and rendered the nation’s capital ungovernable.  Yet Millennials do not strike.  They bear perhaps the heaviest burden from their elders’ malfeasance.  But they do not attack.  Perhaps because they are just too nice to get nasty.  Or because they would rather not get into a conversation with judgmental Old Aquarians who simply won’t stop arguing until they win.

Maybe, some say, this whole anti-special, tough-love line is justifiable as a natural and welcome corrective to the excesses of the “self-esteem” movement in recent years.  According to psychologist Jean Twenge, mindless cant about every person’s preciousness is turning the young into raging narcissists.  Maybe staring young people in the eye and saying, earnestly, “You are not special” will humble them, teach them a lesson, and incentivize them to try harder.

Personally, I think this is nonsense.  Sure, I understand that parents or teachers must often tell young people that they aren’t meeting a standard—and instruct them in what they must do to improve.  That’s fine.  But I don’t see any reason, ever, to tell people publicly and officially—in groups or as individuals—that they are existentially not special.  And certainly not if you are trying to motivate them to become better people.

Think about it: Why do all of the major religions (especially the monotheisms, which account for two-thirds of the world’s believers) teach that every soul, even that of the lowest sinner, is special in the eyes of God?  Is that a huge mistake?  Would these religions do a lot better by teaching that most of us are just an indistinguishable putrefying mess in the eyes of God?  Or think about great moments in history: Caesar on the eve of Pharsalus, Henry V before Agincourt, Eisenhower before D-Day.  Can we imagine King Hal rousing his motley crew by telling them that tomorrow, on Saint Crispin’s day, you will all be feeling very ordinary—because that’s really all that you are?  Or think about pedagogy.  How often have you ever heard a person say about his or her former teacher, “Yeah, he was amazing, turned my life around.  He just made me feel so unspecial.”

So how can we explain what’s going on?  I think we need to go deeper, to descend to America’s collective subconscious—and to recognize that generations sometimes give free reign to their worst instincts.

As America enters a Fourth Turning, characterized by a new mood of restraint and responsibility, older generations feel a need to exorcise their own attitudes of selfishness and habits of indulgence.  How do they do this?  Sometimes, atavistically, they do this by projecting these attitudes and habits on the young and blaming the young for them.  In the western tradition, this rhetorical response is encoded in the Jeremiad, so-called because Jeremiah (in the 7th century BCE) blamed Israel’s woes on the decadence of the chosen people in general, but especially on the corruption of the “rising generation.”  Ever since, throughout history, the Jeremiad periodically regains popularity as the need for its message arises.  In New England during the 1660s, Increase Mather responded to recurring famines by blaming the colonists, and blaming especially “the sad face of the rising generation,” whose “heathenish” and “hard-hearted” ways boded ill for their collective future.

We may indeed be hard-wired to “blame the victim” just to assure ourselves that some sort of moral order still prevails.  I know some parents who will scream at their kids for an accident they know wasn’t their fault.  No, it’s not fair, but then again the parents can (rightfully) point out that life is not always fair and their kids had better get used to it.  More optimistically, we call these “teaching moments.”

So I get why Boomers sometimes tell Millennials how unspecial they are.  It so fits their life story.  Boomers have spent a lifetime judging other generations.  Back when they graduated high school and college, their parents called them “special” and hoped for a nice conventional ceremony.  But young Boomers so often found a way to darken the mood and spoil the event.  Ditto, today—only now it’s the kids who just want to have a nice conventional ceremony.  And now it’s the parents who insist on delivering stern lectures about the selfish, complacent, and meretricious lives of a generation other than their own.  Oh, sweetie, was this supposed to be a happy moment?  Sorry!

I also get why Gen-Xers often echo the same line.  While growing up, they absorbed so many negative images of youth that many figure horrible dis-incentives are the only way kids can be motivated—from “survivor” games to “this is your brain on drugs” ads.  The very phrase “tough love” was invented in the ‘70s and ‘80s to describe the standard operating procedure for dealing with Xer kids.  My Los Angeles friend Marc Waddell has reminded me that the current anti-special message echoes the famous line spoken by Brad Pitt, in that Xer classic Fight Club: “You are not a beautiful and unique snowflake.  You are the same decaying organic matter as everyone else, and we are all part of the same compost pile.”  Throughout history, this has been the retort of skeptics, cynics, and materialists to all of the saints, seers, and visionaries.  Generationally, it has been the trademark response of the Nomad archetype to the Prophet archetype which always just precedes it.

Some Xers may also feel jealous: No one gave a damn about me when I entered college or got my first job, they recall.  So why am I required to be so solicitous toward these Millennials—with all their onboardings, parent meetings, mentorships, feedbacks, career pathway maps, and 360 reviews?  Sooner or later, Xers learn why.  Because Millennials came along at a different time.  That makes all the difference.  And as Xers raise their own kids, they understand better what motivates that difference.

The very word “special” has itself changed its meaning from one generation to the next.  During the Boomer and Gen-X ascendancy, the word “special” was increasingly used to single out individual excellence, as in the “special” academic or sports ace who in school performs better than everyone else.  Every sarcastic speech about precious youthful specialness thus contains at least one anecdote about how absurd it is that everyone on the team can receive a medal.  Echoes Wellesley High School’s McCullough, echoing everyone else: “If everyone is special, then no one is.”

But is that always true?  Imagine society veering back to a more collective understanding of “special”—something a bit more like how King Hal addressed his “band of brothers.”  Or imagine a generation of young people who, like Millennials, are more likely to reward everyone on the team simply for participating, who go back to pull forward anyone who needs help, and who don’t mind chopping up the valedictorian or homecoming award (recall the climactic scene in Mean Girls) among a large number of people?  Yes, this is a different understanding of specialness, one that has hibernated in recent decades, but surely it too has some legitimacy.  One hates to think that the few can be special only to the extent that the many are found deficient.  Or, to put it more bluntly, that heaven is rendered meaningful and desirable only by the sufferings of those in hell.

I have found that Gen-Xers in particular find it hard to imagine how feeling special can mean anything other than a sense of individual entitlement.  As managers and supervisors, therefore, their natural impulse upon encountering special-feeling Millennials is to confront them with a tough-love, drill-sergeant message: In my eyes, you maggots are not special at all!  They admit to me that this approach, when they try it, often backfires—and at best does little good.  My advice?  Don’t fight the energy.  Channel it.  Say something like this: In my eyes, you young people really do seem special—and guess what, we expect special things from you!  Most of these Xers tell me this works better, and many admit that they had never before thought much about how to leverage positive self-esteem in a collective setting.

GoldMoney. The best way to buy gold & silver

GENERATIONAL INEQUALITY

I’m working on an article about the Federal Reserve survey put out yesterday, but Neil Howe beat me to the punch. Excellent analysis of how the financial crisis has affected each generation. No wonder us GenXers are so irritable. My article will be slightly more nasty as I will focus on the culprits.

Once Again, Economy Hammers Gen-Xers and Favors the Silent

Every three years (or so), the Fed’s Survey of Consumer Finances releases a report on “Changes in U.S. Family Finances.”  It’s a goldmine of information on how families are doing financially—specifically, how their assets and liabilities and net worths are changing by various demographic categories.

Yesterday, the Fed released a new report for 2010, its first since 2007.

I anticipated that the news was unlikely to be good, given the carnage done to family financial assets and home prices during the recent Great Recession.  I suspected net worth would be down overall, and down the steepest for younger families.  I had already seen preliminary Fed estimates of 2009 data.  And I had already ruminated over the depressing Census 2010 report on income and poverty.

But I have to admit, I wasn’t prepared for results as bad as these.  Here’s the bottom line:

Net worth basically means the total assets–real and financial, including home–minus the total liabilities of every U.S. “family.”  (Though the Fed uses the word “family,” it really means households; a “family” can consist of only one person.)  In 2007, the median for all families was $126,000; in 2010, it was $77,300.  That’s a fall of 39 percent.

What happened?  The value of homes and financial assets (often in 401(k) retirement plans) crashed—and though the Dow has partially recovered, the prices of homes haven’t.  The middle 60 percent of the income distribution was hit hardest, percentagewise, for just this reason: Most of the lowest 20 percent don’t own homes, and for most of the highest 20 percent homes constitute a smaller share of their net worth.  The hardest hit region was the West (median net worth down 55 percent) mostly, again, for the same reason—homes.

Another interesting angle: The share of families with credit card debt is down, while the share with college debt is up.  For the first time ever, education loans make up a larger share of a family’s average debt than car loans—which is suggestive of where Millennials and their families are, and are not, making their investments.

But what I want to draw real attention to is the differing trends by age.  Gen-Xers and late-wave Boomers between the ages of 35 and 54 (down by 54 and 40 percent) have been hit by far the hardest.  They bought late into the real-estate market, they borrowed most against the value of their homes, and they tended to buy in the newer, faster-growing,  and exurban regions where home prices crashed the most steeply after 2006.  They also (I suspect) tended to invest their assets aggressively, as most investment managers say young adults should.  Early-wave Boomers age 55-64 (down by 33 percent) have fared a bit better.  As for Millennials and late-wave Xers under age 35, their trend (down by 25 percent) doesn’t mean much since their net worth is still so small.

But now let’s look at families age 65 and over, a group dominated by the Silent Generation.  They have done much better (down by only 18 and 3 percent).  Most of the Silent traded down from their primary residence at or near the top of the housing boom.  Most sold or annuitized their financial assets at a much better moment in the history of the Dow.  Even if they didn’t, they are more likely than Boomers or Xers to be getting retirement checks from DB (defined-benefit) corporate or government plans that are unaffected by the market.  And even if they couldn’t or wouldn’t retire, they have been less likely to lose their jobs: 65+ Americans are the only age bracket whose employment-to-population ratio has risen continuously through the recent recession.

The new Fed study looks at income as well as net worth.  Its verdict is the same as that of the annual Census reports (cited earlier): The age 65-74 and 75+ age brackets are the only ones to experience rising real median incomes between 2007 and 2010.  Families in every younger age bracket experienced substantial declines.

OK, you might say: We’re only talking about the last three years.  Things go up and down.  Maybe this is just Brownian motion.

No, it’s not.  It’s all part of a much longer trend.  Let me now show the results going all the way back to the earliest Fed reports—that is, going back to 1983, and updating everything into inflation-adjusted 2010 dollars.

As you can see, the real median net worth of every age bracket under age 55 was better off back in the early Reagan years than it is today.  (Remarkably, the situation for age brackets under age 45 never improved much after 1983.)  Over age 65, things are much better today than at any time before 2004.  And in 2010, for the first time ever, the age 75+ bracket is actually the best off of any adult age bracket.  Back in the early 1960s, by most accounts, it was the worst off.

Now let me restate these results in a fashion that makes the generational point a bit clearer.  In the following table, I express the median net worth of each bracket as a percent of the median net worth of 35-to-44 year-olds in that year.  Take a look:

Here’s the take-away.  Back in the early 1980s, when the 35-to-55 age brackets were dominated by the Silent Generation, people that age were roughly on par with the household net worth of the elderly.  Interestingly, a 50-year-old family was 39 percent wealthier than a 75+ family.  The Silent, in short, were doing pretty well—as they continued to do relative to other generations as they grew older.  Today, a 50-year-old family is 54 percent poorer than a 75+ family.

Today’s headlines on the Fed report say the median net worth of all families has fallen to 1992 values.  Which is true, averaged across all families.  But it is also true that today’s young families are doing much worse than like-aged families in 1992—and that today’s senior families are doing much better.

All of this, by the way, was long-ago predicted.  Back in 1987, the eminent demographer Richard Easterlin wrote Birth and Fortune, a book in which he tried to explain why Americans born from the late-1920s to the early 1940s (the Silent Generation) had always done so well in the economy relative to the generations that came before and after them.  Easterlin noted that one of the most remarkable features of the 1950s and early 1960s was how the typical young man at 30 could earn more than the average wage for all working men—and could certainly live better than most “retired” elders of that era.  He also noted that since the late 1970s, the economic conditions facing young late-wave Boomers had become much tougher.  Easterlin called the Silent the “Fortunate” or “Lucky” Generation, and attributed their high incomes to their relatively small numbers—pointing out that they were the product of the “birth dearth” of the Great Depression.

Bill Strauss and I always thought that the explanation lay somewhat deeper than just demography and was connected to their location in history and their archetype.  The Silent were socialized early in life to get ahead by following the rules in a fresh-built system that actually rewarded rule-followers.  This they did, and it worked.  A good Silent joke (popularized by Woody Allen) is that 80 percent of life is just showing up.  I know very few Gen-Xers who think this is true—or even funny.

In case you’re interested, here’s what Bill and I wrote about the economic future of the Silent back in our first book, Generations, published in 1991:

No American generation has ever entered old age better equipped than the Silent.  Today’s sixtyish men and women stand at the wealthier edge of America’s wealthiest-ever generation, poised to take full advantage of the generous G.I.-built old-age entitlement programs.  Armies of merchandisers and seniors-only condo salesmen will pounce on these new young-oldsters as they complete a stunning two-generation rags-to-riches transformation of American elderhood.  Where the 1950s-era elder Lost watched their offspring whiz past them in economic life, the 1990s-era elder Silent will tower over the living standards of their children.  In 1960, 35-year-olds typically lived in bigger houses and drove better cars than their 65-year-old parents.  In the year 2000, the opposite will be the case.

