Image Source: Mediahunter.
Picture this. It is 2045. The focus is on Generation Z, born roughly between the late 1990s and the late 2010s. They are almost exclusively the children of Generation X and are already known for their total immersion in technology. The oldest members of this cohort are now almost fifty years old, the youngest are about to turn thirty. Some commentators imagine today's children will enjoy future prosperity, thanks to the arrival of the Singularity. But no matter what their opportunities, like every other generation, they will be helped, hampered or hindered by their elders' legacies. Those legacies could be dire. Assuming the members of Generation Z are not dying in World War III or its aftermath, here is a snapshot of some problems today's children could face. The following is a purely hypothetical scenario, based on some ideas, perspectives and facts that are currently available.
In the United States, the generational story lurks behind every political discussion, although the politicians and pundits won't say it. Generational questions are rarely recognized in terms of what they truly are. In the view of some, this is: an older, dominant cohort, exploiting the younger population.
In December 2010, the national debt equated to "$91,500 per member of the U.S. working population." On 3 December 2012, the national debt stood at USD$16.3 trillion, which amounts to "$51,918 for every person living in the U.S." Politicians do not agree on how different economic policies will affect the growth and impact of that debt. Commentators argue over fundamentals. One side says that supply side economics is dead. Another side argues that consumer spending is dead. Yet another claims that energy shortages mean that economic growth will end.
Publicly held federal debt in the United States, 1790-2035. Source: Congressional Budget Office, Figure 1 of "Federal Debt and the Risk of a Fiscal Crisis" (July 27 2010). Image Source: Wiki.
Caption for the above graph: Federal debt held by the public as a percentage of GDP, historical data from 1790 to 2009, with projections until 2035. The extended-baseline scenario adheres closely to current law, following CBO’s 10-year baseline budget projections through 2020 (with adjustments for the recently enacted health care legislation) and then extending the baseline concept for the rest of the long-term projection period. The alternative fiscal scenario incorporates several changes to current law that are widely expected to occur or that would modify some provisions that might be difficult to sustain for a long period.
Congressional Budget Office: Debt held by public, long term scenarios (June 2011 report). Image Source: Wiki.
Alarmist and alarming discussions of the debt are dominated by America's conservatives, who made the debt the focus of their failed 2012 electoral bid. Paul Ryan claimed that "a computer simulation program of what would happen in the future 'crashes in 2037, because it can’t conceive of any way in which the U.S. economy can continue because of this massive burden of debt.'" The Republicans have posted a timeline of a personal public debt burden for a child born in 2010, here.
A Republican projection for Gen Z's loss of prosperity and wealth. Image Source: GOP.gov.
The GOP maintains that by 2050:
Other commentators in the US maintain that as far as the public debt and Generation Z are concerned, there will be hell to pay. Back in 2005, Reform Party supporter and Boston University professor Laurence Kotlikoff and journalist Scott Burns published The Coming Generational Storm: What You Need to Know about America's Economic Future; the book's blurb indicates that the authors largely renounce GOP solutions to projected problems, while generally agreeing on the GOP expectations of extreme generational economic distress:"If government spending is not immediately restrained, our nation’s public debt is projected to increase from $9.1 trillion in 2010 to $122.8 trillion by 2050. As a result, when children born today reach 40 years old, their share of the U.S. public debt will be $279,738—an increase of 859 percent above what it is today. For a family of four, the total household debt share would be approximately $1.119 million."
The alternate Reform agenda is characterized as a 'New New Deal.'In 2030, as 77 million baby boomers hobble into old age, walkers will outnumber strollers; there will be twice as many retirees as there are today but only 18 percent more workers. How will America handle this demographic overload? How will Social Security and Medicare function with fewer working taxpayers to support these programs? According to Laurence Kotlikoff and Scott Burns, if our government continues on the course it has set, we'll see skyrocketing tax rates, drastically lower retirement and health benefits, high inflation, a rapidly depreciating dollar, unemployment, and political instability. The government has lost its compass, say Kotlikoff and Burns, and the current administration is heading straight into the coming generational storm. ... Kotlikoff and Burns take us on a guided tour of our generational imbalance, first introducing us to the baby boomers -- their long retirement years and "the protracted delay in their departure to the next world." Then there's the "fiscal child abuse" that will double the taxes paid by the next generation. There's also the "deficit delusion" of the under-reported national debt. And none of this, they say, will be solved by any of the popularly touted remedies: cutting taxes, technological progress, immigration, foreign investment, or the elimination of wasteful government spending.
