8 ms·

The War on the Young

48 points by limist 17y ago

kiba 17y ago
Even with those massive disincentive against me, I still dream of changing the world through my games and getting rich in the process.
asnyder 17y ago
While interesting, some aspects of the article are misleading or meant to incite. For example, the section talking about student aid mentions the current administration's plan to increase student aid, but fails to mention the proposal of doing away with the bank subsidies completely and thus providing more aid instead of lining the pockets of bankers (http://www.whitehouse.gov/the_press_office/President-Obama-Meets-with-Family-Struggling-with-College-Costs/ http://www.whitehouse.gov/the_press_office/President-Obama-M...) contradicting the counter point to his argument.
- davidw 17y ago
  > meant to incite. Which is mostly what you'd expect from a site like mises.org or anything else that is highly political in nature.
- kiba 17y ago
  Won't this increase the demand for college education, thus allowing colleges to raise their price even higher?
  - asnyder 17y ago
    I don't know. Perhaps. However, with the current economic conditions I would think that many that attend school under normal conditions might not be able to attend without aid. I'm sure we can look at the numbers and come up with a conclusion. Furthermore, there are many city and state institutions that have tuition caps. In this situation I would expect more students to result in better use of existing resources or the creation of more city and state institutions.
    - BearOfNH 17y ago
      I'm sure we can look at the numbers and come up with a conclusion. A long, long time ago I read an article comparing the increase in the cost of college education vs. the published inflation rate. They were roughly the same. Really. But this was a long, long time ago...Camelot. After student loans came into existence this rough equality disappeared and the cost of an education rose faster than inflation. Economically, that makes sense. Subsidize something (education) and you get more demand. With a somewhat inelastic supply of colleges, the price goes up. Of course correlation is not causation. Many other reasons can be cited as well. But once upon a time college, while still expensive, only kept pace with inflation.
  - sgoraya 17y ago
    Certainly possible - This is why I have opened a college savings, 529 plan for my 4 week old son (you can never start saving too early).
    - ivankirigin 17y ago
      You can definitely start saving too early, in the sense that over a 16 year period you might be better off with a portfolio more aggressive than a savings account.
      - sgoraya 17y ago
        FYI: 529's can be structured as a portfolio/mutual fund and be as aggressive as you want it... https://personal.vanguard.com/us/funds/529portfolios https://personal.vanguard.com/us/funds/529portfolios
- joe_the_user 17y ago
  The subsidies to banks are incentives to loan. Fewer incentives seems likely to result in a fewer loans at higher prices. If the price of education was set entirely by the market, the price of education would be equal to the expected reward - which would imply student payments so high they leave a graduate making little over the minimum wage for their entire lifetime. Even more, the student is more likely to overestimate their expected reward from education (everyone thinks their above average) than the bank is likely to underestimate it so some students today can wind-up with truly absurd debt loads (think of the people who drop out of medical school with no degree but owing $150K). This situation provide such perverse incentives that it's in the interest of society to prevent it through lower-priced state education as well as private education subsidized by scholarships. During the 1950's, when America happen to be growing and productive, this was the paradigm. In the present era, the movement towards the marketization of education has only accelerated the country's decline. Why providing even more marketization now is "good thing" is beyond me. Education and basic health care should be provided free to each citizen (to extent, forced on each individual) because they are a good, benefit for society as a whole rather than being merely a good for each individual. You benefit when everyone is healthy and smart (unless you're a con-man looking to outsmart your fellow citizen). The willingness of this society to go in the opposite direction has been a powerful force moving downwards.
hristov 17y ago
Another one of those conservative anti-deficit articles that would have been very timely if it appeared before the war started, but of course it appears after the war and the incredible amount of money it is costing us. Why did I never hear conservatives decrying deficit spending during the Bush years, when deficit spending ballooned. No, then you had conservatives talking about how the deficit does not really matter. Now it is too late, the cat is out of the bag. We need deficit spending just to keep the damn economy from collapsing, and no politician will have the guts to just exit the wars.
- kiba 17y ago
  The blog article is from a Libertarian, not a conservative institution.
- sp332 17y ago
  No, then you had conservatives talking about how the deficit does not really matter. Are you sure they were conservatives, and not just Republicans?
- limist 17y ago