Now let me contrast this to what we predicted back then about the future of Gen-Xers:

Sometime around the year 2010, Xers will hit a hangover mood like that of the Lost in the early 1930s and the Liberty in the late 1760s: a feeling of personal exhaustion mixed with a new public seriousness.  The members of this forty- and fiftyish generation will fan out across an unusually wide distribution of personal outcomes, reminiscent of a night at the bingo table.  A few will be wildly successful, others totally ruined, and the largest number will have lost a little ground since the days of Boomer midlife.

Going back to these 21-year-old passages is so much fun!  Let’s not stop here.  Consider the following remarks, especially what we predicted back then about the intense protectiveness of Gen-X parents.  (Anyone catch the “Are You Mom Enough?” Time Magazine cover last week—pitched to a whole generation of attachment parents?)  Here they are:

Gen-Xers will make near-perfect fifty-year-olds.  On the one hand, they will be nobody’s fools.  If you really need something done, and you don’t especially mind how it’s done, these will be the guys to hire.  On the other hand, they will be nice to be around.  More experienced than their elders in the stark reality of pleasure and pain, Xers will have that Twainlike twinkle in the eye, that Trumanesque capacity to distinguish between mistakes that matter and those that don’t.  In business, they will excel at cunning, flexibility, and deft timing–a far cry from the ponderous, principles-first Boomer style.  In sports, the combination of Xer coaches and Millennial players may well produce a new golden era of teamwork and civic adulation.  In the military, Xers will blossom into the kind of generals young Millennial soldiers would follow off a cliff.  Their leading politicians may strike old Boomers as affable, sensible, quick on their feet–and more inclined to make deals than to argue about abstractions.

In the early 21st century, Gen-Xers will make their most enduring mark on the national culture.  Their now-mature keenness of observation and their capacity to step outside themselves will kick off exciting innovations in literature and filmmaking.  They may become the best on-screen generation since the Lost.  As parents of growing children, they will by now be too affectionate, too physical–too eager to prevent teenagers from suffering the same overdose of reality they will recall from their own youth.  In so doing, Xers will tip the scales toward overprotection of children–much as the Liberty did in the 1780s, the Gilded in the 1860s and the Lost in the 1930s.  Midlife parents (mothers especially) may hear themselves criticized by Millennials for “momming” a pliant new generation of Adaptives.

Enough wild digression.  Let’s get back to the main point of this posting.  Just-released Fed data confirms what we have always known about likely economic trajectory of today’s generations: Through the Third Turning and into the initial stages of the Fourth, the Silent will prosper, Boomers will cope with declining expectations, and Gen-Xers will get hammered.

Thoughout history, we have argued, inequality both by class and by age reaches its apogee entering the Crisis era.  Indeed, part of the historical purpose of the Crisis is tear down dysfunctional institutions, vacate positions of entitlement and privilege, rectify the inequality, and create a tabula rasa on which the rising generation can build something new.

MILLENIAL PUPPIES

Interesting article from Neil Howe. I got 9 out of 11 right on the quiz and I haven’t had a puppy in 30 years. His description of Gen X as young workers fits me to the tee. When I went into the workforce I just wanted to get the job done with no nonsense. Then I wanted to go home and play basketball or go out drinking with my friends. I required no feedback. I knew if I was doing a good job. I was self motivated. I didn’t need mission statements and rah rah HR bullshit. I still don’t.

There are quite a few Millenial workers in my office. They are all motivated and intelligent, but they do need a lot of mentoring, guidance, and hands on managing. These puppies will ultimately succeed or fail in leading this country through this Fourth Turning. Mentor them well Xers and Boomers.  

Managing Millennials… or Breaking in Puppies?

OK, prepare for a totally derivative post.  To understand it, you need to go to mentalfloss.com and take this quiz.

It all revolves around the following question: Do you know the difference between managing Millennials and raising puppies? Are you sure?  Most of the people I know who have taken this test get at least a couple of the questions wrong.

I had to laugh when I took the quiz myself.  When I talk to audiences about Millennials in the workplace–these are often audiences full of Xers and Boomers–I admit to them straight up: This is a high-maintenance generation.  They like to think of themselves as VIPs, no question.  They demand lots of structure, feedback, moral support, mentoring, and some sort of deep connection with the organization they work for.  You need to offer all of the above if you want the best of them to stick around.

It’s work–a great deal more work than the “low-swet” Xers who came along before them.  In many ways I really miss young Xers.  Their day-one attitude toward their employers was simple: You don’t ask much of us and we won’t ask much of you: Let’s just all get what needs to get done quickly and efficiently, so we can all go home.  I don’t think young Xers were ever puppies.  They seemed pretty “broken in” before they ever showed up at their first career job.

 

Yet here’s what’s really interesting: The puppiness we see in these first-wave employed Millennials is going to become a lot more exaggerated by the time we meet the Xers’ own late-wave Millennial children when they show up en masse in the workplace starting around five years from now.  Why?  Because these Xers are raising their own kids with behavioral handbooks that actually do resemble puppy-care guides.  Many Xer parents look at Cesar Milan’s “Dog Whisperers” for tips on how to be the alpha-dog in their family.  I first started writing about the new behavioralism in Xer parenting on this site a couple of years ago.  Here is an excerpt from that post:

…A lot of Boomers really wanted to change society with the way they raised their kids. And in trying to do that, they believed all that mattered was the intensity and quality of their relationship with their child and the correctness of the values they taught them.

With Xer guides, everything has changed. Xer guides are much more prescriptive, full of do’s and don’t’s, and much less attitudinal. Many of the Boomer guides looked a bit like the Whole Earth Catalogue: It showed how raising children was part of a whole world view. To Xers, hey, child rearing is just like any other technique or business–there must be a good way and a bad way to get the job done. I want to do it the good way.

Xer guides are much more scientific in the sense that the authors need to show that there’s empirical evidence favoring one way over another. Skeptical Xers don’t take advice on pure faith. Amazingly, Boomer guides rarely talked about evidence: We just “knew” e.g. that Lamaze just *must* be a vastly superior way to give birth. Just look at those Hopi designs on the book cover! (btw, I’m a big supporter of Lamaze; I just acknowledge that it was never sold to us as an evidence-based practice.)

As I’ve mentioned, Xer guides are putting a lot more stress on behavioral techniques. Dog whispering is, admittedly, an extreme example. But apt. As in so many other things, Gen-Xers know how to take their own ego out of the equation, which is what behavioral parenting requires. The whole behavioral point of view is very Xer in that it looks at the human condition as a matter of external conditioning and adaptation–a useful antidote to the endless Boomer fixation on interior motives and values.

Here is a story I hear all the time from Boomer and Silent Generation grandparents who have Xer children.  When the Xers drop off their grandkids with their grandparents–en route, perhaps, to a rare vacation alone–they typically include a list of “do’s and dont’s” and a strict schedule regarding their kids.  The grandparents express surprise, “A list?  Why do we need a list?  After all, we raised you.”  To which the Xers rejoin, “Yeah, mom/dad, that’s why we’re including the list.”

SEVEN YEARS OF COLLEGE DOWN THE DRAIN

“If you want to get laid, go to college. If you want an education, go to the library.” ― Frank Zappa

I think Frank was onto something. There is much debate going on today about whether a college degree is worth the cost. The editorial below has much truth in it. The more government has gotten involved in higher education, the more fucked up it gets. The government provides grants and low interest loans to anyone that can scratch an X on a loan document. When the crisis hit in 2008, the Federal government took complete control of the student loan program. Look what happened next.

Does that graph remind you of another graph? How about mortgage debt and home prices. It will end the same way, with you the taxpayer footing the bill for a massive write-off totaling in the hundreds of billions. Whenever the government says they are solving a problem, they are surely making it worse. Is it a good thing that anyone can get a low interest student loan? Obama and his minions wouldn’t be dishing out these loans so unemployed people will not be counted as unemployed, would he?

Student loan debt is now in the vicinity of $1 trillion. It cannot be extinguished in bankruptcy (thanks to the Boomers who hid in college during Vietnam and defaulted on their loans en masse).  As the article points out, 30% of the borrowers drop out without graduating. These people will be and are defaulting in large numbers. Those who graduate have an average debt of $25,000, with many exiting college with more than $100,000 of debt. This anchor around their necks will keep them from buying houses, starting families, and buying cars. With the Boomers unable to retire, the job market is upside down. There are fewer and fewer jobs for these graduates in their fields.

When I went to college in the 1980s it cost about $8,000 per year to go to Drexel University. It was a good college, but nowhere near one of the top schools. With my accounting degree I was able to get a $20,000 per year job with an accounting firm. Today it costs $41,800 plus another $8,000 for room and board. I commuted so my room and board was $0. It costs $50,000 per year and starting accounting jobs pay $40,000 to $50,000 per year. So the cost to attend Drexel has gone up sixfold since the 1980s, but starting salaries have only doubled. The payoff is even worse for liberal arts graduates.

The government interference, manipulation and control of the student funding market has caused the prices to skyrocket. Anyone who has taken Econ 101 should understand. The proliferation of easy low interest debt to anyone who thinks they are college material has artificially boosted demand. The supply of colleges is static. Therefore, the government created high demand, based on cheap debt, leads to much higher tuition costs. If the government was out of the equation, the number of people lured into this game would drop dramatically. Colleges would be forced to compete on price and would need to offer more financial aid. Only the best colleges would have pricing power.

This would leave the for profit publicly traded diploma mills like the University of Phoenix, Corinthian Colleges, and Career Education up a creek without a government paddle. These parasites feed off the government teat. They know how to game the Federal student loan system to maximize their quarterly profits. Educating people so they can obtain good jobs is not a priority for these lowlife institutions. They lure in the 40 year olds that have been laid off with the promise of new careers with an online education. There great at marketing, great at gaming the student loan golden calf, and not so great at getting jobs for their graduates. Do you really think the 533,000 enrollees at the University of Phoenix are getting a top notch education for their borrowed money?

They have about as much chance of getting a good job as Bluto.

“Christ. Seven years of college down the drain. Might as well join the fucking  Peace Corps.”

 

College too costly, too subsidized

Thursday, May 31,2012

WHAT PEOPLE subsidize, they get more of. Consequently, about 40 percent of Americans have college degrees, compared with 5 percent in 1940. This growth industry has been unnaturally boosted by government subsidizing higher education with direct funding and more indirectly with low-interest student loans.

This has been mistaken for progress. In reality, it is the victory of the entitlement-minded over those who foot the bill. Ironically, they often are the same young people. As with all income-redistribution schemes, it has unpleasant, unintended consequences.

Almost everyone now realizes living off borrowed money is one of the causes of today’s faltering economy. Bills come due. They don’t always buy what was intended.

Home mortgages inflated to reckless amounts and credit card debt buried consumers. They provided short-term joy rides, only to become great financial burdens. Defaults are economically damaging. Lenders lose, borrowers lose and the economy eventually self-corrects with contractions, as seen in recent years.

The more than $1 trillion in student loans is another symptom of short-sighted appetites for instant gratification, oblivious to long-term consequences. These debts, much like government-subsidized and incentivized mortgages, have ballooned to ruinous levels.

COLLEGE ENROLLMENT is up 38 percent in the past decade. More than 20 million people are enrolled. Some students amass six-figure loan debts by graduation, and too often can’t even find a paying job.

Nearly 30 percent of college students with loans drop out. Dropouts, according to the Education Sector think tank, are four times more likely to default on their loans. Many students who stay in college increase likelihood of default by working to meet expenses. That requires taking fewer courses, lengthening their stay but decreasing odds of graduating.

Much of this problem results from the misguided notion that anyone who can pick up a pencil should attend college. As columnist Robert Samuelson wrote in the Register, “We overdid it. The obsessive faith in college has backfired.” As Register editorial writer Mark Landsbaum previously noted, “Not only is a college education not necessarily all it’s cracked up to be, it’s not as necessary as you’ve been led to believe.”

Government-backed loans and subsidies encouraged colleges to accept more students because tuition is paid upfront, unlike tuition debts. The result is completely unwarranted enrollment numbers.

VOCATIONAL EDUCATION has been downplayed and bad-mouthed. Even in our high-tech culture, 69 percent of jobs don’t require post-high school degrees, the government says. To admit more students, entrance standards were lowered. “We’ve dumbed down college,” Mr. Samuelson wrote.

“Forty five percent of college students hadn’t significantly improved their critical thinking and writing skills after two years,” concluded the authors of a book, “Academically Adrift.”

Unfortunately, the herd mentality persists, urging and luring ever more young people onto campus, instead of creating new vocational and tech opportunities and private-sector apprenticeships. Living off borrowed money remains attractive, at least until the bill comes due, especially for the unemployed.

— The Orange County Register

THOSE “SOFT” MILLENIALS

The Millenial Generation is between the ages of 7 years old and 30 years old today. There are approximately 87 million of them and 60 million of them are still under 21 years old. I find it hysterical that old codgers that have been responsible for leaving this country in such a shambles have the balls to scorn and ridicule this generation before they have even started their adult lives. Actually I find it disgusting and revolting. But I expect nothing less from the Shallowest, Greediest Generation. I’m sure I’ll get the usual response about Millenials being soft, playing X-box, and not amounting to a hill of beans.