Other voices concur that neither the Republicans nor the Democrats have the answer to the debt crisis. There is a halting sense that a third way is needed. David Shulman at USNews:
Unfortunately the United States is now reminiscent of pre-1978 China where both political parties are held in thrall of ideologies that no longer work. For the Republicans the cure for all that ails us are tax cuts and severe cuts in projected entitlement spending. For the Democrats the cure is higher taxes on the wealthy, but because that avenue won't raise the money for their near mystical worship of the welfare state, a great swath of the middle class will soon see their taxes increased as well. ...
If the 2008 downturn should have taught us anything, it is to plan for future recessions. Remarkably, everyone is preoccupied with 'recovery,' and has made almost no attempt to address or resolve the problem of recessions' built-in periodicity. When government and banking authorities do try to prevent another economic downturn, every trick they have seems to ensure its return. Financial analysts take as a basic fact that recessions reappear roughly every 3 to 10 years; and really major downturns recur about every 10 to 15 years. This means that on top of everything else, Generation Z will be hit by two major economic slumps, probably in the 2020s and again in the 2040s. Their experience will be a much darker mirror of their Xer parents' struggles in the early 1990s, the early 2000s, and late 2000s.Simply put, after running a total of $5.1 trillion in deficits in fiscal years 2009-13 and with the debt held by the public soon (2014) approaching 80 percent of GDP, the United States will be approaching a level of indebtedness that makes an uncontrollable debt spiral more likely. Perhaps more insidious[ly,] neither party has a plan to bring the budget into balance. President Barack Obama's 10-year plan doesn't come close and the Ryan budget gets there, if you believe in very long run projections, in 2040. Moreover neither projection allows for any debt-exploding recession during the forecast horizons. So don't believe it when any politician tells you they are going to use the increased revenues or decreased spending they advocate to pay off the debt. All they do, at best, is to reduce the increase in the debt.
In these and other respects, others agree that Republicans and Democrats alike have failed today's children, who will shoulder the debt burden. The issue, once again, is not political: it is generational. The Boomers have numbers sufficient to determine any election; any politician will cater to their generation-specific demands in order to win at the polls. This means that if the Boomers choose to implement policies over the next 30 years which secure their futures at the expense of their successors, their will will be done.
Too often, critics say, this generation confuses its own welfare with the welfare of the country and even the world; and (critics continue) Boomers cannot be made to understand that their collective self-interest is not synonymous with the public good, because they genuinely believe that it is. This may seem odd for the cohort that reveled in cultural and moral relativism, but it is not, since the Boomers used relativism to destroy an old system of norms which emphasized vertical loyalties in our societies. They then built their own layer of social control, devised to emphasize horizontally-aligned values, in the name of new egalities (see my posts on this idea here and here; to repeat my point there: "Until we see that Boomers have created hierarchies masquerading as equalities, we will never get anywhere."). By the 2040s, these horizontal alignments will be as oppressive as any Boomer-condemned 1950s' patriarchy. In short, universalist altruistic language dresses up a generational self-service that will be enforced until the early 2040s, regardless of the party in power.
In 2005, Real Clear Politics reported:
All this doom-casting has won criticism from the Democrats, who claim that severe cutbacks in the name of debt reduction will be the actual cause in the decline in prosperity. They point to the need for increased taxes to repair and support infrastructure, education, social security, and public services as well as the debt. They are less able to explain why there were so few repairs to infrastructure in the economically healthy years of the mid-late 1990s. Democrats also condemn the Republican social welfare critique as an inhumane attack on the vulnerable, the poor and, above all, the elderly (i.e. the Baby Boomers).The fact is that this [Baby Boomer] generation's policy activists and political leaders - Democrats and Republicans - have piled enormous burdens of debt on today's children and their children, and there's precious little sign that they plan to lighten it.
Boomers: Social Security Will Run Up to 2037, So What's the Problem?
Video Source: Youtube.
Democratic projections extend to 2021, and expected numbers for the 2010s are acknowledged by pro-Democrat sources as the "highest amount of government spending since World War II." Democrats argue that Social Security will stay solvent until 2037. That covers all the Boomers and even a few Gen Xers (but only at the start of their retirements). A conservative blog angrily quotes Bernie Sanders, Democrat Senator for Vermont (see video above) from a 2011 press conference:
It is easy for Democratic critics to dismiss conservative fears as misanthropic, classist, élitist and toxic anti-leftist political games. But it is still breathtaking to see those same Democrats argue that benefits will pay out until the late 2030s, so what's the problem?"Social Security has been the most successful social program in the history of this country. We are getting sick and tired of the Republicans telling us that Social Security is collapsing when the reality is that there is a $2.6 trillion dollar surplus in Social Security and it can pay every benefit to every eligible beneficiary for the next 27 years!"
Complacency around that date is astounding: it leaves Generations X, Y and Z completely out in the cold. How can you claim to be the arbiter of public morals and communal virtues if you would blithely disenfranchise your own children? How can you claim to be a keeper of public trust, when you keep that public trust based on a future gross violation of that trust?
