I want to have a debate, but w/o one that involves assumptions that an entire generation of people are bad (ie serves those lazy, spoiled dumb kids right), that kind of stuff.
So as it stands health care, real estate, daycare and tertiary education are increasing in price far faster than wages. Education and health care are growing at 6-10% a year while wages grow at 3%. This has been happening for decades, and probably isn’t letting up. Real estate went up, then crashed. Daycare becomes a necessity because when both parents have to work they need to pay for childcare.
Add into the fact that taxes are becoming more regressive. Sin taxes, sales taxes, fuel taxes, payroll taxes and property taxes have all gone up in the last 30 years, largely to compensate for declines in taxes on capital (lower dividend, corporate, capital gains, federal income, estate, luxury, etc).
Many of us in Generation X and Y are still struggling in our 30s. We aren’t perfect, but we did try to do many things right. However the high unemployment, middle class squeeze is making it harder to really act and feel like autonomous adults.
On top of that, our parents generation is approaching retirement age when the stock market and housing market collapsed. Which means they have their own problems now.
It just seems like Generation X and Y are more likely to depend on family for help than our parents. But now our parents are struggling too. And what happens in 20-30 years when our kids are our age (thank god I have no kids and never will)? What happens after another 30 years of wages going up at 3% and year while health care, tertiary education and real estate go up at 7% a year? Wages will double every 24 years while other important needs (health care, education, real estate) will double every 10 years. By 30 years we will make 1.3x as much income but pay 8x as much as we do now for these things.
Add on natural resource shortages the world may run into (oil, metals, agricultural products) which we are already getting a taste of which will drive up prices.
Plus there is a chance that regressive taxes (state taxes, fuel taxes, sin taxes, payroll taxes, property taxes) will go even higher, hitting the middle class even harder.
So what do you feel will happen? I know you can’t really make accurate predictions, but what are your assumptions?
Do you think we will revert to dormitory living? Will we have tiered healthcare where a basic public plan covers everyone with bare hospital rooms, generic drugs, treatments that are 5-10 years old and physician assistants but the people who want more advanced medical care have to pay far extra? Obviously the care would still be high quality, but it would be far more tiered.
What are generation X and Y going to do when they are parents, their kids need help and our parents need help too since they will be in their late 70s and their retirement funds will be dwindling? Baby boomers generally were only able to save about 60k for retirement on average. And many are underwater with their houses.
I really don’t mind the decline in standard of living (I have reasonably low standards, at least by western standards). However it seems we will have more situations of multiple families or 3 generations in one home, sharing cars, more public transit, less meat, fewer consumer goods, etc.
Mentally, what do you feel the effects will be? Things like owning a home, having kids or being an autonomous adult feel difficult to achieve and probably going to get harder. Many in our generation depend on parents, who themselves are facing massive financial problems (low retirement savings and a housing collapse). We (generation X and Y) can barely take care of ourselves, so what are our kids supposed to do?
I assume good and bad will come from all this. But I’m having trouble seeing the potential good. People all over the world survive and function on far less income than we do in the west. So it can be done.