Well, it seems there are about 30 million Millenials between the ages of 18 and 30. That happens to be the prime cannon fodder age. Here is what the “soft” millenials have done over the last ten years or so:

  • 6431 American soldiers have died in Iraq and Afghanistan.
  • Approximately 4,000 of these soldiers were Millenials.
  • 47,545 American soldiers have been badly wounded in Iraq and Afghanistan.
  • Approximately 30,000 of these soldiers are Millenials.

It seems that these soft Millenials are doing the majority of fighting and dying for this country. Not too many Boomers in the casualty counts. But, they do seem to have created the brilliant strategy that has resulted in the Millenial casualties.

 Below are pictures of some of our fallen heroes. It is just one page of soldiers that have died for you. I suggest you visit this website:

http://apps.washingtonpost.com/national/fallen/

You can go through the 96 pages of pictures. And the next time you think about ridiculing, scorning or bad mouthing the Millenial generation, remember that more than 60% of these heroes are from that generation. Have a nice day.

 

Jorge Velasquez Alejo Thompson Chase Marta Jacob Schwallie Dustin Gross Thomas Fogarty John Huling Gregory Childs Zachary Hargrove Junot Cochilus David Rylander Bruce Clark Nicholas Dickhut Christian Sannicolas Scott Pruitt Dick Lee Jr. Christopher Mosko Brandon Eggleston Jason Edens Andrew Brittonmihalo Benjamin Neal Moises Gonzalez Manuel Vasquez Jonathan Walsh Michael Metcalf Joseph Frankhauser Dean Shaffer Nicholas Johnson Don Viray Michael Braden Aaron Faust David Nowaczyk Tanner Higgins Ramon Kaipat Philip Schiller Ramon Kaipat Trevor Stanley Antonio Burnside Alex Martinez Shawn Hannon Jeffrey Rieck Nicholas Rozanski Christopher Bordoni Christopher Brown Tyler Smith Jeffrey White, Jr. James Dutton Roberto Cazarez Michael Palacio David Taylor Johnathon Davis Francis Imlay Joseph D?Augustine William Wilson III Aaron Istre Daniel Brown Dennis Weichel Jr. Jamie Jarboe Clovis Ray Daquane Rivers Jesse Grindey Edward Acosta Payton Jones Jordan Bear Conner Lowry Robert Marchanti II John Loftis Joshua Born Timothy Conrad Jr. Allen McKenna Jr. Ryan Hall Nicholas Whitlock Julian Scholten Justin Wilkens Paris Pough Jerry Reed II Cesar Cortez Osbrany Motes De Oca Billy Sutton Terence Hildner Edward Dycus William Stacey David Johnson Joshua Pairsh Christopher Singer Daniel Bartle Travis Riddick Jesse Stites Kevin Reinhard Nathan McHone Joseph Logan Keith Benson Phillip McGeath Kenneth Cochran

MILLENIALS RISING

Time is growing short for the status quo. The existing social order will be swept away. The Establishment will be discredited. The guilty will be found and punished. There will be blood. The revolution will not be led by Boomers. They are the status quo. They are calling the shots today. They are fearful and are lashing out at the younger generations. The Millenials are rising. Every day more enter young adulthood, while more Boomers die. The scale is tipping. The moment of truth is approaching. It may not be today or tomorrow, but it’s coming. Fourth Turnings NEVER reverse course. Winter is here.

As a bloody skirmish between police and opposition activists in central Moscow was drawing to a close on Sunday a small boy on a tiny bicycle pedaled through the crowd and approached a line of hulking riot police.

He sat there for a moment, balancing on his training wheels, staring at the menacing troops who were decked out in blue camouflage uniforms and full riot gear, nightsticks at the ready.

A group of protesters who had been heckling the cops began jeering, “Here’s the guy that will storm the Kremlin. Be ready boys! Here he comes!”

Julia Ioffe, the Moscow correspondent for The New Yorker and Foreign Policy magazine, happened to be standing right behind him. She whipped out her iPhone and snapped a picture which she tweeted out to her over 6,000 followers with the caption “Russia’s Tianamen (sic) image.”

THE WAR AGAINST YOUTH

OUCH!!!!

Boomers ain’t gonna like this one.

Hat tip to my Millenial friend Harry Jarin for sending me the link.

 

The War Against Youth

The recession didn’t gut the prospects of American young people. The Baby Boomers took care of that.

By Stephen Marche

 

James Victoire

Published in the April 2012 issue

Twenty-five years ago young Americans had a chance.

In 1984, American breadwinners who were sixty-five and over made ten times as much as those under thirty-five. The year Obama took office, older Americans made almost forty-seven times as much as the younger generation.

This bleeding up of the national wealth is no accounting glitch, no anomalous negative bounce from the recent unemployment and mortgage crises, but rather the predictable outcome of thirty years of economic and social policy that has been rigged to serve the comfort and largesse of the old at the expense of the young.

Since the beginning of the Industrial Revolution, human potential has been consistently growing, generating greater material wealth, more education, wider opportunities — a vast and glorious liberation of human potential. In all that time, everyone, even followers of the most corrupt or most evil of ideologies, believed they were working for a better tomorrow. Not now. The angel of progress has suddenly vanished from the scene. Or rather, the angel of progress has been sent away.

Nobody ever talks about generational conflict. Who wants to bring up that the old are eating the young at the dinner table? How are you going to mention that to your boss? If you’re a politician, how are you going to tell your donors? Even the Occupy Wall Street crowd, while rejecting the modes and rhetoric and institutional support of Boomer progressives, shied away from articulating the fundamental distinction that fills their spaces with crowds: young against old.

The gerontocracy begins at the top. The 111th Congress was the oldest since the end of the Second World War, and the average age of its members has been rising steadily since 1981. The graying of Congress has obvious political ramifications, although generalizations can be deceiving. The Republican representatives tend to be younger than the Democrats, but that doesn’t mean they represent the interests of the young. The youngest senators are Tea Party members, Mike Lee from Utah and Marco Rubio from Florida (both forty). Here’s Rubio: “Americans chose a free-enterprise system designed to provide a quality of opportunity, not compel a quality of results. And that is why this is the only place in the world where you can open up a business in the spare bedroom of your home.” He is speaking to people who own homes that have empty spare bedrooms. He will not or cannot understand that the spare bedrooms of America are filling up with returning adult children, like the estimated 85 percent of college graduates who returned to their childhood beds in 2010, toting along $25,250 of debt.

David Frum, former George W. Bush speechwriter, had the guts to acknowledge that the Tea Party’s combination of expensive entitlement programs and tax cuts is something entirely different from a traditional political program: “This isn’t conservatism: It’s a going-out-of-business sale for the Baby Boom generation.” The economic motive is growing ever more naked, and has nothing to do with any principle that could be articulated by Goldwater or Reagan, or indeed with any principle at all. The political imperative is to preserve the economic cloak of unreality that the Boomers have wrapped themselves in.

Democrats may not be actively hostile to the interests of young voters, but they are too scared and weak to speak up for them. So when the Boomers and swing voters scream for fiscal discipline and the hard decisions have to be made, youth is collateral damage. Medicare and Social Security were mostly untouched in Obama’s 2012 budget. But to show he was really serious about belt tightening, relatively cheap programs that help young people like the Adolescent Family Life Program and the Career Pathways Innovation Fund were killed.

His intentions may be good — he may want to increase support for AmeriCorps — but the program shrunk last year. Three quarters of the applicants were turned away. He resisted Republican efforts to slash Pell grants by $845 per student, but then made other changes to the program that will save the government — or cost students, depending on your perspective — a projected $100 billion over ten years.

The youth vote still supports Obama, but in a chastened, conditional way. In hindsight, Obama’s 2008 campaign looks like an indulgent fantasy in which the major conflicts in life simply don’t exist. There may be no white America and no black America, no blue-state America and no red-state America, but one thing is clear: There is a young America and there is an old America, and they don’t form a community of interest. One takes from the other. The federal government spends $480 billion on Medicare and $68 billion on education. Prescription drugs: $62 billion. Head Start: $8 billion. Across the board, the money flows not to helping the young grow up, but helping the old die comfortably. According to a 2009 Brookings Institution study, “The United States spends 2.4 times as much on the elderly as on children, measured on a per capita basis, with the ratio rising to 7 to 1 if looking just at the federal budget.”

The biggest boondoggle of all is Social Security. The management of entitlement programs, already weighted heavily in favor of the older population, has a very specific terminal point that coincides neatly with the Boomers’ deaths. The 2011 report by the Social Security trustees estimates that, under its current administration, the fund will run out in 2036, so there’s just enough to get the oldest Boomers to age ninety.

Only 58 percent of Boomers have more than $25,000 put aside for retirement, so the rest will either starve or the government will have to pay for them. But the government’s future ability to pay is decreasing rapidly precisely because the Boomers splurged so heavily during the Bush and Clinton years. Public debt per person in the United States currently stands at $33,777. George W. Bush inherited a public-debt-to-GDP ratio of 32.5 percent and brought it up to 54.1 percent during a period of economic growth. (The money borrowed from the future paid for massive tax cuts, with no serious reductions in domestic spending, two expensive wars, and a prescription-drug benefit added to Medicare.) Under Obama, the debt-to-GDP ratio has risen to 67.7 percent and is projected to rise to 74.2 percent this year.

This is no conspiracy; no nefarious backroom deal by political and corporate overlords. The impasse of the moment is, tragically, the result of the best aspects of the Boomers’ spirit. The native optimism that emerged out of the explosively creative postwar world led them to believe that growth would go on forever; that peace and prosperity were the natural state of things. Their good intentions seem like willful naivete today, but the intentions were genuine. Clinton actually believed that globalization would export the First World rather than bring the Third World home; it did both. The prescription-drug benefit was the “compassion” in compassionate conservatism. All those tax cuts were intended to liberate opportunities, not destroy them.

Cynicism rises to fill the emptied space of exaggerated and failed hope. It’s all simple math. If you follow the money rather than the blather, it’s clear that the American system is a bipartisan fusion of economic models broken down along generational lines: unaffordable Greek-style socialism for the old, virulently purified capitalism for the young. Both political parties have agreed to this arrangement: The Boomers and older will be taken care of. Everybody younger will be on their own. The German philosopher Hermann Lotze wrote in the 1870s: “One of the most remarkable characteristics of human nature is, alongside so much selfishness in specific instances, the freedom from envy which the present displays toward the future.” It is exactly that envy toward the future that is new in our own time.

And we will not talk about any of it. We will keep mum. We will hold our tongues lest we seem ageist, lest we seem bitter, lest we seem out of touch, lest we seem pessimistic, lest we seem divisive.

HOW TO DISENFRANCHISE A GENERATION:

Across the country, state branches of the Republican party are making a thinly veiled attempt to disenfranchise the young through “voting reform.” The trick is simple: Require government-issue photo ID before allowing somebody to vote. Eighteen percent of young voters don’t have current photo IDs. Scott Walker in Wisconsin has signed this “reform” into law. So has Rick Perry in Texas. Similar new rules are going forward in roughly thirty other states. Restricting out-of-state IDs is a natural next step, already under way: That way, thousands of college students won’t be able to vote. The Advancement Project, a civil-rights advocacy group, calls the move “the largest legislative effort to scale back voting rights in a century.”

Let’s say you just graduated from high school.

College, right? You have to go to college. That’s not just what your career counselor told you. That’s in the numbers. If you go to college, you’re significantly less likely to lose your job. The pay of college graduates has risen over the past twenty-five years and everybody else’s pay has declined. Which curve do you want to be on?

And yet, at the exact moment when an education has never been more necessary, education is increasingly out of reach. From 1980 on, the price of attending a four-year college has risen by 128 percent. While the price has spiked, the quality has tanked. Students at college in 2003 did two-thirds the homework that students in 1961 did. In a survey published in 2011, 45 percent of students showed no improvement in “critical thinking, complex reasoning and writing” after two years of college. You did not read that incorrectly: That’s no improvement. None. And how could the results be any different? Three decades ago, 43 percent of professors were adjuncts. Now, with colleges bloated by older, tenured professors who take up huge slices of academic budgets while teaching crumbs of courses, the vast majority of classes are taught by adjuncts. On college campuses, the supposed hotbeds of liberalism, the young are instructed primarily in the mechanics of crony capitalism.

Once you’re out of college, you’ll have to intern. Again, no choice. The practice of not paying young people for their labor has become so ingrained in the everyday practice of American business that we’ve forgotten how bizarre and recent the development is. In the early 1980s, 3 percent of college grads had had an internship. By 2006, 84 percent had done at least one. Multiple internships are common. According to a survey by the National Association of Colleges and Employers, more than 75 percent of employers prefer students who have interned or had a similar working experience.

Employers have feasted on despair — and these aren’t internships for struggling small presses or rarefied design companies. Subsidiaries of General Electric, a company worth $200 billion, employ them regularly as an “important recruiting tool.” Disney uses eight thousand of them in dismal working conditions. Jennifer Lopez Enterprises uses them. So does The Daily Show. So does the pope. And because internship programs are sheltered from the violation of labor laws by the complicity of universities that give students “credit” for them — as long as the students pay thousands of dollars for those credits — American companies can operate these programs for the most part hidden from scrutiny. The best study of intern life in America found that companies save annually around $2 billion from pseudo-employment.