In this picture, the first people to feel that violation of public trust, to see how badly the system will let them down, will be Generation Xers. If you are a Gen Xer paying into the system right now, right-wing pundits argue, do not expect that you will ever see that money back in the form of a pension. Your payments (conservatives claim) - barring changes to the social security system - will likely never come back to you. They will fund, in their totality, the needs of the Baby Boomers. And right at the point where Gen Xers will begin retiring and need social security, pension, medical or welfare support, the system will collapse. Gen Y and Gen Z - again barring radical systemic changes - will never even glimpse the Promised Land of the Social Welfare state's secured future.
An anti-social security argument now attempts to cut off Boomers before they (hypothetically) bankrupt the system. But, Sanders assures his supporters: "We will not let that happen." Again, the self-interest of one generation is confused with, and expressed in the language of, the general good.
The problem is that the political debate skews any rational discussion of the reality at hand. The problem, again, is not political. It is generational. There is a difference between supporting social welfare policies for all, which is a genuinely altruistic and desirable aim, and supporting social welfare policies for some, with a failed promise of social welfare for others.
The widening gap between rich and poor in the USA will lead to social unrest: Zbigniew Brzezinski.
Video Source: The Daily Beast.
All the same, the built-in inequality and growing gap between rich and poor to which Republicans cleave (left-wing critics say) is no less despicable. Financial workers once made the same amount, or less, of money as anyone else in the professional middle classes. In the 1980s, financial industry conditions changed, and the middle classes split between the very wealthy and the increasingly poor.
Clip from Inside Job (2010) © Sony Pictures. Video Source: Youtube.
Critics argue that the banking and corporate sectors have totally violated public trust. They are no longer even dimly aware of their ultimate mandate of public service. According to anti-conservatives (and even some conservatives), there is no public good left in the halls of profit. The purpose of wealth is self-engorgement; and the wealthy believe that their wealth comes rightfully at the expense of those who are 'not as able' in a dog-eat-dog world. And this is so, not because the wealth of a country cannot improve the lot of the inhabitants in general (because it can, under certain conditions). Rather, everything to do with so-called 'trickle-down' effects rests on the fundamental decency of the wealthier classes, on whether or not they are 'gentlemen,' in the archaic sense of the word. And they no longer are.
Fairer distribution of wealth in this picture depends on the sense of responsibility of the wealthy toward their employees, communities and country. The 2010 documentary, Inside Job, demonstrated systemic corruption and the self-righteous, greedy and exploitative mentality of the financial sector. Given examples like the LIBOR scandal, a non-political case can be made that the wealthy establishment has lost its way. The LIBOR scandal is emblematic of a much larger betrayal and it is a disgrace.
Code words sum up this breach of public trust: 'transparency,' 'accountability.' But even in the wake of 2008's disastrous recession, many wealthy Boomers (right-wing or not) believe that wealth confirms their innate virtues, especially their talented ability to work their way up in the world (when their earlier lives spanned a period of nearly continuous growth); and convinces them solipsistically of their own altruism. Oftentimes for the wealthy, their grasp of social responsibility and charity carries value judgments about the 'needy,' i.e. the middle classes and the poor as lesser beings who could not compete, could not plan, could not work hard enough, are lazy and incapable, and so on; trickle down money comes with political strings attached, and condescension, and power plays. There is no sense that the 'needy' operate in a system which has been compromised. There is no awareness that part of that bankruptcy comes from exploitation and broken trust. And there is no understanding that the American Dream concept of competitive equal opportunity cancels out the original older British tory idea (long since corrupted) that the person at the top of the ladder is never better than the person at the bottom, and all are equally bound by mutual duties toward one another.
Much political hay is made over government regulation, an outside control to enforce public decency. The notion that regulation must derive from an external force to achieve uniformity gradually lifts responsibility from the individual, until the individual need never do any moral heavy lifting, need never be accountable to himself or herself, or anyone else (except as demanded by politically-flavoured laws; and if you don't agree with the political flavour, need you stay within the bounds of legality?). At the same time - if the behaviour of Wall Street traders in the early 2000s, people who pumped up bubbles recklessly and assumed ahead of time that public money would bail them out when they got in too deep, is anything to go by - individuals can indeed no longer be trusted to be responsible for themselves and the consequences of their actions. They apparently cannot do any personal moral heavy lifting. How can the government govern us, if we cannot govern ourselves? Bill Fleckenstein asks: "How did our great country, a bastion of capitalism, devolve into a Bailout Nation where the gains were privatized, but the losses were socialized?"
Whether left or right, political viewpoints are two sides of the same coin, and point to the same deep malaise.