  Except that the Mises Institute and (I believe) most Austrian economists are anti-war: http://en.wikipedia.org/wiki/Ludwig_von_Mises_Institute#Mission_and_activities http://en.wikipedia.org/wiki/Ludwig_von_Mises_Institute#Miss... The Institute characterizes itself as libertarian and expresses antiwar and non-interventionist positions on American foreign policy, asserting that war is a violation of rights to life, liberty, and property, with destructive effects on the market economy, and tends to increase the power of government.
- TomOfTTB 17y ago
  I don't see this as Conservative as much as it's Libertarian (See the anti-War on Drugs part for example). From that stand point Libertarians have always been vehemently against not only the war in Iraq (http://www.thegreenpapers.com/Vox/?20030310-0 http://www.thegreenpapers.com/Vox/?20030310-0) but in many cases the one in Afghanistan as well (http://libertarians4peace.net/ http://libertarians4peace.net/). Libertarians in general are non-interventionist in regards to foreign policy. So I think your criticism is misplaced here
pmichaud 17y ago
I think the minimum wage argument was weak, but he's basically right: young people have a whole bunch of problems to look forward to.
- bwh2 17y ago
  Agreed. I read "Laws dictating the minimum wage and regulating child labor play a significant role in preventing young people from finding jobs" and rolled my eyes a little.
  - hga 17y ago
    OK, so tell me why we don't have movie ushers anymore. Price controls always produce shortages; in this case, there's a whole bunch of jobs companies just can't afford to hire people to do any more because the total cost of labor is higher than the return. Is this so hard to understand? Is it a moral position to tell an unemployed youth that if they can't get a job at $X wage there's better off without one? Have you looked a youth unemployment rates, especially recently?
    - bwh2 17y ago
      Well, first of all, you're using the phrase "youth employment," which I think is reasonable and fairly normal. The author used the phrase "child labor," which I rolled my eyes at because the author is seemingly oblivious to the negative connotation of that phrase. Second, I'm not even necessarily in favor of a minimum wage. I just think it's bogus to blame our current economic woes on the existence of minimum wage. It's a bogeyman that the right attacks at every opportunity, whether it makes sense or not. Edit: Also, you haven't provided any evidence supporting the claim that we don't have movie ushers because of minimum wage or labor laws. You've just provided ideological conjecture and arbitrarily placed the burden of proof on me.
      - Semiapies 17y ago
        It's legally "child labor" until you're 18.
jsm386 17y ago
Young people today will most likely become the first generation in US history not to surpass their parents' living standards. I've seen this phrase, in various versions, in lots of places over the past few months. Is this a new proposition, or was the idea floated (incorrectly) during the Great Depression or the 1970s oil crisis/stagflation downturn?
- kiba 17y ago
  Maybe the economy will manages to weaseled their way out despite the huge obstacles that has been placed in front of it. It look like the government is doing everything it can to make the obstacle even higher and thicker though.
- DanielBMarkham 17y ago
  This is a new idea. The current generation is the first generation that everybody thinks will not do as well as the preceding one. During all of the economic problems of the past, polls consistently shown that people, as bad as things were, expected their kids to have a better financial life than their own. This is no longer true.
  - shawndrost 17y ago
    Citation?
    - DanielBMarkham 17y ago
      Can't easily find the historical evidence, but here's the current data: http://pewresearch.org/pubs/311/once-again-the-future-aint-what-it-used-to-be http://pewresearch.org/pubs/311/once-again-the-future-aint-w... Note that the data is different depending on whether you ask "will children do as well as their parents?" or "will your children do as well as their parents?"
Alex3917 17y ago
"Young people today will most likely become the first generation in US history not to surpass their parents' living standards." I sat in on a talk that Frank Luntz was giving last night. Everyone else in the audience was 40+, well educated, all at the top of their fields. When Frank asked them how many thought their kids would have a better standard of living than they did, only 6 of the 120ish people in the room raised their hands. Frank's comment was, "If you're all in the top 1%, imagine how the rest of America feels right now."
- marciovm123 17y ago
  This is correct if you consider "better standard of living" to mean "better standard of living relative to rest of the world". In terms of actual consumption and productivity, young people in America will have far richer lives then their parents, because the exponential increase in technology we see every day is creating wealth at a ridiculous pace. Our parents did not have iPods, cell phones, e-mail or social networks (facebook, hacker news). Try living without any of these for a day to see how "rich" your parents were at your age; who knows what will be around 20 years from now? We take these things for granted and don't consider them "making us richer" because they are widely accessible, and people have a tendency to consider themselves rich only when they are richer then their neighbors.