But maybe you’re an overachiever — instead of interning, you want to get a master’s or a professional degree. With entry to the professions comes another opportunity to be taken advantage of, and it’s not just the inherently ridiculous price of a creative-writing M.F.A. or journalism school, where on some level, everybody understands the students are being played for suckers. The cost of medical school has spiked over the past three decades. In 1981, average medical-school debt was less than $20,000. Today it is $158,000. Law-school tuition rose 317 percent between 1989 and 2009 while American laws schools wildly increased the number of lawyers they graduate. Naturally, a glut of lawyers decreases their value. So kids pay more for a worse education that leads to lesser prospects in order for the schools to prosper temporarily. Even for doctors and lawyers, an accrual of property or any rise in net worth happens much later in life than it did twenty years ago. The standard debt-repayment plan for physicians is ten years, but twenty-five is a commonly accepted option. For the new professional class today, life begins at forty. That’s not just an expression.

And if you didn’t take your high school advisor’s advice to go to college? Well, you should have listened. What goes for the white-collar young person applies even more ferociously to the blue-collar world, or what’s left of it. The nature of the generational setback for unionized labor can be summed up in a single devastating phrase: New workers will earn a “globally competitive wage.” Manufacturing jobs, having been exported to the Third World, are now returning to America at Third World rates. Newer workers at unions across the country earn ten to fifteen dollars an hour less than established workers, and the unspoken but widely reported understanding with the AFL-CIO is that the wage of these workers will not increase. In other words, Boomer workers make almost double what their young counterparts do, and will continue to do so regardless of how long a young worker stays in the same job. As one older worker in one of these bifurcated factories told The New York Times, by the time the young reach their maximum earning, their elders “won’t be here any longer to remind them of what they are missing.”

Government, academia, the professions, corporations, unions, and both political parties — all continue to mine the vulnerability of youth in service of the needs of their aging power base. Separately, each of these cases would amount to a minor scandal, but taken together they point to a broader and more significant alteration to the way of the world. From every corner of the institutional spectrum, the whole of American society has been rearranged so that the limits of vision coincide exactly with the death of the Boomers.

Nobody wants this. The Boomers did not set out to screw over their kids. The wind just seemed to blow them that way. But no matter what their motivations, a painful truth grows truer with every passing year: Through its refusal to act, the generation in power is willing to do what other generations before them would not — sell their children’s birthright for a mess of their own pottage.

 

 

WHAT’S HAPPENING IN AMERICA IS HAPPENING EVERYWHERE ELSE:

 

A generation now means an economic cohort — a moment in the cycle of rising and (mostly) falling economic data. The UK has 21.8 percent youth unemployment, France 22.8 percent, Hungary 26.1 percent, Italy 28.2 percent, Spain 47.8 percent. Around the world, young people are beginning to be defined by their unemployment: the mileuristas of Spain, “those who earn less than a thousand euros”; the NEETs of England, “not in employment, education, or training”; the hittistes of Tunisia, “those who lean against the wall.” Revolutions or unmanageable riots have inevitably followed the rise of masses of bored, underemployed young people.

 

Many claim that the young deserve their fate: They’re entitled, they have too many choices. They don’t know what they want. They’re getting themselves into debt. They don’t know how good they have it.

These criticisms are convenient, but also demonstrably incorrect. Defining generations by cultural attributes or values, almost always done with unrepentant shallowness, is the stupidest thing that commentators do. However, a recent study from the National Center for Education Statistics comparing high school seniors in 2004 (who are in their mid-twenties today) with high school seniors in 1972 (now in their late fifties) is useful and practical.

The breakdown is rather stark: Two thirds of the Boomers thought “being able to give their children better opportunities” was important; 8 percent wanted to live close to their parents; 18 percent believed that making money mattered; 27 percent cared about social problems. The students in 2004: 83 percent claimed that the opportunities of their children were very important; 25 percent wanted to live close to their parents; 35 percent were serious about making money; and 20 percent cared about social problems.

Compared with their parents, high school kids who graduated from college into the teeth of the recession are a Republican fantasy. They want a good job in order to raise a family, and it’s exactly that arrangement that is going to be denied them. The deal they were promised, that if you work hard and make smart choices you will have a good life, is not working out. A Great Disappointment will no doubt follow.

Everyone currently emerging into the workplace will be economically scarred for life by the misfortune of their timing. The initial wage loss for a worker emerging in a bad economy is 6 to 7 percent for every 1 percentage point increase in the unemployment rate, which means a twenty-one-year-old starting a job today makes about 24 percent less than he or she would have five years ago. After fifteen years, even during the good times, the wage loss still hovers at around 2.5 percent.

A more profound shift is under way, though. Currently the average American parent spends 10 percent of his or her annual income on their adult children, regardless of income. Meanwhile, one in four young Americans recently moved back home with their parents after living apart. Calling them the Boomerang generation implies that it’s the irresponsible, feckless children who don’t have it together enough to leave the nest. But many children who live at home have jobs. So we have children living with their parents after they have income, just like they did in the early parts of the twentieth century and before. The idea of youth as a time of freedom and self-discovery will last exactly one generation, it seems.

People who want to join society will do so through an increasingly lengthy period of humiliation and struggle, and only through the help of their parents. Even before the recession, that was more or less true. It’s the dirty little secret of every middle-class person in their mid-thirties: Everybody’s parents helped them out. Who do you think is paying for all those summer internships? How many new parents do you think actually have enough money for a Bugaboo stroller, let alone a down payment on a first home? And if you don’t have a mom or dad who can help with ballet lessons for the kids or family vacations, God help you. America is becoming what it was founded to reject, what it has resisted throughout its history, a patronage society.

The situation is obviously unsustainable: At the exact moment when the United States and all other Western countries are trying to deal with aging populations, they are failing to capture the energy and potential of the people who will have to work to support those aging populations. We have arrived at a moment, just before the 2012 election, in which the hedges, the corner-cuts, the isolated decisions about young people from a host of institutions have accrued to the point of a continuous catastrophe. The question rises from the wreckage: How long can you eat the young?

Get ready for the summer. It’s going to be hot.

Youth should be the only issue of the 2012 election, because all the subsidiary issues — inequality, the rising class system in America, the specter of decline, mass unemployment, the growing debt — are all fundamentally about the war against young Americans. But the choice young Americans face is between a party that claims to represent their interests but fails to and a party that explicitly opposes their interests and actively works to disenfranchise them.

The protesters, the occupiers, the kids who screamed themselves hoarse in the parks of New York and Oakland last year have spent the winter nestled underground nurturing their strategies. Has there ever been a movement so full of people who don’t want to be there, who would rather be working?

Around the world, the response to chronic youth unemployment has been consistently traditional. The Arab world takes to the streets the way it did in the 1950s. Italy returns to its antique paterfamilias. England goes into its standard mode of underclass rioting. And what’s happening in the United States would be instantly recognizable to any progressive of the 1930s.

By bus and train and car pool, they will follow the gerontocracy to Tampa and Charlotte, the cities with the utter misfortune of hosting the presidential nominating conventions. Then we’ll see if the people inside the convention centers can find the youth anything better to do.

We’ll see then how the flowers of rage, planted and nurtured so carelessly for three decades, have sprung up and who will harvest them.

—
Sources: Pew Research Center; Urban Institute; Project on Student Debt; Eurostat; Bureau of the Public Debt; Brookings Institution; Department of Education; National Center for Education Statistics.



WILL BOOMERS END UP EATING ALPO?

Another good article from http://www.mybudget360.com/.

At this point it doesn’t matter whether you were lured into the fantasy of a cushy retirement by Wall Street shysters or you decided to live for today with a leased BMW and a McMansion twice the size of what you needed or you thought you could retire off your internet stock profits and never ending equity in your house or you were just a dumbass and forgot to save for your retirement – YOU’RE PRETTY MUCH SCREWED. Stocks aren’t going up in the next decade. Bonds will fall in the next decade. And most of the Boomers have less than $100,000 saved for retirement. I hope they like the taste of Alpo.

Middle class retirement now largely a postcard fantasy – How Wall Street fabricated a buy and hold fairytale and jumped ship with taxpayer golden parachutes. Did baby boomers think about who they would be selling those 401k and pension stocks to?

The days of dreaming about long days playing golf on a green course and taking luxurious cruises around the world are appearing more and more like a foggy memory for those in the middle class planning for retirement.  As Wall Street bankers and hedge fund managers rob the public blind, the mission statement sold to baby boomers is starting to become a large bait and switch catchy enough to make it on a Hallmark card.  For decades Wall Street begged and lured the public in either directly or through pension funds into their web of easy money.  Save $100 a month and you’ll retire a millionaire!  As it turns out, the golden parachute was only available to a tiny fraction of the population while the oligarchy in the financial sector offloads their toxic bets onto the taxpayers struggling balance sheet.  The end game?  No retirement.  At least no retirement like those plastered on glossy mutual fund brochures.  What the Wall Street banking charlatans failed to tell you is that you eventually need to sell those stocks to use the money for real world spending.  What they also failed to mention is that the baby boomer generation is now going to sell into unrelenting headwinds of demographics bringing on a younger and poorer generation to purchase their stocks.  Of course Social Security is in the crosshairs of the financial elite since they already secured their financial piece of the pie.  You know things are bad when the Federal Reserve is stating that stocks are not exactly a winners bet in the years going forward.

Retirement becoming more of a postcard fantasy

The middle class has been pillaged and ransacked by financial thievery for decades.  The debt bubble and mass delusion is now imploding.  The graft and con games taking place in the financial sector would be comical if they weren’t so real and economically tragic.  The Federal Reserve has given covert loans to big banks while big banks publicly stating all was well.  The Federal Reserve has grown their balance sheet to a stunning $2.8+ trillion of questionable assets and other junk with little redeemable market value.  It would have a hard time selling these items on eBay let alone the natural marketplace.  There is no easier way to make a profit than stealing from the taxpayer.  Of course the problems in the system are coming at the expense of the working and middle class.  For those who bought into the Wall Street mantra of buy and hold, making a profit has gotten much harder:

annualized rate of returns

This is fascinating data to look at.  This decade has been horrible for stocks.  The S&P 500 stands today where it did in 1998.  The massive stock volatility is simply a reflection of the problems deep in our financial system.  The above chart examines P/E ratios over time.  Really fascinating information but the Fed study finds that P/E ratios are likely to go lower because of demographic shifts and also the reality that we have a lower wage employment force dominating our economy.  The latest decade is a reflection of the bubble era machinery that has hoisted up the financial sector into an untouchable corner yet middle class Americans have taken it squarely in their stock portfolios.  Why?  Because Wall Street has been preaching buy and hold as if it were some patriotic mission but many of these hedge funds and banking managers have placed bets that openly aim against American middle class success.  In fact, some have made bets on flat out American failure and have made billions of dollars with lower tax rates that are given to hedge funds.

The stock market casino

The stock market has been on a wild ride for well over a decade:

PE Expansion Contraction

Source:  Mish Global Economic Analysis Blog

You have a crazy expansion in the 1980s and 1990s with the peak productive years of baby boomers but also the carefree attitude with the debt bubble and the “deficits don’t matter” mentality that has harmed this nation and is leaving the Eurozone in tatters.  Of course all of that has come to a crashing halt first with the tech bubble bursting and then the real estate bubble imploding.  So you have to ask, when these baby boomers sell out of their 401ks and pension plans who will buy the stocks?  The 46,000,000 Americans on food stamps?  Or what above the average per capita worker making $25,000 a year?  Household incomes have been stagnant for well over a decade:

real-household-median-income1

To use an often quoted cliché, this is the perfect financial storm.  For the financially and politically connected the free market rules do not apply.  For the working and middle class they do.  This massive contraction is happening when millions are entering the retirement pipeline.  Now it would be one thing if people had vibrant retirement accounts.  1 out of 3 Americans have no savings account.  But for those with a retirement account they likely do not have funds to support their life as they age and this is seen in a Transamerica retirement study:

“Workers estimate their retirement savings needs at $600,000 (median), but in comparison, fewer than one-third (30 percent) have currently saved more than $100,000 in all household retirement accounts.”

And the fears most have are based on real life issues:

retirement fears

Source:  Transamerica

These aren’t fears about not having enough yachts or trips to Paris but whether they will eat decent food or Alpo.  Workers are accurate in how much they need but less than one third have even saved $100,000 or more for retirement.  For a median household income pulling in $50,000 a year in working years, the funds would likely last 3 or 4 years.  The biggest fear is outliving the money while coming in at a close second is simply not meeting basic family needs.  The next fear is cuts to Social Security because of course, the bankers and investment banks had to get their bailouts first before setting the U.S. economy on fire.

The Federal Reserve study found that P/E ratios are likely to become compressed as time goes on:

pe ratios moving forward

“Between 1981 and 2000, as baby boomers reached their peak working and saving ages, the M/O ratio increased from about 0.18 to about 0.74. During the same period, the P/E ratio tripled from about 8 to 24. In the 2000s, as the baby boom generation started aging and the baby bust generation started to reach prime working and saving ages, the M/O and P/E ratios both declined substantially. Statistical analysis confirms this correlation. In our model, we obtain a statistically and economically significant estimate of the relationship between the P/E and M/O ratios. We estimate that the M/O ratio explains about 61% of the movements in the P/E ratio during the sample period. In other words, the M/O ratio predicts long-run trends in the P/E ratio well.”