And therefore, no matter how you spin this mess, Gen Z members will be reduced to indentured servitude to support an ageing population much larger than they are. And that older generation just happens to be fixated on rejuvenation and anti-ageing treatments; and many will have the funds to purchase these treatments to significantly prolong their retirement lives. Thus the burdens will only increase. Just Facts:
These incredible debt and tax payments will not go to help Generation Z or their successors (sometimes known as Generation Alpha), but continue to support (barely) the elderly Baby Boomers and perhaps Generation Jones. They will not be enough to help Generation X's retiring numbers. The Peter Peterson Foundation's (conservatively-aligned) 2012 fiscal summit report: "The aging of the U.S. population will affect Social Security’s finances. In 1960, there were 5 workers paying taxes to support 1 Social Security beneficiary. Today, there are only 3 workers per beneficiary. By 2030, there will be only 2."In a 2012 commentary published in Rolling Stone, Jared Bernstein, a former economic advisor to President Obama and a senior fellow with the Center on Budget and Policy Priorities, wrote that "it is well within our means" to reduce the national debt by following the "broad outlines" of "current law." He advocated that we take this path without revealing that under current law, federal taxes will progressively consume a greater share of the U.S. economy due to bracket creep, rising to 21% higher than the average of the past 40 years by 2025, 40% higher by 2045, 56% higher by 2065, and 66% higher by 2085.
And speaking of the workplace, there are other generational legacies to consider.
In this hypothetical future, Generation X's belated attempts to appease their predecessors and their successors in a critical pan-generational initiative also fails, because politics has twisted and confused all the terms of discussion on generationally-determined topics. Since Generation X's entire lives were spent in one big act of crisis management, introspection and (failed) Boomer damage control due to a lack of cohesive action, the bulk of research and development, marketing, propaganda, and political power in a dystopic technocracy will fall to Gen Y.
Millennials in 2012: like many Gen Xers, they faced a recession at graduation and years of student loan debt. Video Source: Youtube.
Generation Z will have ahead of them a huge forerunning cohort in the Millennials. No matter how technology will change job conditions in the coming decades, all-too-human hierarchies are sure to remain. If the current entitled disposition of Generation Y is anything to go by, Millennials will be in positions of authority and unlikely to give up those posts for another two decades. Gen Y will have finally reached the top, after decades of dealing with the after-effects of the 2008-2012 recession, downward mobility, pandering to Boomer bosses and struggling with embittered Gen X managers. It spells a lifetime of nightmares for them, which they are only starting to understand.
Because of everything they will have gone through, Millennials will not age gracefully, or kindly make room for workers coming up in the workplace behind them. From Gen Z, they will want team players and 'yes men' and respond harshly to criticism or calls for reform.
In Britain, rising university fees in the 2010s may lead to unprecedented decreases in the number of people seeking a tertiary education. This does not necessarily mean non-college-graduates are less able to compete and engage in debate with their better-schooled predecessors. However, the resulting cultural imbalance could provide an excuse to entrench class-based, social and economic inequalities at the expense of Generation Z. The decrease in university-educated might also create a political watershed between older, educated progressives and a younger, differently-educated generation. An added dimension may involve the evolution of a three-tiered tertiary educational system: private, public and online universities. Will those who receive their degrees via Internet programs in the 2020s, the 2030s and the early 2040s be deemed second-class citizens?
As a result of upheavals in tertiary education and other cultural inequalities, such as an ever-growing gap between the rich and the poor, expect politics to migrate outside the conventional confines of the electoral system and out into the streets or onto the Web, where it will mutate rapidly. Successes will mount for radical, populist and anti-élite parties where younger populations dominate. Those populations may turn to more extreme forms of protest and activism.
In this situation, the young will not have any support from British traditions or older social values, given a 70 year attack on any and every non-horizontally-aligned value which ran counter to a grand liberal experiment. As far as generational legacies are concerned, even the left-wing Guardian worries that, somewhere, somehow, the baby got tossed out with the bathwater in the face of vast progressivism:
Once again, a commentator is pin-pointing something critical in this unfolding situation: these problems are not politically determined; they are demographic in origin. They reveal what happens in a democratic system when one demographic group dominates in terms of numbers, and votes according to self-interest. That self-interest will be upheld regardless of politics, and will always be justified by Boomer theorists as a policy enacted in the name of the general good.There is no longer any discrimination in our embrace of cultural liberalism; it stretches into every nook and cranny of our lives – from the financial markets to sex – and sometimes with consequences none of us like. It was Howard Davies, when he ran the Financial Services Authority, who compared financiers to consenting adults; the inference was that he had no more business inquiring into their private business affairs than he would into what went on in their bedrooms. His liberalism has been proved wrong. The story of the past six decades is in many ways the story of how we threw off our shackles only to discover that we do need some constraints, even in the City. And in the bedroom? Our extreme liberal stance has seen us deluged under a tidal wave of pornography. The debate in the years ahead will not be about how to continue with our baby boomer liberalism, but over how and where we need restraint around some shared principles and rules.