  - markbnine 17y ago
    Ugh. Equating technology with wealth is extremely naive. Standard of living refers to cost of food, housing, health care, etc.
    - marciovm123 17y ago
      Your point might be correct for the majority of the world's population but certainly not for the US...You don't think technology equals wealth, really? I'm surprised to find people who think that at HN. Think about how much would you pay for a sony walkman today vs. 20 yrs ago. In that same vein, how can you calculate the cost of healthcare for technologies that did not exist 20 years ago? How do you compare the cost of a McMansion to the kinds of houses (tiny) that were being built 20 years ago? You can't. So instead people look at numbers they can calculate, and draw limited conclusions. It's a sort of selection bias based on what kinds of data we know how to work with.
maurycy 17y ago
Good article. I'd add one more bit, though: it's not between youth and old; it's between risk takers and risk avoiders. The last thing the majority dreams about is risk. So the gov takes care and tries to minimize the risk. The minimum wage, enormous benefits for not very innovative public workers, interest rates' manipulation etc. Of course, if you minimize the risk you also minimize the social mobility. It's hard to get a reward, without risk.
- joe_the_user 17y ago
  Oddly enough, the post-WWII generation did much better than the present generation without being notable for risk taking. I mean, declining education levels, deteriorating infrastructure, and many other causes might be pointed to for the decline of America. Considering that, as you say, only a minority is ever going to risk-inclined, the decline of America can't be chalked up to risk-aversion. And also, when the health care system declines, the risk of catastrophic becomes something that an individual isn't very capable of managing.
  - hga 17y ago
    That's not a very telling point, since we were the industrial nation least trashed by WWI, and were considerably strengthened by how the war compressed say half a century's worth of technological progress into a half a decade. For example so very many things came out of RADAR R&D ... *including microwave ovens :-), but also stuff that fed into the Whirlwind computer project (the first practical computer), etc. etc.
DenisM 17y ago
Look at the big picture: the aging of the population means that the eldery must enslave the young, or they will have nothing to eat when they are old and infirm. Long-term savings is a fictitious concept - nothing we produce today will be of any use 40 years later so when you are old you will depend on the young to provide your food. When that happens you better have a way to compel them to part with fruits of their labor. Saddling the young with debt seems to be the current retirement plan for the old. It ain't just about bankers.
- joe_the_user 17y ago
  Well, San Francisco had to contract out to Korea to fix the Bay Bridge, so it's quite possible that nothing we make in America will be worth anything in forty years. But there's quite a bit of useful forty year stuff.
  - DenisM 17y ago
    What are the kind of things that will retain their value after 40 years that you or I could stash away for retirement?
    - brc 17y ago
      A toll bridge, for starters, or at least a piece of one. A valuable piece of land with a durable building on it (eg capital city) A piece of a growing and profitable company (eg Google) Royalties or income streams from work you create (see Elvis, Paul Mcartney, etc) A piece of valuable farmland A piece of valuable mine A piece of a company you create and grow (see succesful startup) A hunk of precious metal (eg gold, silver - they've been valuable for, say, 5,000 years or so) Not: cash speculative stocks bubble inflated real estate suitable for a shrinking demographic managed investments consumer junk
- donaldc 17y ago
  nothing we produce today will be of any use 40 years later I'm living in a building that was built in the 1920's. It is definitely still useful. True, consumer goods generally don't last that long, but capital goods can last for a half-century or more.
sganesh 17y ago
This guy doesn’t know what he is talking about. Mises institute has a bunch of crackpots that are not respected by actual economists: http://motherjones.com/kevin-drum/2010/02/market-economics http://motherjones.com/kevin-drum/2010/02/market-economics
- kiba 17y ago
  Do you have a better argument than an appeal to authority?
- jwb119 17y ago
  i'm not sure mother jones qualifies as a neutral source either (despite the quotes from krugman and friedman about biz cycle theory)
  - nir 17y ago
    But it is saying something if both Friedman and Krugman agree on this.
    - Semiapies 17y ago
      It says they both disagree with the Austrian school's version of business cycle theory. Even the quoted writer goes nowhere near the dismissal of the Austrian school attempted in the MoJo piece. I'm reminded of when you see someone cite a creationist and one evolutionary biologist's disagreement with another on some detail of evolutionary mechanisms in order to argue for Intelligent Design.
- limist 17y ago