In other words, lots of money chasing the Wall Street illusion yet there will be fewer (poorer) buyers ahead.  The P/E ratios surged when baby boomers entered their peak earnings years.  Given the massive problems in our economy the fact that P/E will take it on the chin is no surprise.  What is more stunning is the fact that no real financial reform has taken place and that the political system is so utterly broken.  Money has infiltrated politics to a degree never before seen.  We have career politicians in the SEC basically training for plush gigs at Goldman Sachs or Morgan Stanley.  A revolving door out of D.C. and into big investment banks and back to D.C.  No wonder why there has been no true enforcement of the investment banks when many are simply using it as a training ground for future jobs!  If the working and middle class actually saw what went on trading floors they would never even think about playing the stock market.  The fact that we have millions now needing to dump stocks into the open market is simply another issue we will be facing.  These are people that have to sell (you can’t eat your stocks or pay for a medical bill with a stock).  Many are now realizing after a lifetime of work that retirement only meant more work with fewer benefits to compensate for the big banking bailouts.

BERNANKE PLEDGES TO SCREW YOUR GRANDMOTHER FOR AT LEAST TWO MORE YEARS

“A system of capitalism presumes sound money, not fiat money manipulated by a central bank. Capitalism cherishes voluntary contracts and interest rates that are determined by savings, not credit creation by a central bank.” – Ron Paul

  

I wonder what goes through Ben Bernanke’s mind as he sits in his gold plated boardroom in the majestic Marriner Eccles building in Washington DC and decides to screw grandmothers in order to further enrich Wall Street bankers. He just pledged to keep interest rates at zero percent for two more years. Ben is a supposedly book smart man. Does he have no guilt or shame for what he has wrought? How does he sleep at night knowing he has created bloody revolutions around the globe due to his inflationary zero interest policy? People are dying because he has decided that an elite group of Wall Street bankers who recklessly brought down the worldwide financial system in 2008 deserve to be kept alive and enriched at the expense of the many.

He uses words like transitory to describe inflation. Even as the price of gold reveals his lies he continues to promote policies that will lead to the demise of the USD and our economic system. There is only one way to counter his lies – truth. With a corporate fascist government run by the few for the benefit of the few, telling the truth is treason as stated by Ron Paul:

“Truth is treason in the empire of lies.”

The storyline being sold to you by Bernanke, his Wall Street masters, and their captured puppets in Washington DC is that deflation is the great bogeyman they must slay. They make these statements from their ivory jewel encrusted towers as the real people in the real world deal with reality. The reality since Ben Bernanke announced his QE2 policy in August 2010 is:

  • Unleaded gas prices are up 45%.
  • Heating oil prices are up 46%.
  • Corn prices are up 71%.
  • Soybean prices are up 26%.
  • Rice prices are up 13%.
  • Pork prices are up 31%.
  • Beef prices are up 25%.
  • Coffee prices are up 38%.
  • Sugar prices are up 48%.
  • Cotton prices are up 13%.
  • Gold prices are up 42%.
  • Silver prices are up 115%.
  • Copper prices are up 23%.

These are the facts and they fly in the face of the lies being spouted by Bernanke and his Federal Reserve cronies. Words like transitory, quantitative easing, extended period, and liquidity are used by Professor Bernanke to obscure what he is doing to the average American. He lives in a world of theories and models, while the rest of us live in the real world, where theories kill and impoverish millions. There are 40 million Americans over the age of 65 today. You might even know a few of them. There will be 10,000 people per day joining their ranks for the next nineteen years as the Baby Boomers retire en masse. The vast majority of these senior citizens are risk averse. Some disturbing facts reveal the true picture for seniors today:

  • Most senior citizens do not have a traditional pension plan because they have been going out of style over the past 30 years.  In 1980, some 39% of private-sector workers had a pension that guaranteed a steady payout during retirement. Today that number stands closer to 15%, according to the Employee Benefit Research Institute in Washington, D.C. 
  • 35% of Americans already over the age of 65 rely almost entirely on Social Security payments alone. 
  • Approximately 3 out of 4 Americans start claiming Social Security benefits the moment they are eligible at age 62.  Most are doing this out of necessity. This probably has something to do with the fact that the median retirement savings of households over the age of 65 is less than $45,000.   
  • The median household net worth of all Americans fell from $97,000 in 2005 to $70,000 in 2009. The median household net worth of households over 65 years old fell from $200,000 in 2005 to approximately $150,000 in 2009. Two thirds of seniors’ net worth is the equity in their primary residence, meaning they have $50,000 or less of financial assets (cash, stocks, bonds). 
  • 20% of all the households in the United States have zero or negative net worth.  

This data sets the scene for the crime of the century committed by Ben Bernanke and his co-conspirators on the Federal Reserve Board. The easiest way to understand how Ben has screwed seniors and savers to pay off his Wall Street and K Street benefactors is to use a real life example.

A seventy five year old widow living in her paid off row home, bought in 1955, gets by on her annual social security income of $17,000 and the income generated from the $125,000 in retirement savings left from her husband’s forty years working as a truck driver. She is a child of the Depression, financially unsophisticated and risk averse. This describes most senior citizens. The widow and her late husband were only comfortable investing their money in CDs and money market funds. In 2007, before the Wall Street created financial collapse, savers and risk averse senior citizens could earn 5% in a money market fund, 5.5% in a 2 year CD and 6% in a 5 year CD. The widow could supplement her meager social security income with an additional $6,000 of interest income. This money was used to pay the ever increasing real estate taxes, medical insurance premiums, upkeep on the old house, and necessities like food, fuel, insurance and heating.

Fast forward four years to 2011. Savers and seniors are getting average interest rates on 6-month CDs this week of 0.58% nationwide, according to Bankrate.com. Rates on one-year CDs fell this week to 0.86%, while 5- year CDs fetched 2.04%. Money market funds are paying a pitiful 0.16% on average. The widow that was able to generate a risk free $6,000 only four years ago has only been able to generate less than $500 per year for the last three years. In addition, the government manipulated CPI, as calculated by the drones at the Bureau of Labor Statistics, was used to deny senior citizens an increase in their Social Security payments for the last two years. Meanwhile, the prices of food, fuel, clothing, insurance, medical care, and local taxes have been skyrocketing due to Federal Reserve created inflation. Do you think the number of Americans on food stamps surging from 26.3 million in 2007 to 45.8 million today has anything to do with Bernanke’s zero interest rate, inflationary policies?

This is not a theoretical hypothesis. Ben Bernanke has purposely sacrificed the savers and seniors in this country at the satanic altar of his Wall Street high priests of debt. According to the BEA data on personal income, in the 3rd quarter of 2008 savers and seniors were able to earn $1.42 trillion of interest income. By the 3rd quarter of 2010 these same people were only able to earn $984 billion of interest income due to Ben Bernanke’s zero interest rate policy. Make no mistake about it, the $436 billion difference was taken out of the pockets of senior citizens and Americans trying to save for their futures and deposited into the accounts of the mega-Wall Street banks that destroyed our financial system with their reckless greed induced debt toga party. The beneficiaries of zero interest rates, QE1, QE2, and all future QEs are Wall Street bankers and heavily indebted entities – namely our profligate Federal Government, who make drunken sailors, seem fiscally responsible. The victims of zero interest rates and quantitative easing are savers and risk averse senior citizens as their income has plummeted and inflation has ravaged their everyday existence. Meanwhile, the Wall Street fat cats have paid themselves over $70 billion in bonuses since 2008.

The fantasy world of moderate inflation is a myth created by the Federal Reserve in conjunction with the government bureaucrats in Washington DC. These people have tortured the CPI calculation worse than a Muslim being water boarded at Guantanamo Bay. Alan Greenspan, bubble blower extraordinaire, began the process of systematically screwing grandmothers in the 1980s. As a way to hide and obscure the true level of inflation caused by running endless deficits supporting a welfare/warfare empire, Greenspan and Clinton implemented devious adjustments to the CPI in order to screw senior citizens and allow Big Government to get bigger while stealthily impoverishing the middle class. One man has pulled back the curtain on the Wizards of Inflation to reveal the truth. John Williams at www.shadowstats.com publishes the true rate of inflation as measured in 1980, prior to the fraudulent manipulation of the CPI. The reality is that inflation has not dropped below 5% since 1987 and currently exceeds 10%.

  

John Williams described the Greenspan/Clinton conspiracy to defraud Americans:

“The Greenspan argument was that when steak got too expensive, the consumer would substitute hamburger for the steak, and that the inflation measure should reflect the costs tied to buying hamburger versus steak, instead of steak versus steak. Of course, replacing hamburger for steak in the calculations would reduce the inflation rate, but it represented the rate of inflation in terms of maintaining a declining standard of living. Cost of living was being replaced by the cost of survival. The old system told you how much you had to increase your income in order to keep buying steak. The new system promised you hamburger, and then dog food, perhaps, after that. Over a period of several years, straight arithmetic weighting of the CPI components was shifted to a geometric weighting. The Greenspan benefit of a geometric weighting was that it automatically gave a lower weighting to CPI components that were rising in price, and a higher weighting to those items dropping in price.” 

Now we hear the latest bipartisan plan to “save” Social Security is to alter the CPI again and further defraud Americans by pretending inflation does not exist. Why address a problem when you can obfuscate, misinform and lie? Anyone with critical thinking skills can clearly see that since 2007 real inflation for our widow has ranged between 5% and 10%, while her subsistence level income has been slashed by 26% due to Ben Bernanke’s zero interest rate policy. The good news is our widow will have the peace of mind knowing the price of steak and hamburger hasn’t really risen as she decides on whether to dine on dog food or cat food tonight.

 

“Government spending is always a “tax” burden on the American people and is never equally or fairly distributed. The poor and low-middle income workers always suffer the most from the deceitful tax of inflation and borrowing.” – Ron Paul

 

The Road to Impoverishment & Authoritarianism

There is a direct connection between Federal Reserve policies and the impoverishment of the middle class and seniors. The average American does not appreciate the disastrous consequences of deficit spending and currency devaluation by the Federal Reserve. Ron Paul has been sounding the warning for over a decade, but no one has been listening:

“The greatest threat facing America today is the disastrous fiscal policies of our own government, marked by shameless deficit spending and Federal Reserve currency devaluation. It is this one-two punch– Congress spending more than it can tax or borrow, and the Fed printing money to make up the difference– that threatens to impoverish us by further destroying the value of our dollars.”

It is no longer a threat. It is reality. The chart below tells the story.

The Federal Funds rate was 6.5% when George W. Bush assumed the presidency in 2000. The economy was booming, unemployment was 4.2%, the country was running fiscal surpluses, and the National Debt stood at $5.7 trillion. Alan Greenspan was the Federal Reserve Chairman and had been in that position since 1987. The Federal Funds Rate averaged 5.25% from 1990 through 2000 as the country grew strongly and America came the closest to full employment in its history. In 2001 Greenspan set in motion the creation of a tsunami of debt that swept over the entire country in 2008. The short shallow 2001 recession convinced Greenspan to reduce rates to 1% and keep them below 3% until the middle of 2005. He did this with the full support of his right hand man at the Fed – Ben Bernanke.

“The failure of Chairman Greenspan and other FOMC members to address the fiscal and monetary problems of the United States during his almost two decades at the Fed has left the United States on a trajectory for economic stagnation, hyperinflation, and the attendant political and social costs of such policies.” – Chris Whalen – Inflated – How Money & Debt Built the American Dream 

Greenspan kept interest rates excessively low three years into an economic recovery, creating the largest bubble in world history. He handed the inflation baton to Bernanke in February 2006 and Ben has been sprinting at top speed for the last five years printing money faster than a Japanese bullet train. With a true rate of inflation running between 5% and 10% during the 2000 through 2011 time frame, market driven interest rates should have been in that same range. But Alan and Ben have kept the Federal Funds rate at an average level of 2.25% over this period. The result has been a consumer debt bubble, housing bubble and now a government debt bubble. Instead of accepting the consequences of excessive liquidity, excessive debt and mal-investment by the Wall Street banks and liquidating the toxic poison from our economic system with the resulting economic depression and losses borne by the stockholders and bondholders of the criminal Wall Street enterprises, Ben Bernanke and Tim Geithner chose to sacrifice the American taxpayer, savers, and seniors to keep their Wall Street masters in their NYC penthouses and Hamptons estates.

The shrieking liberal left blames capitalism and demands more social welfare benefits for their entitled constituents. The fact is we have not had true capitalism in this country since 1913.

“Capitalism should not be condemned, since we haven’t had capitalism. A system of capitalism presumes sound money, not fiat money manipulated by a central bank. Capitalism cherishes voluntary contracts and interest rates that are determined by savings, not credit creation by a central bank.” – Ron Paul

 

The Day the Dollar Died – August 15, 1971

“With the exception only of the period of the gold standard, practically all governments of history have used their exclusive power to issue money to defraud and plunder the people.” – F.A. von Hayak 

“The road paved with inflation and debt is also the road to authoritarianism.” – Chris Whalen – Inflated – How Money & Debt Built the American Dream 

On August 15, 1971, exactly forty years ago this week, Richard Nixon closed the gold window and removed the last vestiges of restraint on politicians and central bankers. Politicians were free to make promises that couldn’t be kept to buy votes and central bankers were free to print fiat dollars and create inflation to support an ever growing warfare/welfare state. On that date the non-manipulated CPI was 40.8. Today, forty years later, the highly manipulated CPI is 225.7, a 553% increase. In reality, true inflation has risen more than 700% since August 1971. Some other facts put this relentless inflation into perspective:

  • GDP has ascended from $1.1 trillion to $15.0 trillion today, a 1,364% increase in forty years.
  • The National Debt has risen from $400 billion to $14.5 trillion, a 3,625% increase in forty years.
  • Total wage income has grown from $588 billion to $6.627 trillion today, a 1,127% increase in forty years.
  • Consumer credit outstanding has accumulated from $141 billion to $2.446 trillion today, a 1,735% increase in forty years.
  • War spending has increased from $95 billion to $966 billion today, a 1,017% increase in forty years. The U.S. was in the midst of the Vietnam War in 1971.
  • Social welfare transfers from the Federal government for Social Security, Medicare, Medicaid, Veterans, and Unemployment increased from $87 billion to $2.305 trillion today, a 2,649% increase in forty years.