Very ironically, this means that liberal Boomers and conservative Boomers alike are perfectly capable in their old age of seeing eye to eye, and swinging together toward authoritarianism with a grab bag mix of left and right elements.
Therefore, 'we need restraint around shared principles' will translate into repression in the one area where Boomers will in time be less comfortable: technology and related cyber-economies, cyber-communities and cyber-communications. Already, there are signs that an authoritarian régime is in the works around social networks, mobilized against anyone labeled a 'cyber-terrorist.'
Gen Xer Julian Assange, from his perch in London's Ecuadorian embassy, plays the canary in the coal mine. He argues that Gen Z will be ensnared in a terrible future; and technology's great promise of future prosperity, the Singularity so hoped for by the Boomers, will not be Gen Z's source of potential liberation. Technology will be co-opted by Boomer leaders to ensure Gen Z's enslavement in the dystopic technocracy (thanks to -M.):
The way out of this cul-de-sac is the supposed increased productivity, growth and prosperity which will arise through technological innovation. But not all economists are certain that technology assures continued profits and wealth.we are sleepwalking towards a "new transnational dystopia". ... "The internet, our greatest tool of emancipation, has been transformed into the most dangerous facilitator of totalitarianism we have ever seen" – and its target audience anyone who has ever gone online or used a mobile phone.
"The last 10 years have seen a revolution in interception technology, where we have gone from tactical interception to strategic interception," ... [Assange] explains. "Tactical interception is the one that we are all familiar with, where particular individuals become of interest to the state or its friends: activists, drug dealers, and so on. Their phones are intercepted, their email communication is intercepted, their friends are intercepted, and so on. We've gone from that situation to strategic interception, where everything flowing out of or into a country – and for some countries domestically as well – is intercepted and stored permanently. Permanently. It's more efficient to take and store everything than it is to work out who you want to intercept."
The change is partly down to economies of scale: interception costs have been halving every two years, whereas the human population has been doubling only every 20. "So we've now reached this critical juncture where it is possible to intercept everyone – every SMS, every email, every mobile phone call – and store it and search it for a nominal fee by governmental standards. A kit produced in South Africa can store and index all telecommunications traffic in and out of a medium-sized nation for $10m a year." And the public has no idea, due largely to a powerful lobby dedicated to keeping it in the dark, and partly to the legal and technological complexity. So we spend our days actively assisting the state's theft of private information about us, by putting it all online.
"The penetration of the Stasi in East Germany is reported to be up to 10% of the population – one in 10 at some stage acted as informers – but the penetration of Facebook in countries like Iceland is 88%, and those people are informing much more frequently and in much more detail than they ever were in the Stasi. And they're not even getting paid to do it! They're doing it because they feel they'll be excluded from social opportunities otherwise. So we're now in this unique position where we have all the ingredients for a turnkey totalitarian state."
Time recently published an article asking whether continued growth is a given, considering that technology could impair the productive capacity of an economy. On this topic, Time quotes Silent Gen economist Robert J. Gordon of Northwestern University. Gordon envisions a future in which we are up to our eyeballs in technology, but our productivity with regard to making real things in a real economy has diminished almost to nothing, with an attendant decline in the standard of living:
Berlusconi: I wouldn't want to be you.[I]s there reason to think that kind of technological advancement — and the resultant economic growth — will continue indefinitely? That’s a question that Robert J. Gordon, an economist at Northwestern University, posed in a recent working paper. Gordon argues that most of the economic growth in the U.S. has been prompted by three separate industrial revolutions: the first occurred between 1750 and 1830 and brought us steam engines, cotton spinning and railroads; the second, between 1870 and 1900, brought electricity, running water and the internal combustion engine; and the third, between 1960 and the end of the 20th century, brought computerization and the Internet.
“The computer and Internet revolution (IR#3) began around 1960 and reached its climax in the dot.com era of the late 1990s, but its main impact on productivity has withered away in the past eight years. Many of the inventions that replaced tedious and repetitive clerical labor by computers happened a long time ago, in the 1970s and 1980s. Invention since 2000 has centered on entertainment and communication devices that are smaller, smarter and more capable, but do not fundamentally change labor productivity or the standard of living in the way that electric light, motor cars or indoor plumbing changed it.” ...
“A thought experiment helps to illustrate the fundamental importance of the inventions of IR #2 compared to the subset of IR #3 inventions that have occurred since 2002. You are required to make a choice between option A and option B. With option A you are allowed to keep 2002 electronic technology, including your Windows 98 laptop accessing Amazon, and you can keep running water and indoor toilets; but you can’t use anything invented since 2002.