  Don't you find it telling that critics of Mises and Austrian economics rely on ad hominem (personal attacks), appeal to the majority, and appeal to authority as their main argument forms - all of which are fallacious? Considering that the track record of mainstream economist predictions about the economy are horrid (just try trading their predictions), we should consider plausible, alternative points of view.
run4yourlives 17y ago
>Young people today will most likely become the first generation in US history not to surpass their parents' living standards." I'm pretty sure that was Generation X. Myself at 35 being on the tail end of that group; we're hardly "the young".
- papaf 17y ago
  Myself at 39, educated above but living below my parents standards. I'm not complaining since I'm very happy, but it is interesting that my generation is already experiencing this drop. House prices and a competitive job market are the main forces keeping my standard of living lower.
mark_l_watson 17y ago
Good article, as usual for mises.org (I credit their material a few years ago for motivating me to get out of the stock market). I am in my 50s, and one of my common little rants is how selfish my generation and the next older generation is. My children and my young grandchildren will indeed have to pay for our collective excesses. Really unfair. I believe that it is human nature to care for younger generations, so the current wave of selfishness is really sick and unnatural behavior. Two generations of gluttons. This selfishness is on personal, corporate, and government levels. The worst is starting unnecessary wars on credit, but the general blame trickles on down.
- kingkongreveng_ 17y ago
  You generation is screwed, too. Social security net revenue went negative this year. You'll never see a dime. Medicare will also be bankrupt much sooner than anyone thinks. Only the "next older generation" has made out on these ponzi schemes.
  - mark_l_watson 17y ago
    You are right about the next older generation getting even a better deal, but I am not complaining on my own account: when I graduated from college in the 1970s, it was really easy to buy a home, and generally have had an easy life style. I have to admit to a bit of a morbid fascination about the economy: I expect that in the USA that local governments will go bankrupt, the federal government will devalue the dollar to get by, etc. Thing that I have no idea about: will this happen in 1 year, 10 years? ...
jsz0 17y ago
I just don't get libertarians. They're great at pointing out problems but never seem to offer realistic solutions. No doubt most of these issues he raises are valid concerns however what's the alternative? The free market will magically fix everything? We know from the Great Depression and in more recent times the free market is only concerned about maximizing profits for themselves. The government may not be supremely efficient at running some of these things but at least we have a say in the process. Most of the issues he cites exist because the free market failed people in the past and there was public outrage over a government that allowed it to happen.
- Semiapies 17y ago
  I just don't get safety freaks. They're great at pointing out dangers, but never seem to offer realistic solutions. No doubt many of the activities they criticize are harmful, but what's the alternative? Not hitting ourselves with hammers and not walking barefoot on rusty metal and hoping that our bodies will somehow magically avoid trauma and tetanus? Seriously - in the real world, a perfectly valid way to solve a problem is to stop doing the thing that causes it. Why the defensiveness because a libertarian pointed this out?
  - bwh2 17y ago
    The author complains about Medicare, Social Security, student loans, and the War on Drugs. Whether or not you agree with those programs, do you think it's practical to just stop them? While I agree with many libertarian sentiments, I rarely find a libertarian argument that even attempts to explain a transition process.
    - Semiapies 17y ago
      A better question might be "Do you really think it's practical to continue them?", but to answer you: yes. As for transition processes, to be blunt, many random libertarians online don't bother discussing them because they know it will probably never come to that. If you want good discussion of such things, places like the Mises Institute and Cato.org (full of policy wonks) would be good starting points.
xenonite 17y ago
thanks for the article, but it has right the opposite direction than what is complained about here in Germany. we complain about the newly introduced Bachelor/Masters system here. We complain, students will now have less time to study and think about the problems. Also having to pay more money than before, we say that less people will go to universities, thus lowering education standards.
xenonite 17y ago
the article says that accepting a low wage will make you independent. I wouldn't conclude like that. Working with low wages will seldomly enable to get a better standard. If you aren't a top performer, you'd have to live forever with those wages. One job is be enough for a living.
emilind 17y ago
You guys know the mises.org folks are a bunch of racists, right?
efalcao 17y ago
I think I'm going to start redirecting a portion of my savings to some sort of a basket of foreign currencies. If in 10 or 20 years, we don't clean up our act and a huge part of my taxes are just servicing debt, I'll just move somewhere else. I don't even care if the taxes are higher in another country; so long as I get good value for my taxes paid.

