Today we are enjoying the fruits of a politics founded, at its core, on the principle that the wealthiest, most powerful people in our society feel ill-used by the political system they exert an almost unfathomable amount of control over. They feel that someone, somewhere, must be pulling one over on them, whether it's immigrants, ethnic minorities, the poor, public school teachers, or climate scientists.Many people find this difficult to understand, or at least they pretend to. I don't find it difficult to understand at all. On the contrary, nothing could be more natural. What I would like to do today is give you a little pep talk, so that when you're a bit older, you might not feel the same impulse to sabotage our civilization out of generational grievance.
In 30 years the GDP of the United States will be much larger
Right now our political class is engaged in a posturing game over what rate of near-term growth we can squeeze out of our economy this late in the business cycle. In some ways, this is an extremely urgent agenda: higher economic growth rates, like all growth rates compounded over long periods, result in wildly different end values.In other ways, it's not worth thinking about at all: over 30 years a 1% real GDP growth rate will result in an economy 35% larger, 2% real GDP growth will give an economy 81% larger, and 3% real GDP growth will leave us with an economy 143% larger.The difference between the numbers is large, which is why growth rates matter, but none of the growth figures returns a real economy smaller than the one we have now, and indeed, there's no reason to believe the real economy will be smaller in 30 years than it is today.It will, in fact, be much larger.
In 30 years the economy of the United States will look radically different
I do not know what the economy will look like in 30 years, and anyone telling you they know what the economy will look like in 30 years is lying to you. The only thing you need to know about the economy of the United States in 30 years is that the number of workers per dollar of GDP will be much lower than it is today.That's a mechanical product of two functions: a much higher real GDP (see above) and a much lower number of workers as a share of the total population.It's almost irresistible, when you have two facts like these you know to be incontrovertibly true, to reach fantastic conclusions about driverless busses, libraries without librarians, grocery stores without cashiers, banks without tellers, factories without workers, and so on.But there's nothing inevitable about that. We could decide to pay bus drivers enough that we still have busses driven by humans in 30 years. We could pay grocery store cashiers and bank tellers so much that we still have humans performing those jobs in 30 years. We could keep factories open staffed with unionized workers. The only thing you need to know is that higher GDP and fewer workers will make every decision to use human power expensive and deliberate.
You will experience that economy and your role within it as a kind of immiseration
The good news is that you, personally, will be much wealthier in 30 years than you are today. You'll either be in your peak earning years, or collecting your wage-inflation-adjusted Social Security benefit and drawing down the vast fortune you've accumulated across IRA's, 401(k)'s, 403(b)'s, 529's, health savings accounts, and of course taxable accounts.The bad news is that you will be paying more for everything, and you'll experience those increased payments as a burden despite your increased wealth.Here are a few of an unlimited number of examples:
- If we maintain a service-oriented economy, wages will be much higher, and the cost of services will rise. Full service restaurants will become much more expensive. Gratuities will become mandatory "service charges," and you'll complain about how tipping used to be voluntary.
- Alternatively, if we end up automating as much of the economy as possible in order to keep down prices, you'll find annoying how hard it is to find someone to complain to when an item scans incorrectly at the grocery store.
- In the health care sector, if you're below the Medicare enrollment age you'll be paying more in insurance premiums (whether or not the ACA is repealed, plans are allowed to "age rate" premiums for older folks) and insurance premiums as a whole will be much higher simply through the operation of medical price inflation.
- Your state and local taxes will be higher in 30 years than they are today. You'll likely own your own home by then if you don't already, so you'll be paying property taxes directly instead of having them folded into your rent. Meanwhile, property values in the kind of well-functioning communities you'll be able to afford to live in will be much higher in 30 years. That means you'll be paying property taxes on a higher assessed amount.
The key point is that it doesn't matter exactly which economy we end up with in 30 years. You, personally, will experience that changed economy as an affront, because you'll be 30 years older, and you'll remember how things are now, and how they were when you were growing up, and you'll compare them to the (as-yet unknowable) conditions of 30 years from now.You, personally, at age 60, or 65, or 70, will have to deal with new and confusing technology that is not going to make you feel good. I think a lot of 30-year-olds understand the difficulty their parents have with today's technology, but don't have a glimmer of understanding of the trouble they're going to have with the technology of 2047.
Inoculate yourself against grievance
I wouldn't ask you to read all the way through this without offering some solutions. While there's nothing you can do to prevent yourself from feeling poorer in 30 years than you do today (despite your vastly higher wealth), there are some things you can do to avoid channeling that feeling into a politics of grievance and nostalgia.First, be conscious of the coming changes as they happen. At a McDonalds location near my apartment, they've installed an electronic ordering kiosk. You don't have to use it; you can still order at the counter. That's such a minor change it almost disappears into the background. But in 30 years, it's going to be all electronic ordering kiosks everywhere. Think about that, and how it'll make you feel, and you might not find it so jarring when that day comes.Second, support universal programs. In one of the only actual policy disagreements between Hillary Clinton and Bernie Sanders, Sanders argued that public universities should be tuition-free for everyone, while Clinton argued that they should only be tuition-free for the poor, middle class, and moderately wealthy, but not for the extremely wealthy (it was a weird campaign). Sanders was right: in my experience the wealthy treat the idea that the poor receive special treatment as a key source of grievance. The answer isn't to make life even harder for the poor: it's to eliminate the web of means-testing and income-verification designed to identify and exclude the wealthy from receiving benefits. If you have access to the same benefits as the poor in 30 years, you might not be tempted to accuse them of "gaming" the system.Third, engage your neighbors and community offline, outside of work. My impression is that people with kids have an easier time doing this because they have school events, extracurricular activities, and so on, but anyone can join a local sports league (bowling is easy, fencing is hard) or fraternal organization. This is good for your mental health in general, but it's particularly important as you get older to have a source of community that's not dependent on your workplace, or profession, or even your location. The more multigenerational, the better, since as you age you'll want to get gradually acclimated to the changes that are coming, rather than discover them all at once when Fox News runs a special report on kids these days.Finally, fight for an economy that works for everyone. Pick a subject you know a lot about, or nothing about, and get educated about it and educate others. I'm obsessed with entrepreneurs and entrepreneurship. Find a topic that excites you: zoning rules, public transportation, school funding, whatever. Show up at neighborhood or city council meetings. Vote! Staying engaged is the best way to fend off the sense of helplessness that might make you want to respond to fundraising mailers in old age.
Conclusion
As a millennial I'm obviously not thrilled with the way Baby Boomers have channeled their feelings of grievance and resentment into the politics we endure today. But the millennial generation is also the biggest generation since the Baby Boom, and it would pain me even more if, in 30 years, when we form the largest, most politically active demographic, we have turned our own grievances into a narrow, bitter politics directed against the young and the poor in a vain attempt to preserve our own sense of wealth and privilege.Let's do better this time.