Option B is that you get everything invented in the past decade right up to Facebook, Twitter, and the iPad, but you have to give up running water and indoor toilets. You have to haul the water into your dwelling and carry out the waste. Even at 3 a.m. on a rainy night, your only toilet option is a wet and perhaps muddy walk to the outhouse. Which option do you choose?”
Before former Italian PM Silvio Berlusconi was convicted for tax fraud in 2012, he acknowledged that Millennial Italian youths face a lousy economy engendered by Boomer attitudes toward profits through speculation and pensions. He advised today's young people that their only real option was to marry a rich old woman or find a Sugar Daddy. His good humour evaporated, however, when he had to deal with a violent Occupy protest in 2011.
Berlusconi is actually a member of what is known in America as the Silent Generation (another example of Boomers bequeathing an unwanted and inaccurate epithet upon an adjacent generation, which sadly stuck). But in Europe, he epitomizes the Boomers who got rich during the mid-late 1990s and early 2000s and walked away leaving the cost on younger people's shoulders. Boomers are known collectively and dismissively in Italy as the "Cinquanta/Sessantenni," i.e. the people in their fifties and sixties; in Italy and other parts of southern Europe a picture of "little Berlusconis" exploiting the young without consideration of the consequences is common.
Even though this is certainly not the whole truth of the European Boomer experience, the decadent stereotype will not be forgotten by Europe's Generation Y and Generation Z children.
The recession will find its way to France and Germany in the 2010s, as will demographic tensions. Der Spiegel:
During the Great Recession, Generation Z's parents and older siblings will join the so-called 'floating' generation, who are unable to find employment and hence will never become established, tax-paying adults. This legacy is also passed to Generation Z. NYT:The unsolved generational conflict in the south [of Europe] provides a foretaste of what could await Germany in the future, too. It was only a few years ago that the then "grand coalition," a government comprised of Chancellor Angela Merkel's conservative Christian Democratic Union and the center-left Social Democratic Party, pushed through a "pension guarantee" that prevents cuts to benefits for the elderly even if wages sink for young workers. Behind this decision was the fear there would be a backlash among outraged pensioners in the next election, but the additional costs will total some €18 billion ($22 billion), according to a study conducted by the Kiel Institute for the World Economy, a prominent German think tank.
The culture of exploitation of labour and decline in workplace mores and standards which permitted this nightmare to unfold in the 2010s will only worsen in the 2020s and 2030s. European banks, businesses, industries and urban service industries will face growing labour shortages as younger people withdraw from the cities.“It’s a disaster for everyone,” said Jean Pisani-Ferry, who runs the economic research center Bruegel in Brussels. “They can’t get credit, and they’re treated awfully by employers. And then there are all those young people in jobs that don’t match their skills.” The labor market, he said, is “deeply dysfunctional.”
Throughout the European Union, unemployment among those aged 15 to 24 is soaring — 22 percent in France, 51 percent in Spain, 36 percent in Italy. But those are only percentages among those looking for work. There is another category: those who are “not in employment, education or training,” or NEETs, as the Organization for Economic Cooperation and Development calls them. And according to a study by the European Union’s research agency, Eurofound, there are as many as 14 million out-of-work and disengaged young Europeans, costing member states an estimated 153 billion euros, or about $200 billion, a year in welfare benefits and lost production — 1.2 percent of the bloc’s gross domestic product.
The potential aftermath of a euro collapse and EU implosion and reorganization will devastate Gen Z and their predecessors, who return to the countryside to practise subsistence agriculture in order to survive. Other European Gen Xers and Millennials leave for other parts of Europe, or forsake the Continent altogether, in search of employment abroad.
Gen Z children grow up in a technologically connected world, but disconnected from their parents' past communities. Zers grow up inside the developed world's pockets of squandered prosperity. These children become the world's first true international citizens, open to any and every radical proposal that will ease their distress and alienation. They also refuse to support, or act as cannon fodder in, any brooding conflicts in a crumbling Europe.
Image Source: Popsop.
In the Middle East and Africa, Latin America and the Asian Pacific, Generation Z dominates the population in terms of numbers, which gives them a slightly different profile than in other places.
In the Middle East, Generation Z's tech-savvy predecessors initiated the Arab Spring. Will the future of Generation Z in these areas see growth and renewal instead of despair? Much depends on the outcome of current political developments and the state of the energy industry. Some analysts claim that oil in the Middle East will run out by 2050; others claim that by 2050 there will be a significant decline in oil production. Either case would leave the region in decline and turmoil. This may lead to economic booms and opportunities for Generation Z in countries with Arctic oil interests, such as Canada, the US, Norway and Russia. But Gen Zers may equally become embroiled in Arctic conflict.