48 points by limist 17y ago

kiba 17y ago

Even with those massive disincentive against me, I still dream of changing the world through my games and getting rich in the process.

asnyder 17y ago

While interesting, some aspects of the article are misleading or meant to incite. For example, the section talking about student aid mentions the current administration's plan to increase student aid, but fails to mention the proposal of doing away with the bank subsidies completely and thus providing more aid instead of lining the pockets of bankers (http://www.whitehouse.gov/the_press_office/President-Obama-Meets-with-Family-Struggling-with-College-Costs/ http://www.whitehouse.gov/the_press_office/President-Obama-M...) contradicting the counter point to his argument.

davidw 17y ago
> meant to incite. Which is mostly what you'd expect from a site like mises.org or anything else that is highly political in nature.
kiba 17y ago
Won't this increase the demand for college education, thus allowing colleges to raise their price even higher?
- asnyder 17y ago
  I don't know. Perhaps. However, with the current economic conditions I would think that many that attend school under normal conditions might not be able to attend without aid. I'm sure we can look at the numbers and come up with a conclusion. Furthermore, there are many city and state institutions that have tuition caps. In this situation I would expect more students to result in better use of existing resources or the creation of more city and state institutions.
  - BearOfNH 17y ago
    I'm sure we can look at the numbers and come up with a conclusion. A long, long time ago I read an article comparing the increase in the cost of college education vs. the published inflation rate. They were roughly the same. Really. But this was a long, long time ago...Camelot. After student loans came into existence this rough equality disappeared and the cost of an education rose faster than inflation. Economically, that makes sense. Subsidize something (education) and you get more demand. With a somewhat inelastic supply of colleges, the price goes up. Of course correlation is not causation. Many other reasons can be cited as well. But once upon a time college, while still expensive, only kept pace with inflation.
- sgoraya 17y ago
  Certainly possible - This is why I have opened a college savings, 529 plan for my 4 week old son (you can never start saving too early).
  - ivankirigin 17y ago
    You can definitely start saving too early, in the sense that over a 16 year period you might be better off with a portfolio more aggressive than a savings account.
    - sgoraya 17y ago
      FYI: 529's can be structured as a portfolio/mutual fund and be as aggressive as you want it... https://personal.vanguard.com/us/funds/529portfolios https://personal.vanguard.com/us/funds/529portfolios
joe_the_user 17y ago
The subsidies to banks are incentives to loan. Fewer incentives seems likely to result in a fewer loans at higher prices. If the price of education was set entirely by the market, the price of education would be equal to the expected reward - which would imply student payments so high they leave a graduate making little over the minimum wage for their entire lifetime. Even more, the student is more likely to overestimate their expected reward from education (everyone thinks their above average) than the bank is likely to underestimate it so some students today can wind-up with truly absurd debt loads (think of the people who drop out of medical school with no degree but owing $150K). This situation provide such perverse incentives that it's in the interest of society to prevent it through lower-priced state education as well as private education subsidized by scholarships. During the 1950's, when America happen to be growing and productive, this was the paradigm. In the present era, the movement towards the marketization of education has only accelerated the country's decline. Why providing even more marketization now is "good thing" is beyond me. Education and basic health care should be provided free to each citizen (to extent, forced on each individual) because they are a good, benefit for society as a whole rather than being merely a good for each individual. You benefit when everyone is healthy and smart (unless you're a con-man looking to outsmart your fellow citizen). The willingness of this society to go in the opposite direction has been a powerful force moving downwards.

