Monday, June 24, 2013

Working on the Long Descent

Ed at Gin and Tacos, lambasts the stupidity of a Price Waterhouse study that criticizes "Gen Xers" for not getting with the program.

Tsk-tsking at the younger generations manages to magnificently miss the point.  This is what economic contraction looks like.  But no one wants to even imagine what the end of economic growth means, so we keep pretending to each new generation that they can have it as good or better than earlier generations.  If that's not working out, then there must be some mysterious flaw in them or their strategies.  They're not working or they're complacent or they're not as assertive as the union-members of the past.

But the contraction's been going on a long time and it's been working it's way up the through society, like water dissolving a pyramid of sugar.  It's reached people, who did what they were supposed to and got an education, who worked and sacrificed for careers, who even saved and invested - and who are much worse off than they'd expected to be.  And it's moving up past them - removing the possibility of the old imagined success even further away.  (Years ago someone like Ed might look around his milieu and see some people succeeding and some failing - but now he looks around and he sees no one who has built the kind of career they'd been lured on with.)

The powers that be keep printing money and flinging it onto the top of the pyramid, but it doesn't do anything there really.  It's not being invested in anything but financial tricks, because people down the pyramid not only don't have money to spend on some new product, but they are being idled and underused in an economy that doesn't know what to do with workers other than employ them to provide crappier and crappier services to one another at narrower and narrower margins.

Increasing income inequality may be speeding the spread of contraction, but I don't believe it's the cause.  It's the powerful trying to hold onto their privileges as the proverbial pie shrinks.  (We should push back or course . . . )

This is the second time already this week, I'll try to imagine advice I'd give, but I'm  getting restless with critique.  After all, I have a fifteen year old son, and what will I tell him?

Learn to do something that even people without much money will pay for.   Don't count on a wage to meet your every need.   If you don't have a family network to invest in and draw from, try to find a way to put roots into a social network.  Know that the older generation doesn't understand the economic world we live in even though they will judge you as if they do.  Take advice (like this) with a grain of salt and look around.   Find the things that you value - especially those things within your means.  Again, see what you can do with your hands and brain that people will value.

There's more I could say, but a 15-year old will only stand still for so much advice.

What would you say to a person setting out?