Clinging to the Torch
Not all Boomers share the same views, and some, I assume, are good people, but it is time that young conservatives take note of this dynamic and assert themselves more forcefully in the politics.
The views and opinions expressed in this article are those of the author and do not necessarily align with those of The American Postliberal.
Modern conservatism has an age gap problem. By all available metrics, life for young Americans, and especially young men, is the hardest it has been in generations. The most recent statistics show that barely a third of thirty-year olds now own a home, around half are unmarried, and over a quarter are still stuck paying crippling student loan debt.
These are all benchmarks that have significantly worsened over the past few decades. Now, new evidence suggests that the unemployment rate for those with a college education, which was once billed as a ticket into a secure lifestyle, is now lower than that of the general public.
Yet, confronted with these problems, many mainstream conservatives offer few if any tangible solutions. A cursory glance at the latest Fox News broadcasts will leave one nauseated with the same stale platitudes – “go work at Panda Express!,""stop playing video games,” or “have you tried renting an apartment in rural Mississippi?” Seriously?
The problem is generational. As the children of the postwar era, Boomers inherited an economy with high growth, a robust industrial base, tight labor markets, and historically low inflation. In 1985, it took the average male worker 30 weeks of work to afford the basic necessities of a middle class life, those being: housing, family health insurance, a car, and a semester at a public college or a university.
In 2019, that number was 53 weeks.1 Rather than trying to preserve those favorable economic conditions for future generations, however, many older conservatives have exerted a selfish chokehold on our politics intended to advance two main ends: protect their pensions and keep asset prices inflated.
The former is best illustrated by the refusal of either party to consider any reforms of Social Security. The latest estimates suggest that the program will turn insolvent by 2034, leaving millions of workers paying into the program likely unable to reap any of its benefits when they retire.2 Evidence also suggests that the boomer generation is currently receiving a payout much greater in value than what they paid in with payroll taxes during their working years.3
Anyone who dares to suggest any solution to this problem – whether it be privatization, means-testing, or even just slightly raising the retirement age – is ignored or vilified by both political parties. Perhaps this is to be expected of the Democrats, who at this point have come to embrace Modern Monetary Theory as economic gospel, but the Republican Party still, at least nominally, claims to champion fiscal responsibility.
The consequences of the GOP’s refusal to confront the Social Security gravy train are multifaceted. First, it will ensure that real, productive discretionary spending such as that on infrastructure, industrial policy, or family policy will continue to be crowded out by more pension bailouts. Already, the result of excessive pension spending has been that the federal government spends around $5 on seniors for every $1 it spends on children, even as the birthrate collapses.4
Second, refusing to reform Social Security will likely cause the U.S. government to take on more debt to keep the program solvent, saddling future generations with the burden of paying interest on this debt and strangling our financial flexibility. The losers of this dynamic are not only young Americans, but the future of the nation as a whole.
The second, and perhaps even more insidious element of the “generational divide” is the incessant focus on inflating asset prices at the expense of the livelihood of Americans. Baby Boomers own a disproportionate majority of assets, such as stocks, bonds, and real-estate, with a share of over 51.8%. By contrast, Millennials and Generation Z jointly own just 9.4%.
Notably, this phenomenon is a drastic shift from only thirty years ago, when “young Americans held roughly twice as much in proportional assets as they do today,” according to a recent report.5
The inflation of asset prices depends on easy credit and a highly financialized American economy. This financialization has been driven by a deregulation of the financial sector that has disconnected its performance from the real economy. Many older conservatives have supported this action, arguing that it is consistent with the principles of “the free market.”
The tangible result, however, has been increased speculation and asset bubbles such as the one that caused the Great Recession of 2008. Such deregulation has also increasingly channeled profits towards financial markets instead of towards productive activity.
For example, whereas corporations used to retain and reinvest around half of their earnings on real capital, today this share has fallen to just ten percent with the rest paid out to shareholders in the form of stock buybacks.6 The result is a stronger 401K for boomers, and fewer jobs for future generations.
Another aspect of this equation is trade. The financialization of the American economy is sustained by purchases of American assets and debt by foreign capital, which occurs because the United States runs persistent current account deficits with other nations. The trade deficit is a fairly recent phenomenon, as prior to the mid 1970s the U.S. routinely ran surpluses. Even later in the 1990s, manufacturing employment remained relatively steady.
The decision to sell out America’s industrial base to foreign nations was a conscious one. Part of this choice was motivated by ideological sympathies towards globalization, but another factor was certainly the massive payout for the asset-rich classes even as the broader country deindustrialized.
Last, this discussion would not be complete without addressing perhaps the issue on which baby Boomers and Generation Z conservatives disagree the most – immigration. Whereas opposition to both legal and illegal immigration is growing among young conservatives, many baby boomers insist on maintaining the obsolete “legal good, illegal bad” dogma. Again, key to understanding this disconnect is the generational dynamic.
Boomer conservatives no longer have any need to find a job, they have already experienced their formative years in a society that was still relatively high trust, and actually benefit from mass immigration boosting the prices of their real-estate assets.
Generation Z conservatives, on the other hand, increasingly grow up in radically transformed communities, are forced to compete with H1B migrants for jobs, and are often locked out of the housing market entirely.
Despite this, partially because of persistent Baby Boomer dominance of the GOP, it does not appear that any meaningful action to reduce legal immigration levels is yet on the horizon.
Much ink has been spilled debating what factor best explains power dynamics within contemporary American society, whether it be social class, or race, or religion, or some other factor. However, it is clear now that American politics must also be understood generationally.
Throughout American history, an integral part of the social contract was the idea of the “passing of the torch,” the notion that each successive generation would have a central role in governing the nation during its prime years. Many boomers have rejected this tradition, instead clinging onto political power to enrich themselves at the expense of their descendants and the overall future of the nation.
Of course, not all Boomers share the same views, and some, I assume, are good people, but it is time that young conservatives take note of this dynamic and assert themselves more forcefully in the politics. Boomers are on their way out. It’s time for the younger generations to be offered the torch.
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American Compass https://americancompass.org/speculating-wall-street-investment/
For the love of God means test social security. Care for elders who lack resources is one thing but my own parents call social security their "fun money" while I pay into a system I know I will never get a dime out of.