hristov 17y ago

Another one of those conservative anti-deficit articles that would have been very timely if it appeared before the war started, but of course it appears after the war and the incredible amount of money it is costing us. Why did I never hear conservatives decrying deficit spending during the Bush years, when deficit spending ballooned. No, then you had conservatives talking about how the deficit does not really matter. Now it is too late, the cat is out of the bag. We need deficit spending just to keep the damn economy from collapsing, and no politician will have the guts to just exit the wars.

kiba 17y ago
The blog article is from a Libertarian, not a conservative institution.
sp332 17y ago
No, then you had conservatives talking about how the deficit does not really matter. Are you sure they were conservatives, and not just Republicans?
limist 17y ago
Except that the Mises Institute and (I believe) most Austrian economists are anti-war: http://en.wikipedia.org/wiki/Ludwig_von_Mises_Institute#Mission_and_activities http://en.wikipedia.org/wiki/Ludwig_von_Mises_Institute#Miss... The Institute characterizes itself as libertarian and expresses antiwar and non-interventionist positions on American foreign policy, asserting that war is a violation of rights to life, liberty, and property, with destructive effects on the market economy, and tends to increase the power of government.
TomOfTTB 17y ago
I don't see this as Conservative as much as it's Libertarian (See the anti-War on Drugs part for example). From that stand point Libertarians have always been vehemently against not only the war in Iraq (http://www.thegreenpapers.com/Vox/?20030310-0 http://www.thegreenpapers.com/Vox/?20030310-0) but in many cases the one in Afghanistan as well (http://libertarians4peace.net/ http://libertarians4peace.net/). Libertarians in general are non-interventionist in regards to foreign policy. So I think your criticism is misplaced here

pmichaud 17y ago

I think the minimum wage argument was weak, but he's basically right: young people have a whole bunch of problems to look forward to.

bwh2 17y ago
Agreed. I read "Laws dictating the minimum wage and regulating child labor play a significant role in preventing young people from finding jobs" and rolled my eyes a little.
- hga 17y ago
  OK, so tell me why we don't have movie ushers anymore. Price controls always produce shortages; in this case, there's a whole bunch of jobs companies just can't afford to hire people to do any more because the total cost of labor is higher than the return. Is this so hard to understand? Is it a moral position to tell an unemployed youth that if they can't get a job at $X wage there's better off without one? Have you looked a youth unemployment rates, especially recently?
  - bwh2 17y ago
    Well, first of all, you're using the phrase "youth employment," which I think is reasonable and fairly normal. The author used the phrase "child labor," which I rolled my eyes at because the author is seemingly oblivious to the negative connotation of that phrase. Second, I'm not even necessarily in favor of a minimum wage. I just think it's bogus to blame our current economic woes on the existence of minimum wage. It's a bogeyman that the right attacks at every opportunity, whether it makes sense or not. Edit: Also, you haven't provided any evidence supporting the claim that we don't have movie ushers because of minimum wage or labor laws. You've just provided ideological conjecture and arbitrarily placed the burden of proof on me.
    - Semiapies 17y ago
      It's legally "child labor" until you're 18.