These facts prove how twisted and warped our economic system and society have become. Real wages are lower than they were in 1971 as families were forced to put two parents into the workforce forcing children to be raised by strangers, with the resultant social consequences. The corporate media, financial industrial complex and housing industrial complex convinced Americans they had to keep up with the Joneses with new luxury automobiles, extravagant McMansions, and the expensive accoutrements that went along with these representations of fake wealth. The financial plundering of the country by the peddlers of debt on Wall Street could not have happened without the easy money, no regulation policies of the Federal Reserve for the last decade. The National Debt is increasing at a rate of 10% per year while GDP is increasing at a rate of less than 2% per year. Anyone with even the most basic math skills can see this train is going to go off the tracks. Our spending on social welfare benefits has grown at a rate twice as high as our GDP growth for the last forty years and the establishment in Washington has no resolve to address these un-payable promises. The liberals squealed like stuck pigs over the horrific non-cuts in the recent joke debt ceiling compromise. The neo-cons who control the Republican agenda think $1 trillion per year for their war machine is far too little and endangers our very existence. Consumers refuse to accept the reality of their precarious existence balanced on the edge of their 13 credit cards.

Americans of all parties, ages, races, persuasions, education and beliefs have shirked their civic and moral responsibility to future generations. The rampant greed on Wall Street, corruption in Washington DC, shallowness of the American people and cowardice of all in not accepting responsibility for their actions will lead to the end of this country as we know it. There is no courage among the political class in Washington DC to truly take the steps required to save this country from the most predictable cataclysm in history. The politicians and citizens they represent have decided to delegate their civic responsibility to Ben Bernanke. He has tripled the Federal Reserve’s balance sheet by acquiring the toxic mortgage “assets” of the Wall Street banks and buying $600 billion of U.S. Treasuries. The Federal Funds Rate is .07%. His announcement of zero interest rates for two more years proves he has run out of theories and ammo. Jim Rickards, in 2010, pointed out the danger in Bernanke’s reckless policies:

“Fed Chairman Bernanke wakes up every morning and tries to trash the dollar with quantitative easing, zero interest rates and swap lines with the central banks. But it has not been working. The Fed has never taken it to the next step and asked what happens when quantitative easing does not work.”

The utter failure of QE2, hollow Congressional spending “cuts” that will keep the National Debt on track towards $23 trillion by 2021, S&P downgrade and recent plunge in the stock market are the first cracks in the façade of the great American Empire. We have entered a period of institutional crisis and this fiscal spiral will lead us further into the clutches of a more centralized authoritarian form of government unless the people stand up to the junta of mercantilist oligarchs that control this country. Do we want to relinquish our remaining freedoms and liberties for the cloak of corporate fascist authoritarian central planning disguised as safety and security? The Romans chose security over freedom. The time has come to make a choice about what we will become. Ben Franklin stated the obvious two centuries ago:

 Those who would give up Essential Liberty
to purchase a little Temporary Safety,
deserve neither Liberty nor Safety.

– Ben Franklin

 

PEACOCK SYNDROME – AMERICA’S FATAL DISEASE

“There will be, in the next generation or so, a pharmacological method of making people love their servitude, and producing dictatorship without tears, so to speak, producing a kind of painless concentration camp for entire societies, so that people will in fact have their liberties taken away from them, but will rather enjoy it, because they will be distracted from any desire to rebel by propaganda or brainwashing, or brainwashing enhanced by pharmacological methods. And this seems to be the final revolution.”  – Aldous Huxley

 

Researchers at the University of Texas recently published a study about why men buy or lease flashy, extravagant, expensive cars like a gold plated Porsche Carrera GT. There conclusion was:

“Although showy spending is often perceived as wasteful, frivolous and even narcissistic, an evolutionary perspective suggests that blatant displays of resources may serve an important function, namely as a communication strategy designed to gain reproductive rewards.”

To put that in laymen’s terms, guys drive flashy expensive cars so they can get laid. Researcher Dr Vladas Griskevicius said: “The studies show that some men are like peacocks.  They’re the ones driving the bright colored sports car.”

Lead author Dr Jill Sundie said: “This research suggests that conspicuous products, such as Porsches, can serve the same function for some men that large and brilliant feathers serve for peacocks.” The male urge to merge with hot women led them to make fiscally irresponsible short term focused decisions. I think the researchers needed to broaden the scope of their study. Millions of Americans, men and women inclusive, have been infected with Peacock Syndrome. Millions of delusional Americans thought owning flashy things, living in the biggest McMansion, and driving a higher series BMW made them more attractive, more successful, and the most dazzling peacock in the zoo.

This is not an attribute specific to Americans, but a failing of all humans throughout history. Charles Mackay captured this human impulse in his 1841 book Extraordinary Popular Delusions and the Madness of Crowds:

“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.”

The herd has been mad since 1970 and with the post economic collapse of 2008, some people are recovering their senses slowly, and one by one. The country was overrun by flocks of ostentatious peacocks displaying their plumage in an effort to impress their friends, families and work colleagues. What set the flaunting American peacocks apart was the fact they financed their splendid display of plumage with $0 down and 0% interest for seven years.  The lifestyles of the rich and famous miraculously became available to the poor and middle class through the availability of easy abundant credit provided by the friendly kind hearted Wall Street banks and their heroin dealers at the Federal Reserve.

The United States has experienced a four decade long “expenditure cascade”.  An expenditure cascade occurs when the rapid income growth of top earners fuels additional spending by the lower earner wannabes. The cascade begins among top earners, which encourages the middle class to spend more which, in turn, encourages the lower class to spend more. Ultimately, these expenditure cascades reduce the amount that each family saves, as there is less money available to save due to extra spending on frivolous discretionary items. Expenditure cascades are triggered by consumption. The consumption of the wealthy triggers increased spending in the class directly below them and the chain continues down to the bottom. This is a dangerous reaction for those at the bottom who have little disposable income originally and even less after they attempt to keep up with others spending habits.

This cascade of expenditures could not have occurred without cheap easy credit, supplied by Wall Street shysters and abetted by their puppets at the Federal Reserve through their inflationary policies. Real wages are lower today than they were in 1970. Coincidentally, the credit card began its ascendance as the peacock payment of choice in 1970. There are now over 600 million credit cards in circulation in the U.S. in the hands of 177 million fully plumed peacocks and peacock wannabes.

Monthly Payment Nation

“Consumerism re­quires the services of expert salesmen versed in all the arts (including the more insidious arts) of persuasion. Under a free enterprise system commercial propa­ganda by any and every means is absolutely indis­pensable. But the indispensable is not necessarily the desirable. What is demonstrably good in the sphere of economics may be far from good for men and women as voters or even as human beings.”  – Aldous Huxley

 

 

The country seemed to do just fine from 1945 through 1970 with no credit card debt and moderate levels of auto loan debt. In fact, this period in U.S. history was marked by strong economic growth created by capital investment, savings, and the American middle class realizing the American dream of a better life based upon their work ethic. Around about 1970, the intersection of Baby Boomers coming of age, the belief that social justice for all was a noble goal, and Nixon’s closing the gold window, opened Pandora’s Box and the evil released has brought the country to the precipice of ruin. Today, consumer credit outstanding totals $2.43 trillion, or $22,000 per household. It peaked at $2.6 trillion in 2008 and the storyline fed to the masses was that Americans had seen the light and embraced frugality by paying off their debts. As with most storylines spouted by the mainstream media, it was completely false. The Wall Street banks wrote off over $200 billion since 2008, while delusional peacocks continued to finance and lease gas guzzling luxury automobiles, while charging their purchase of an iPad2 and Lady Gaga concert tickets on one of their 13 credit cards.

It seems a vast swath of America refuse to shed their peacock feathers. This explains why you see BMWs, Mercedes, Escalades, and Porsches parked in the driveways of $100,000 houses. Automobiles are the truest representation of American peacock syndrome. Very few people look at a car purchase in a rational long term financial sense. It’s about impressing the neighbors, your peers and your family. Driving a brand new luxury car gives you the appearance of success. The neighbors don’t know you are in debt up to your eyeballs. This explains why 30% to 40% of all luxury cars are leased. A man could buy a $20,000 Honda hybrid with 10% down and finance the rest at 0.9% for three years. His monthly payment would be $500. After three years he would own the car outright, with the added benefit of getting 45 mpg. He could then invest the $500 per month for the next seven years in gold and silver or something else that benefits from Federal Reserve created inflation. In today’s society this would be the act of a doo doo bird.

  

 

Why drive a putt putt car when you can drive the ultimate peacock machine – a BMW 528i with 24-valve inline 240-horsepower 6-cylinder engine with composite magnesium/aluminum engine block, Valvetronic, and Double-VANOS steplessly variable valve timing, 10-way power-adjustable driver’s and front passenger’s seat with 4-way lumbar support, and memory system for driver’s seat, steering wheel and outside mirrors, along with high-fidelity 12-speaker sound system, including 2 subwoofers under the front seats, and digital 7-channel amplifier with 205 watts of power. Plus it looks really cool. This materialism machine can be leased for the same $500 per month that the doo doo bird pays for his Honda hybrid. Of course, after three years of renting luxury wheels the peacock has to turn in the 528i and lease an equally luxurious auto because driving an economy car would now harm his reputation. Colorful plumage is everything to a peacock.

Sometime over the years Americans lost their bearings and began to ignore a basic truth. The only way to accumulate wealth is to spend less than you make and save the difference. Over a ten year time frame the peacock will have dished out $60,000 renting luxury cars, while the doo doo bird will have expended $21,000 during the first three years and then invested $500 per month for 84 months, leaving him with a net $25,000 asset, based on a modest investment return of 5%. The doo doo bird ends up $85,000 wealthier than the peacock at the end of ten years. If you peruse the car dealer advertisements in your local paper, the price of the car is rarely even printed, only the monthly lease payment or 0% financing offer. There is a reason why the average American lives paycheck to paycheck, has no emergency fund for a rainy day, and has virtually no retirement savings socked away. Status, reputation and the appearance of success became more important to millions of Americans than living within their means and actually sacrificing and doing the hard work required to succeed. Delayed gratification is an unknown concept in America.

In 1970, 37% of households consisted of 4 or more people and we somehow managed to get by with one four door car per household. Today, only 24% of households consist of 4 or more people. There are 113 million households and over 250 million passenger vehicles, or 2.2 per household. So, even though the number of people in our households has shrunk dramatically, we needed 120% more vehicles to transport our vast quantities of stuff. Not only do we have more vehicles, but the size of these symbols of gluttony has doubled and tripled, with fitting names like: Tundra, Navigator, Titan, Yukon, Suburban and Hummer. Every soccer mom with two kids needed a 20 foot long, 6 foot high Yukon with an 8 cylinder engine, getting 12 mpg to shuttle around little Aiden and Chloe to their ten scheduled weekly activities. It wasn’t only automobiles that Americans went gaga over. The average home size in 1970 was 1,400 square feet (we drive cars bigger than that today). By 2009, the average home size reached 2,700 square feet. God knows we need 12 rooms for our 2.4 person households. The expenditure cascade started as a trickle in 1970 but became a raging uncontrollable waterfall by 2008.

 

Delusional Americans have been slowly lured into the web of debt and living their lives based upon whether they can make the monthly payment on their debt. I can anticipate the outrage from those who declare it wasn’t them, it was the other guy. Everyone has an excuse for why they aren’t to blame, but the facts speak otherwise:

  • Non-revolving (auto & education) debt outstanding is at an all-time high of $1.64 trillion.
  • The average auto loan is now $27,000 with a loan to value ratio of 80% to 90%, down from 95% in 2007.
  • Auto dealers are now offering $0 down and 0% interest for 72 months on many models. Ask yourself how a finance company can make a profit with those terms.
  • There are 54 million households with a revolving credit card balance, proving that approximately 50% of Americans are attempting to live above their means.
  • The average credit card debt per household with credit card debt is $14,687.
  • The average APR on a new credit card is 15%, even though the banks can borrow from the Federal Reserve for 0.25%.
  • In 2009, the United States Census Bureau determined there were nearly 1.5 billion credit cards in use in the U.S. A stack of all those credit cards would reach more than 70 miles into space — and be almost as tall as 13 Mount Everests.
  • 76% of undergraduates have credit cards, and the average undergrad has $2,200 in credit card debt. Additionally, they will amass almost $20,000 in student debt.
  • On average, today’s consumer has a total of 13 credit obligations on record at a credit bureau. These include credit cards (such as department store charge cards, gas cards, and bank cards) and installment loans (auto loans, mortgage loans, student loans, etc.).
  • Over 90 percent of African-American families earning between $10,000 and $24,999 had credit card debt. What bank in their right mind would issue a credit card to someone making $15,000 per year?
  • Discussing credit card debt is highly taboo. The topics at the top of the list of things that people say they are very or somewhat unlikely to talk openly about with someone they just met were: The amount of credit card debt (81%); details of your love life (81%); your salary (77%); the amount you pay for your monthly mortgage or rent (72%); your health problems (62%); your weight (50%). I wonder why?
  • Penalty fees from credit cards added up to about $20.5 billion in 2009, according to R. K. Hammer, a consultant to the credit card industry. Don’t be one day late with that credit card payment. It’s good to be a bank.
  • The average late fee was found to have risen to $28.19, way up from $25.90 in 2008. Consumer Action reported that late fees reached up to $39 per incident.
  • The volume of gasoline purchases placed on credit cards jumped 39% last month from a year earlier, compared with a 21% increase in June 2010. Food shopping increased 5% after falling 7% last year. The value of an average transaction on credit cards outpaced the gain for debit cards, showing consumers are increasingly relying on borrowing to pay for gasoline and other necessities.

