Universal Translator

Thursday, June 28, 2012

The Lucky Ducky Older Generation

Speaking of Kevin Drum, a post he wrote the other day triggered something I’ve been thinking about for a while now:

          Both the boomers and the generation before them were enormously lucky to have started their careers in the postwar world, roughly from 1950 through 1980.  Good jobs were plentiful; retirement benefits – both public and private – increased steadily; and a variety of factors kept middle-class growth high.  But the beneficiaries of this good fortune, like all beneficiaries of good fortune, became convinced that they had done well solely through hard work and native talent.  If today’s kids aren’t doing as well, it must be because they’re dumber and lazier.

This sounds exactly right to me.  My grandmother is 81 years old, and is interested in discussing only a very few topics.  One of those is how godawful poor she and her family were when she was growing up in the 1930’s.  Seriously, it doesn’t matter what your opening conversation gambit is, she will find a way to turn it into a diatribe about how dirt poor she was when she was growing up.

Another of her favorite topics is how the world has gone to hell in a handbasket over the past couple of decades, how people spend too much money and take on too much debt, and how unjustifiable are their complaints about the state of their financial affairs.  “Nobody helped me and Papa,” she’ll tell you, “we came from nothing and we did all right.”

It never occurs to her that maybe in the 80 years of her life some significant things have changed.

For example, she was born into the Great Depression.  Don’t get me wrong . . . her family was dirt-poor to begin with, but the fact the country was mired in the Great Depression and she was born to a rural family and that rural family lived in one of the least developed of the states (North Carolina) certainly didn’t help.

But shortly after she was born FDR started implementing the New Deal and Keynesian economics.  Government spending was increased, even though that led to record government deficits.  Social Security and Medicare were signed into law.  By the time she was 12 World War II had started – an absolutely huge federal spending measure – and the amount of economic stimulus that deficit-financed project required lifted us out of the Depression.

By the time she was 20 and had married my grandfather, America was still pursuing Keynesian economics.  The highest marginal tax rate was very high (91%) and the money being raised by taxes was being plowed back into the economy.  Military spending continued as the Cold War boomed, the national highway program was taken up, and money was provided by the GI Bill to get millions of people a college education and get them started in middle-class professions.

Unions were strong.  By and large, wealth was not being concentrated only in the hands of the CEOs and a few upper-level executives, but was spread out amongst working-class Americans too.  As more and more people’s standard of living increased, they spent that money and provided a further boost to the economy.  Moreover, as Drum points out, back then people could be secure in their retirement because so many could actually count on receiving a pension, and – of course – America led the world in oil production.

My grandparents directly benefited from only  a few of these economic factors (for example, my grandfather served 20 years in the Marine Corps, and they lived next to Camp LeJeune), but they indirectly benefited from all of them.

Since then . . . let me see.  America no longer leads the world in oil production, but is the greatest importer of oil.  The assault on the New Deal has proceeded apace, and it is anyone’s guess whether Social Security and Medicare will be left standing five years from now – despite the fact workers have been overpaying into the Social Security trust fund for 30 years.  Unions have been gutted, and almost nobody has an actual pension to rely upon.  At the same time, income taxes have been reduced and flattened, and the capital gains tax has been slashed to 15%.

Keynesian economics is sneered at, federal investment in infrastructure and education has been increasingly cut back, and wages stopped keeping up with rising American productivity 35 years ago.  Now almost all the gains in American productivity are concentrated in the hands of only a tiny fraction of the American population.  And if you have the temerity to want to lift your social standing by getting a college education, you will almost certainly incur an enormous amount of non-dischargeable debt to carry around for the rest of your life.

In short, the economic factors that control much of one’s ability to earn a decent living, set money aside for retirement, and provide for one’s family have changed significantly over the life of this one woman.  In the beginning, those factors were almost entirely negative.  Then, for a brief couple of decades, they were incredibly favorable.  And now, they are once again very negative.

It is as if when she was born my grandmother were a tree seedling slowing dying on the ground in the middle of the desert, but then was suddenly picked up by a breeze and carried to the fertile plains of Iowa.  In that place she was able to grow strong and prosper, but it never occurs to her that most of the reason she was able to thrive is because she was surrounded by such a rich environment.  And now that our political system has been so thoroughly captured by short-sighted people whose only concern is to exploit that environment until now it too is almost a desert, she cannot see how hard it has become for most seedlings to grow strong the way she did.

I’ve tried to explain this to her on a couple of occasions she’s already settled on her narrative.  And as with the vast majority of people, having settled on her narrative it is extremely difficult to get her to give that up.

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