jsm386 17y ago

Young people today will most likely become the first generation in US history not to surpass their parents' living standards. I've seen this phrase, in various versions, in lots of places over the past few months. Is this a new proposition, or was the idea floated (incorrectly) during the Great Depression or the 1970s oil crisis/stagflation downturn?

kiba 17y ago
Maybe the economy will manages to weaseled their way out despite the huge obstacles that has been placed in front of it. It look like the government is doing everything it can to make the obstacle even higher and thicker though.
DanielBMarkham 17y ago
This is a new idea. The current generation is the first generation that everybody thinks will not do as well as the preceding one. During all of the economic problems of the past, polls consistently shown that people, as bad as things were, expected their kids to have a better financial life than their own. This is no longer true.
- shawndrost 17y ago
  Citation?
  - DanielBMarkham 17y ago
    Can't easily find the historical evidence, but here's the current data: http://pewresearch.org/pubs/311/once-again-the-future-aint-what-it-used-to-be http://pewresearch.org/pubs/311/once-again-the-future-aint-w... Note that the data is different depending on whether you ask "will children do as well as their parents?" or "will your children do as well as their parents?"

Alex3917 17y ago

"Young people today will most likely become the first generation in US history not to surpass their parents' living standards." I sat in on a talk that Frank Luntz was giving last night. Everyone else in the audience was 40+, well educated, all at the top of their fields. When Frank asked them how many thought their kids would have a better standard of living than they did, only 6 of the 120ish people in the room raised their hands. Frank's comment was, "If you're all in the top 1%, imagine how the rest of America feels right now."

marciovm123 17y ago
This is correct if you consider "better standard of living" to mean "better standard of living relative to rest of the world". In terms of actual consumption and productivity, young people in America will have far richer lives then their parents, because the exponential increase in technology we see every day is creating wealth at a ridiculous pace. Our parents did not have iPods, cell phones, e-mail or social networks (facebook, hacker news). Try living without any of these for a day to see how "rich" your parents were at your age; who knows what will be around 20 years from now? We take these things for granted and don't consider them "making us richer" because they are widely accessible, and people have a tendency to consider themselves rich only when they are richer then their neighbors.
- markbnine 17y ago
  Ugh. Equating technology with wealth is extremely naive. Standard of living refers to cost of food, housing, health care, etc.
  - marciovm123 17y ago
    Your point might be correct for the majority of the world's population but certainly not for the US...You don't think technology equals wealth, really? I'm surprised to find people who think that at HN. Think about how much would you pay for a sony walkman today vs. 20 yrs ago. In that same vein, how can you calculate the cost of healthcare for technologies that did not exist 20 years ago? How do you compare the cost of a McMansion to the kinds of houses (tiny) that were being built 20 years ago? You can't. So instead people look at numbers they can calculate, and draw limited conclusions. It's a sort of selection bias based on what kinds of data we know how to work with.

maurycy 17y ago

Good article. I'd add one more bit, though: it's not between youth and old; it's between risk takers and risk avoiders. The last thing the majority dreams about is risk. So the gov takes care and tries to minimize the risk. The minimum wage, enormous benefits for not very innovative public workers, interest rates' manipulation etc. Of course, if you minimize the risk you also minimize the social mobility. It's hard to get a reward, without risk.

joe_the_user 17y ago
Oddly enough, the post-WWII generation did much better than the present generation without being notable for risk taking. I mean, declining education levels, deteriorating infrastructure, and many other causes might be pointed to for the decline of America. Considering that, as you say, only a minority is ever going to risk-inclined, the decline of America can't be chalked up to risk-aversion. And also, when the health care system declines, the risk of catastrophic becomes something that an individual isn't very capable of managing.
- hga 17y ago
  That's not a very telling point, since we were the industrial nation least trashed by WWI, and were considerably strengthened by how the war compressed say half a century's worth of technological progress into a half a decade. For example so very many things came out of RADAR R&D ... *including microwave ovens :-), but also stuff that fed into the Whirlwind computer project (the first practical computer), etc. etc.