After decades of a debt financed contest to display the gaudiest plumage, is the average American happier? Considering more than 10% of all Americans are on anti-depressant drugs, I’d say not. The rat race for status, the appearance of wealth and visible faux displays of success do not increase well-being. If most of our earnings are spent on an empty game of status, we should not expect much improvement in our quality of life. There is something perverse about having more than enough. When we have more, it is never enough. It is always somewhere out there, just out of reach. This is the attitude that drives the criminals on Wall Street and politicians in Washington DC to constantly seek more power and wealth. The more we acquire, the more elusive enough becomes. Much of the debt financed purchases of consumer trinkets, baubles and gadgets is nothing more than an expensive anesthetic to deaden the pain of empty lives.

Based upon the facts, the average American has not benefitted from the decades long materialistic frenzy. They have sacrificed their futures for the fleeting glory of ephemeral riches. In fact, the average American could not have participated in the expenditure cascade had they not been enabled by the financial industry and cheap plentiful money provided by the financial industries’ drug dealer – the Federal Reserve. The financial industry complex used their power and wealth to utilize all means of propaganda and mass media outlets to convince Americans that debt was good and more debt was even better. I’ll address the insidious aspects of the unholy union of debt and propaganda in Part Two – Propaganda Nation Built Upon Delusions of Debt.

Meanwhile, millions of Americans cling to their borrowed peacock feathers as the butcher of reality bears down upon them. The end won’t be pretty. The brave conquerors of strip malls across the land can enjoy their toys, gadgets, and treasures for awhile longer, but they need to remember one thing – Glory is fleeting and death can come suddenly.

 

“For over a thousand years Roman conquerors returning from the wars enjoyed the honor of triumph, a tumultuous parade. In the procession came trumpeteers, musicians and strange animals from conquered territories, together with carts laden with treasure and captured armaments. The conquerors rode in a triumphal chariot, the dazed prisoners walking in chains before him. Sometimes his children robed in white stood with him in the chariot or rode the trace horses. A slave stood behind the conqueror holding a golden crown and whispering in his ear a warning: that all glory is fleeting.”

Last scene from the movie Patton
 
 
 
 
 
 
 
 
 
 

 

LIVIN IN BEVERLY HILLS (Oldie but Goodie)

I wrote this back in September 2009 before I had a website. I was reminded of it this morning as Weezer blared from my radio on the way to work.  

For the last three decades millions of Americans have been living in Beverly Hills. How can this be? Only 35,000 people reside in Beverly Hills, California. Millions have acted like they live in Beverly Hills, where the median household income is $125,000. The median household income in the United States is $50,000. There are 116 million households in the United States. Only 12 million households have income of $125,000 or more. There are 60 million households making less than $50,000. 

Why shouldn’t the 60 million households be entitled to live like the top 10%? This is America, where the American Dream of wealth and riches is achievable. Just one small problem. Millions chose to live like the privileged Beverly Hills elite without doing the difficult work to earn their way into the top 10%. They made these dreadful decisions of their own free will. No one forced millions of Americans to borrow and spend like drunken soldiers.

It appears that the psychology of the nation transformed in the early 1980’s. Was it the optimistic message of “Morning in America” preached to the country by Ronald Reagan? Was it the fact that the youngest Baby Boomers were turning 35, entering their prime spending years? Or, was it the long-term decline in interest rates from 18% to 1% over two decades? Whatever the rationale, millions are now drowning in deep pool of debt.

Auto Nation

Where I come from isn’t all that great        
My automobile is a piece of crap
  
My fashion sense is a little whack           
And my friends are just as screwy as me
                      Living in Beverly Hills – Weezer

I spend 500 hours per year in my car commuting on the Schuykill Expressway to and from work. In my spare time, I’ve calculated that I will spend at least a year of my life in traffic before I retire. While commuting at 5 mph on the Schuykill, I can’t help but survey the cars I’m sharing the road with. There are thousands jamming the highways in the Philadelphia area. There are 230 million cars in the U.S. and approximately 200 million drivers. We are a car crazed nation, with the number of cars per person 40% higher than Europe, 500% higher than China and 6,200% more than India. In 1970, when I was seven years old, the number of cars per 1,000 people was 529. Today it is 765, a 45% increase in three decades. Suburban dwellers have a love affair with their cars.

The average price of a new car exceeds $30,000 today. That is a nice chunk of change. I have a mental block paying that much money for an asset, that losses 20% of its value in the 1st year of ownership. My price limit is $20,000. I finance my cars over 4 years and try to get 10 years out of them. The 6 years of no payments goes directly into savings. My frugality regarding cars probably harks back to my father buying used cars during my entire childhood. Cars were a means of transportation, not a symbol of success. It appears to me that expensive luxury cars are an attempt at filling a psychological or emotional void in people’s lives. We spend half our lives in cubicles or offices and the other half in our shielded houses with gates and fences to keep people at a distance. The only time we are seen by others is on the highways and byways. An expensive sports car tells the world you are a success. A luxury car is a futile attempt at increasing your perceived happiness. Your fashion sense may be a little whack, but your car isn’t a piece of crap.

This brings me to the conundrum that has confounded me as I drive to work each day. There appears to be many more BMW and Mercedes vehicles on the road than people with enough income to own one of these vehicles. How can this be? I was befuddled. After a little research it became quite clear. The graphs below tell the whole sordid story. Borrow today, live like a Beverly Hills hotshot, roll the loan or lease into the next loan or lease in 3 years, and don’t be troubled about the future. According to the Federal Reserve, consumer non-revolving debt grew from $300 billion in 1980 to $1.6 trillion today. About $1 trilion of this is auto loans. The average automobile loan today is for 63 months, with some going as high as 84 months, compared with an average of less than 48 months in the early 1990s. In 1997 banks financed an average 89% of a new vehicle’s price. The average loan amount was $17,000. In 2007 banks financed 101% of a new vehicle’s price, since consumers borrowed to cover the amount they were upside down on their trade-in. The average loan amount is now $29,000. A full 40% of all trade-ins involve upside-down car loans. The average American car “owner” is in debt up to their eyeballs and upside down on their loan, but at least they look like a million bucks in the eyes of their neighbors and co-workers. Looking marvelous is what passes for achievement today.

Of course, it takes two to tango. A car buyer with no money wouldn’t be able to drive that beautiful BMW X5 or that Mercedes ML350 unless someone loans them the money to do so. This is where the creative geniuses from Wall Street entered the picture. Auto loans were securitized into packages and sold off to investors. The banks and finance companies who initiated the loans did not care if the loans went bad. Their sole intent was to move cars off the lots, not lose sleep about silly details like credit scores, income, or ability to pay back the loan. It worked wonders for the car companies. Annual sales rolled along at a 16 million per year clip. Car executives and bankers made ungodly salaries and bonuses. Then reality set in. Many borrowers couldn’t really afford their loans. Delinquency rates have soared to all time highs in the 10% range and are headed higher. The securitization market froze and annual sales have plunged below 10 million units. Another Wall Street success story.

The ability of car companies to make payments extremely low through long-term loans and leases is the reason an average Joe making $50,000 per year can drive a BMW and resemble someone making $150,000 per year. Chrysler and Ford generated 20% of their car sales through leases, while GM led the pack at 40% of their sales. Many of these leases were for SUVs and other giant gas guzzlers. When gas prices soared in 2008, the residual value of these gas guzzlers plummeted as the resale market disappeared. Ford and Chrysler have written off billions. The king of the hill, GMAC accumulated $33 billion of lease assets and is slowly but surely writting off $14 million of these “assets”, while the taxpayer funds their future bad leases.

Leases have made it possible for millions of Americans to drive the hottest luxurious wheels their limited cash budgets would not permit them to buy. Auto makers loved leases because they could sell higher-priced vehicles, which generate a gusher of profits in the short-term. By piling on inducements of their own, such as rebates or 0% financing deals, auto makers were able to subsidize consumers’ lease payments further. As a result, Americans have been able to have access to vehicles their parents never envisioned driving. Leases allowed anyone to look like a rock-star, driving luxury sedans, sports cars and Hummers costing $40,000 to $60,000. The Wall Street Journal describes a common scenario:

For Richelle Babcock, a mother of two young boys in Ann Arbor, Mich., leasing has made it possible to get new cars every couple of years. A few years ago, she took advantage of a trade-in deal and other incentives Chrysler was offering and got a $180-a-month lease on a 2006 Jeep Commander with a sticker price of about $35,000. There’s “no way,” Ms. Babcock says, that she would have bought the Commander outright. “I don’t want to have to own it and drive it forever.”  Indeed, in December she turned it in and instead leased a new 2008 Commander. Her payment roughly doubled, but that’s mainly because the lease is much less restrictive about her annual mileage.

I’d like to ask Ms. Babcock a couple questions. Does she have college education funds set up for her two young boys? Does she have an emergency fund of 6 months of living expenses? How much does she have in her retirement account? I’m sure she would be offended by such questions. It’s her right to get a brand new car every two years. These are the people who can’t distinguish a need from a want.

This brings me to the chapter in this horror story that really sticks in my craw. I drive through West Philadelphia every day. The neighborhoods are decrepit, with boarded up houses, trash strewn vacant lots, grade schools that resemble prisons, and a substantial number of unemployed folks shuffling about from morning to night. These neighborhoods appear to have five times as many BMWs and Mercedes as my suburban upper middle class neighborhood. According to the U.S. Census, West Philly is a predominantly Black neighborhood, with a large proportion of unmarried high school dropouts living in poverty, occupying dilapidated houses with Direct TV dishes on their roofs. According to the U.S. Census, my neighborhood is occupied by people who are five times higher on the income scale.

The August unemployment figures from the BLS show that the unemployment rate for Black men is 17.0% versus 10.6% last August and versus 9.3% for White men. The unemployment rate for Black teenagers is 34.7%. With these figures, you would expect unrest, looting, and riots in West Philly. The civil unrest hasn’t happened in West Philly or anywhere else. I think I’ve figured out why. Just picture a 20 year old unemployed Black man calling his homies on his iPhone urging them to drag themselves away from staring at their 52 inch HDTVs with 600 stations on their Direct TV network, hop into their BMW X5, and drive over to the comprehensive healthcare riots. It’s not happening. Our elected officials, Federal Reserve and banking cartel have chosen to buy off the poor at the expense of the middle class, so the rich can get richer.

Easy money allows the poor to live like the rich. This explains why people in West Philly are able to drive $50,000 one year old BMWs, while I choose to drive an 8 year old CRV with 130,000 miles. My choice was to finance my $20,000 car over 4 years at 7%. I had a $500 monthly payment for 4 years and then was able to save $500 per month for the next 6 years, banking $36,000 in savings. The auto financing companies GMAC, Ford Credit, and Chrysler Credit offer rebate incentives, 7 year loans, and 0% interest to entice everyone to drive BMWs and Mercedes for a monthly payment below $500. The poor are more likely drawn to three year leases with even lower monthly payments. You can lease a BMW for $399 per month or lower. Once you are lured into 3 year leases or 7 year loans, you are ensnared in a lifetime car payment, never saving a dime. Over 4 decades, my method will leave me with $200,000 of savings. A perpetual car payment will leave you with $0 of savings. Millions have chosen this negligent path. Not only did they pursue this path, they hurtled themselves down the path with gusto by borrowing against their houses to buy cars. The numb-nuts in California and Florida were the worst offenders.

A drug addict still needs a dealer to get their fix. Politicians in Washington with their cohorts in crime, the Federal Reserve and the banking cartel, provided the drug of easy money. The unholy combination of a psychological need to appear successful and easy money has created a deadly recipe for those in the middle class who drive their modest cars for 10 years and save for the future. The black magic of securitization has allowed banks and finance companies to bestow credit card cards and car loans to high school dropouts making $20,000 per year in West Philly with no concern about getting repaid. They packaged this future bad debt, paid off Moody’s and S&P to rate it AAA, and dumped it on suckers throughout the world. Now, auto loan delinquency rates are at all time highs, 1.7 million cars were repossessed in 2008, with another 2 million likely to be repossessed in 2009.

The underprivileged people in West Philadelphia don’t comprehend that politicians and bankers are actually keeping them entrapped in poverty by providing them with easy credit and persuading them that making perpetual payments for cars, TVs, and other material goods is a normal lifestyle. When reality sets in and these people stop making their payments, no trouble for them. As the financial system came crashing down due to the millions of bad loans made by the banking cartel, their protectors Hank (Goldman) Paulson and Ben (Helicopter) Bernanke funneled TRILLIONS of your tax dollars and your children’s tax dollars and their children’s tax dollars to the banks that committed these crimes. The poor people in West Philly don’t pay taxes, so they got to drive BMWs and watch 52 inch TVs for awhile, and are left relatively unscathed. The middle class is paying the bill, losing millions of jobs, while seeing their 401ks drop by 40% and they are still driving their 10 year old cars. Government now wants you to pay more so the poor will have health insurance when they get injured in a BMW accident.