There are some indications that Generation Z may enjoy prosperity in developing nations by establishing new technological movements and initiatives. From the earliest age, they have been active on the Web and their parents have not fully grasped the extent or meaning of their activities. Perhaps Zers will become denizens and leaders of a fully-fledged cyber-Underground or new cyber State. It is from these real world locales and corresponding virtual strongholds that a generational backlash might originate, because, as Assange has indicated, not all of these innovations will be greeted with delight by Boomers.
In Japan, Generation Z members have been exposed to massive doses of Fukushima radiation for their entire lives. As small children, their own state and society - even their parents! - betrayed them: they participated unknowingly in fallout clean up, and were even fed radioactive food in school lunches. The people of this generation confront a second wave of debilitating cancers, thyroid and heart problems. Their Gen Y predecessors were bought off with plush appointments and deny the post-Fukushima toxic reality that unfolds in front of them, even as that reality consumes them.
Japan's dire economic situation promises little by way of recovery for succeeding generations. By the 2040s, Gen Z members will greet their predecessors' retreat into hyper-nationalism and revived militarism with disillusionment and alienation, since Zers will be the ones expected to pay the price for hawkish policies.
Japan's lost decades will prove the forerunner for the world's lost decades. Economic collapse, dragged out over years, will go hand in hand with declining birthrates:
"silvers," which is what the Japanese euphemistically call their senior citizens, will make up 40% of the population by 2060 despite the fact that the total Japanese population is expected to shrink by 1/3rd over the same time frame.
The implications of this demographic shift are tremendous. The newly elected Abe-san can print all the money he wants. He can build more bridges to nowhere and even double the Bank of Japan's inflation target to 2% if he likes.
It won't make any difference on anything other than a short-term basis.
That's because Japan crossed the point of no return and became a "post mature" society in 1995, according to the National Intelligence Council. The term, in case you're not familiar with it, means that there is a disproportionately large number of older people in a given society versus the younger productive and reproductive population.
Put another way, the country's "window of opportunity" quite literally closed.
Many people are surprised to learn that the United States is in the same spot. But they are positively stunned to learn that our window of opportunity closes in 2015 -- only three years from now, when we, too, become a "post mature" country, and the median age climbs above 45 for the first time.
In vehement denial that we're heading down the same path, they explain away the mountains of debt, the failed stimulus, the out-of-control corporations and complete political disarray. But they cannot explain away the demographics here anymore than they can in Japan.
When Japan's markets fell in 1990, the numbers were already going in the wrong direction. The productive-age population had peaked and was in decline. Ours is, too. In fact, so is most of Europe's.
Twenty-two years later it's no surprise that there are fewer jobs and fewer Japanese workers. Nor should it come as a shock that the island nation is reevaluating its immigration policy, its military, and its role in the international community. There are huge, multi-year impacts that are directly related to fertility rates, not the least of which is the inability to kick-start its corporations.
Here in the United States, for example, we tend to think that immigration will be the miraculous do all, end all. Our fiscal survival, in fact, is predicated upon it. In reality, it makes almost no difference whatsoever.
For instance, the Center for Immigration projects that immigration will increase the working age population to 58% of the total workforce by 2050. That's only 1% above the 57% projected rate with no immigration. If immigration falls, our population curve is indistinguishable from Japan's over the past 50 years.
As for the notion that immigrant children have more children (which is a key assumption in United States population-planning projections) -- that, too, is flawed. Not only does the data now show immigrant fertility rates are falling, but it also shows that fertility differences between American-born women of child-bearing age and immigrant women of the same age are not enough to increase the share of people falling into the productive working category.
In other words, immigration has only a minimal impact, if any, on slowing down the decrease in working-age population by 2050. Put another way, there are presently 4.81 workers supporting every retiree over 65 in the United States. By 2050, this figure will shrink to 2.81 workers when you include immigration, and only 2.31 workers without. Remember, Japan's figure is 2.8 today and has dropped since the 1990s.
Video Source: All Girls Allowed.
In India, as in China, these countries' projected economic domination is marred by a different kind of imbalance for Generation Z. Decades of informal birth selection practices favouring the survival of male children lead to a crisis, wherein the population tilts toward an unsustainable gender imbalance of males over females: "by 2020, China will be home to 40 million more men than women under the age of 20." In China and India, a large percentage of boys born in the opening Millennial decade simply will not marry. That will be a harsh fact for them and their families to comprehend and absorb.
At the height of their disaffection, these young men will face a huge bulge in the Asian generational counterparts to ageing Boomers; that demographic shift will see China consumed by economic decline:
As a result of the country’s low fertility rates since the early 1990s, China has already begun experiencing what will become a sustained decline in new entrants into its labor force and in the number of young migrants. The era of uninterrupted supplies of young, cheap Chinese labor is over. The size of the country’s population aged 60 and above, on the other hand, will increase dramatically, growing by 100 million in just 15 years (from 200 million in 2015 to over 300 million by 2030). ... China’s astonishing economic expansion over the past two decades took place within a highly, almost uniquely favorable demographic context. But the country is at the end of reaping economic gains from a favorable population age structure. ...