What’s My Payment?

I didn’t go to boarding schools
Preppy girls never looked at me
 
Why should they, I ain’t nobody
Got nothing in my pocket

Living in Beverly Hills – Weezer

For the last three decades you didn’t need anything in your pocket to attract a preppy girl. You just needed to whip out one of your 10 credit cards and act like a Beverly Hills hotshot. Cash was for suckers. Credit cards are so easy to use. You just pull it out, buy whatever you desire at that moment and make a minimum payment every month until infinity. We’ve become a minimum payment nation. If you can handle the minimum payment, it’s yours. In 2006, the Census Bureau determined that there were nearly 1.5 billion credit cards in use in the U.S. A stack of all those credit cards would reach more than 70 miles into space — and be almost as tall as 13 Mount Everests. Consumer credit debt has risen from $400 billion in 1980 to $2.5 trillion today. Consumers have an average of 5.4 credit cards with $973 billion outstanding. The average outstanding credit card debt for households that have a credit card was $10,679 at the end of 2008. The average American with a credit file is responsible for $16,635 in debt, excluding mortgages, according to Experian. The most fascinating fact is that the top 10 U.S. credit card issuers held an 87.55% market share of $973 billion in general purpose card outstanding in 2008. These 10 banks are coincidently the same banks that brought down the financial system (Bank of America, Citicorp, JP Morgan Chase, Wells Fargo, Capital One, HSBC, American Express, Discover, US Bank, USAA).

Consumer Credit Debt

It has taken Americans three decades of overspending and under-saving to get into this pickle. As you may notice, consumer credit debt is $2.5 trillion and has barely budged downward. The pundits and economists predicting a strong economic recovery are blind to the truths of consumer debt. With actual unemployment exceeding 16.8%, 9 million people forced to work part-time wanting to work full-time, the work week at all time lows, and banks shutting down credit lines, consumers will be reducing or defaulting on their debt for years. With 70% of the economy dependent on consumer spending, there is absolutely no chance of a strong recovery. Household debt service payments as a percentage of disposable income reached a peak of 14.2% in 2007 and have plunged all the way to 13.5% today. Disposable income is plunging as people without jobs don’t have anything to dispose of.

A paradigm shift is occurring and the mainstream media, mainstream economists, and clueless politicians running this country do not understand the implications. Three decades of debt accumulation is not resolved in two years. It will take decades of reduced spending, paying down debt, and writing off debt. The Federal Reserve, banking cartel, and politicians are franticly attempting to make consumers borrow and spend with TARP, TALF, Cash for Clunkers, and numerous other debt increasing gimmicks. The consumer is tapped out. The median 401k balance in the U.S. is $26,000. Boomers realize they are 60 years old and have $50,000 of retirement savings and $30,000 of credit card debt. They are learning the brutal lesson of needs versus wants. The implications are disastrous for those dependent on a consumer spending society (i.e. retailers, restaurants, hotels, car makers, homebuilders).

There are 25% of households in the U.S. with no credit cards. Of those with a credit card, 30% pay off their balances each month. These are the people that have chosen to live within their means. They understand the difference between needs and wants. They appreciate the notion of delayed gratification. You buy things when you can afford them. You live a life of thrift and frugality, save for your family’s future, and live within the parameters of a budget. What a concept. The TARP accepting banks that control 87% of the credit card market are recording losses on an unprecedented scale. But no need to worry, the middle class tax payers come to the rescue again. Orwell must be rolling in his grave at the government originated Troubled Asset Relief Program. “Troubled” is an Orwellian word to describe debt that was knowingly issued by banks to people who would never pay it back in order to generate outrageous fees and bonuses for the executives issuing the debt. When the debt predictably went bad, “Relief” was provided to the criminal bankers on the backs of the taxpaying middle class. Bank of America, Wells Fargo and JP Morgan are bigger than they were before the financial crisis, their executives are still making millions, their “assets” are still “troubled”, and we continue to pay the bill, as will our children and grandchildren. Don’t worry. Ken Lewis, Vikram Pandit and Jamie Dimon’s grandchildren will inherit hundreds of millions of your tax dollars from their banker grandpas.   

I Wanna Be Just Like A King

Beverly Hills… That’s where I want to be! (gimme, gimme)
Living in Beverly Hills…
 
Beverly Hills… Rolling like a celebrity! (gimme, gimme)
Living in Beverly Hills…

Look at all those movie stars
They’re all so beautiful and clean
 
When the housemaids scrub the floors
They get the spaces in between

I wanna live a life like that
I wanna be just like a king
 
Take my picture by the pool
Cause I’m the next big thing
                                 Living in Beverly Hills – Weezer

The 8,000 square foot castle-like McMansions are the symbol of extravagance and excess that represent the worst of America’s hyper-consumerism culture. Even though the family unit has gotten smaller since 1970, the average home size has grown from 1,400 sq ft to 2,500 sq ft. McMansions are clearly not necessary due to family size. Essentially, it is another example of Boomers attempting to show the world they are successful. The bigger and gaudier the house the more flourishing you appear. This psychological need for approval combined with the big lie pushed by the National Association of Realtors that a house is always a great investment to generate the biggest housing bubble in history. One glance at Robert Shiller’s chart showing home prices versus population growth and CPI, proves beyond a shadow of a doubt that we have experienced a manic increase in house prices. It is also unambiguous that the downward spiral is not nearly complete. The housing cheerleaders continue to forecast a housing recovery that is still 5 years in the future.

It is mind boggling that home prices could have surged that high while owner’s equity has plunged from 70% in 1980 to 45%. People didn’t earn the McMansions, they borrowed them. The Federal Reserve created spiral in prices upward has trapped millions of late comers in houses that are worth 20% to 30% less than the mortgage debt that is strangling them. Over 16 million home occupiers (not homeowners) are underwater in their mortgage. The decisions to buy houses with nothing down, using option ARM loans, were free choices made by people who should have known better. The decisions to make subprime loans to people making $30,000, to make no-doc loans, and to not verify income or assets were purposefully done to enrich the bankers, mortgage brokers, and real estate agents. The $10.5 trillion of mortgage debt will need to be paid down or written off over many years, before the housing market will reach equilibrium again.

The dream of living like a king in Beverly Hills has come to a shattering conclusion. As mortgage delinquencies soar to all-time high levels, the kings are being led kicking and screaming to the foreclosure guillotine. Neighborhoods of McMansions in California, Phoenix, Florida, and Las Vegas are weed infested crime ridden high end ghettos. The American dream of home ownership spouted by George Bush and legislated through Fannie Mae and Freddie Mac has turned into a debt induced nightmare.   

MORTGAGE DELINQUENCIES

The Alt-A reset crisis which will begin in 2010 and not crest until 2013 is coming down the tracks at a swift pace. The credit criteria used by the banks that doled out Alt-A loans were as lax as the subprime loans that precipitated this crisis. These loans already have delinquency rates of 33%, even before these resets kick in. There is no evading this calamity. There is also no doubt how the Federal Reserve, Treasury, and government politicians will handle this next emergency. If you have lived in a modest home, made your mortgage payments, didn’t use your home equity to buy a Mercedes ML350, and pay your taxes, the government will seize your taxes again and dispense them to the profligate borrowers and criminal bankers. You will pay your mortgage and the mortgages on millions of other houses.  

Alt-A Loan Resets

Give Me Something I Need

No I don’t – I’m just a no class, beat down fool
And I will always be that way
 
I might as well enjoy my life
And watch the stars play

Beverly Hills… That’s where I want to be! (gimme, gimme)(gimme,gimme)
Living in Beverly Hills…
Beverly Hills… Rolling like a celebrity! (gimme, gimme) (gimme,gimme)
Living in Beverly Hills…
                                 Living in Beverly Hills – Weezer

The era of excess, gluttony, and overindulgence is coming to a wretched ending. The unraveling is complete. We have entered an epoch of crisis that will last for two decades. The coming winter will be cold, bitter and harsh on most Americans. Millions are learning that living in Beverly Hills was just a delusionary dream. They are just no class, beat down fools and I will always be that way. It is time to enjoy the more basic aspects of life: family, friends, enjoying what you’ve got, and leaving the world a better place for our children and grandchildren. It comes down to choices. It is time for Americans to grow up and take responsibility for their actions and their futures. They must realize that the Federal Reserve and the banking cartel are the only ones profiting from ever expanding debt. The Rising Debt Era has not benefited the borrowers as they borrowed toys they couldn’t afford. The beneficiaries were Bank of America, Citicorp, Wells Fargo, JP Morgan and the other members of the cartel. The 10 biggest banks in the country control 48% of all deposits, 50% of the mortgage market, and 87% of the credit card market, supported and protected by the Federal Reserve and Treasury Department. The “too big to fail” continue to get bigger, as the FDIC will shutter 500 smaller banks in the next year.

The banking cartel has no intentions of relinquishing power. It will be left to average Americans to make the right choices. Government will continue to push Keynesian Cash for Clunkers publicity stunts to keep their debt civilization going. The consumer society needs to be put to rest. Americans must ask themselves a few questions. Do you really need a $35 Aeropostale tee shirt when you can get an identical tee shirt at Kohl’s for $6? They were both made in the same Chinese sweatshop by 13 year old children. The difference is that Aeropostale will say it is a “green” shirt because there was no air conditioning used in the sweatshop ruining the ozone layer. What exactly does a pair of $345 Botticelli shoes do that a pair of $35 shoes from Payless Shoe Source won’t do? Does a $10,000 Rolex watch tell time better than a $50 Timex? Will an $85,000 BMW 750LI get you to the supermarket better than a $15,000 Honda Civic?

When I started researching this article, I came across a Heritage Foundation report called How Poor Are America’s Poor? Examining the “Plague” of Poverty in America. The article makes it clear that the poor in America do not fit the portrayal of living in poverty when compared to real poverty in Africa and much of the developing world. The report concludes:

 The typical American defined as “poor” by the government has a car, air conditioning, a refrigera­tor, a stove, a clothes washer and dryer, and a micro­wave. He has two color televisions, cable or satellite TV reception, a VCR or DVD player, and a stereo. He is able to obtain medical care. His home is in good repair and is not overcrowded. By his own report, his family is not hungry and he had suffi­cient funds in the past year to meet his family’s essential needs. While this individual’s life is not opulent, it is equally far from the popular images of dire poverty conveyed by the press, liberal activists, and politicians.

The main causes of child poverty in the United States are low levels of parental work, high numbers of single-parent families, and low skill levels of incoming immigrants. By increasing work and mar­riage, reducing illegal immigration, and by improv­ing the skill level of future legal immigrants, our nation can, over time, virtually eliminate remaining child poverty.

The Heritage Foundation report missed one key aspect of being poor in America. The politicians and banks have taken advantage of the poor’s lack of education and ignorance regarding the perils of debt and have enslaved them in a monthly payment plantation. The poor don’t own the cars, electronics, homes and appliances. They are renting them until they can no longer make the payments. The politicians have colluded with the Federal Reserve and banks to provide bad money to the poor in order to keep them satiated and pliable. When the debt predictably goes bad, the banks are compensated by their bought government cronies with middle class’ tax dollars.

“When I was a child I spoke as a child I understood as a child I thought as a child; but when I became a man I put away childish things.” I Cor. xiii. 11.

Americans, led by the Baby Boom Generation, have been living like spoiled children for thirty years. They have thought like children, with instant self-gratification as their sole aspiration. It is time to put away childish things. Hard times have arrived. There is no easy way out. We have kicked the can down the road for a generation. Tomorrow has arrived. Our long-term structural problems have now collided with our current debt induced tragedy. Current policies that further the expansion of debt will ultimately lead to the collapse of our economic system. The timing is all that is in doubt.

Give me something that I need
Satisfaction guaranteed to you
What’s the consolation prize?
Economy sized dreams of hope                     

When I was a kid I thought
I wanted all the things that I haven’t got
Oh. I learned the hardest way
Then I realized what it took
To tell the difference between
Thieves and crooks
A lesson learned to me and you

Give me something that I need
Satisfaction guaranteed
Because I’m thinking about
A brand new hope
The one I’ve never known
Cause now I know
It’s all that I wanted

Macy’s Day Parade – Green Day

Materialism has not provided what we needed. As our current crisis deepens, luxury cars and Rolex watches will seem so phony. Childish symbols like yellow rubber wristbands and yellow, pink, and rainbow ribbon stickers on our SUVs do nothing to change the world. When you are walking down the street, look people in the eye and say hello rather than staring at your feet or checking your latest email or text message on your “crackberry”. Deeper personal relationships with family and friends will become crucial. The thieves and crooks occupy Washington DC and Wall Street. We do not need what they are selling. Economy sized dreams of hope will sustain the citizens of this great country. Instead of accumulating stuff, give your stuff to people who need it. Donate your stuff to Purple Heart, the Salvation Army, or any other worthy charity. Donate your time to Manna, Habitat for Humanity, or any other worthy cause. Don’t delegate your role in caring for your fellow citizens to the government. Americans will soon realize that what they wanted was not what they needed.