The gender ratio and generational imbalances are equally catastrophic in India: "the current capacity constraints in education and training continue AND ... current trends in female foeticide continue apace, so that India finds itself with the world's largest population of young men: uneducated, unemployed and sexually frustrated." You can see a projection of demographics and related economic conditions in India and China in 2025 here and a similar analysis running from 2005 to 2100 here. The latter source summarizes:For the most part, China has exhausted its demographic fortune as measured by the demographic dividend—that is, by the changing support ratio between effective producers and effective consumers. ...
By 2013 China’s demographic dividend growth rate will turn negative: That is, the growth rate of net consumers will exceed the growth rate of net producers. Starting in 2013, such a negative growth rate will reduce the country’s economic growth rate by at least half a percentage point per year. Between 2013 and 2050, China will not fare demographically much better than Japan or Taiwan, and will fare much worse than the United States and France.
As a result of China’s very low fertility over the past two decades, the abundance of young, inexpensive labor is soon to be history. The number of workers aged 20 to 29 will stay about the same for the next few years, but a precipitous drop will begin in the middle of the coming decade. Over a 10-year period, between 2016 and 2026, the size of the population in this age range will be reduced by about one-quarter, to 150 million from 200 million. For Chinese aged 20 to 24, that decline will come sooner and will be more drastic: Over the next decade, their number will be reduced by nearly 50 percent, to 68 million from 125 million.
Such a drastic decline in the young labor force will usher in, for the first time in recent Chinese history, successive shrinking cohorts of labor force entrants. It will also have profound consequences for labor productivity, since the youngest workers are the most recently educated and the most innovative. ... looming demographic crisis will largely define China in the twenty-first century.
In the worst case scenario, familial hopes and honour will fall by the wayside while these 'angry young men' begin to take matters into their own hands."Longitudinal indicators of marriage squeeze indicate that the number of prospective grooms in both countries will exceed that of prospective brides by more 50% for three decades in the most favorable scenario. Rates of male bachelorhood will not peak before 2050 and the squeeze conditions will be felt several decades thereafter, even among cohorts unaffected by adverse sex ratio at birth [SRB]. If the SRB is allowed to return to normalcy by 2020, the proportion of men unmarried at age 50 is expected to rise to 15% in China in 2055 and to 10% in India in 2065, and the marriage squeeze will remain perceptible until 2100. India suffers from the additional impact of a delayed fertility transition and its impact on age structures."
In the developed and developing worlds alike, Gen Z will emerge from ideologically divided and morally confused societies, where decades of anomie, cynical politics and demographic imbalances have taken their toll. Even for those Zers who indulge nostalgia and retreat to pre-tech traditional values in anti-tech social movements, old norms will simply no longer work in 2045. But by 2045, brand new norms could be imagined, and they might shock today's sensibilities.
For Generation Z, the generational social contract will not only have been broken; it will never have existed, except in childhood memory. Recollections of pampered childhoods (or at least childhoods without total privation) will only fuel their rage. Hemmed in from all sides, Generation Z will have had their futures accounted for decades before they were even born. They will be offered little human support in a global dystopia, a gadgetized, high stress, streamlined and instrumentalized technocracy. They will also be surrounded by a minefield of brewing conflicts in global affairs.
If you were a member of Generation Z in 2045, how would you judge the people who came before you? What would you do? How angry would you be? Why would you continue to pay into a system and support an establishment that will never, ever support you? Wouldn't it seem logical to many among that younger generation to overthrow and obliterate the system instead? It seems unimaginable, but think - really think - of how it would feel to stand in Generation Z's place in the mid-21st century.
With the gross abandonment of responsibility toward this generation, with their lives so heedlessly pre-mortgaged against our present, will Generation Z turn to revolution? They might revisit 1848 in a way that makes Gen Y's Occupy movement look like a little walk in the park. Generation Z might spawn a much more violent revolutionary thinker than Marx. This generation might call for a complete destruction of the whole order that let them down. Moreover, they could band with their successors (who have even less hope) to act upon a murderous radical agenda to destroy and transform global society in the 2050s.
This future does not have to happen, but so far, many signs point in this direction. The next time you see a small child, think of what we all, every last one of us, owe Generation Z. As we owe everything to those who made sacrifices in the past, so we owe everything to those whose lives will be sacrificed in the future, for the sake of our past and present. Have the prejudices, vanities and shortcomings of the recent past and present really been worth this hypothetical monstrous future failure? We must make things better for Generation Z.
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