DenisM 17y ago

Look at the big picture: the aging of the population means that the eldery must enslave the young, or they will have nothing to eat when they are old and infirm. Long-term savings is a fictitious concept - nothing we produce today will be of any use 40 years later so when you are old you will depend on the young to provide your food. When that happens you better have a way to compel them to part with fruits of their labor. Saddling the young with debt seems to be the current retirement plan for the old. It ain't just about bankers.

joe_the_user 17y ago
Well, San Francisco had to contract out to Korea to fix the Bay Bridge, so it's quite possible that nothing we make in America will be worth anything in forty years. But there's quite a bit of useful forty year stuff.
- DenisM 17y ago
  What are the kind of things that will retain their value after 40 years that you or I could stash away for retirement?
  - brc 17y ago
    A toll bridge, for starters, or at least a piece of one. A valuable piece of land with a durable building on it (eg capital city) A piece of a growing and profitable company (eg Google) Royalties or income streams from work you create (see Elvis, Paul Mcartney, etc) A piece of valuable farmland A piece of valuable mine A piece of a company you create and grow (see succesful startup) A hunk of precious metal (eg gold, silver - they've been valuable for, say, 5,000 years or so) Not: cash speculative stocks bubble inflated real estate suitable for a shrinking demographic managed investments consumer junk
donaldc 17y ago
nothing we produce today will be of any use 40 years later I'm living in a building that was built in the 1920's. It is definitely still useful. True, consumer goods generally don't last that long, but capital goods can last for a half-century or more.

sganesh 17y ago

This guy doesn’t know what he is talking about. Mises institute has a bunch of crackpots that are not respected by actual economists: http://motherjones.com/kevin-drum/2010/02/market-economics http://motherjones.com/kevin-drum/2010/02/market-economics

kiba 17y ago
Do you have a better argument than an appeal to authority?
jwb119 17y ago
i'm not sure mother jones qualifies as a neutral source either (despite the quotes from krugman and friedman about biz cycle theory)
- nir 17y ago
  But it is saying something if both Friedman and Krugman agree on this.
  - Semiapies 17y ago
    It says they both disagree with the Austrian school's version of business cycle theory. Even the quoted writer goes nowhere near the dismissal of the Austrian school attempted in the MoJo piece. I'm reminded of when you see someone cite a creationist and one evolutionary biologist's disagreement with another on some detail of evolutionary mechanisms in order to argue for Intelligent Design.
limist 17y ago
Don't you find it telling that critics of Mises and Austrian economics rely on ad hominem (personal attacks), appeal to the majority, and appeal to authority as their main argument forms - all of which are fallacious? Considering that the track record of mainstream economist predictions about the economy are horrid (just try trading their predictions), we should consider plausible, alternative points of view.

run4yourlives 17y ago

>Young people today will most likely become the first generation in US history not to surpass their parents' living standards." I'm pretty sure that was Generation X. Myself at 35 being on the tail end of that group; we're hardly "the young".

papaf 17y ago
Myself at 39, educated above but living below my parents standards. I'm not complaining since I'm very happy, but it is interesting that my generation is already experiencing this drop. House prices and a competitive job market are the main forces keeping my standard of living lower.

mark_l_watson 17y ago

Good article, as usual for mises.org (I credit their material a few years ago for motivating me to get out of the stock market). I am in my 50s, and one of my common little rants is how selfish my generation and the next older generation is. My children and my young grandchildren will indeed have to pay for our collective excesses. Really unfair. I believe that it is human nature to care for younger generations, so the current wave of selfishness is really sick and unnatural behavior. Two generations of gluttons. This selfishness is on personal, corporate, and government levels. The worst is starting unnecessary wars on credit, but the general blame trickles on down.

kingkongreveng_ 17y ago
You generation is screwed, too. Social security net revenue went negative this year. You'll never see a dime. Medicare will also be bankrupt much sooner than anyone thinks. Only the "next older generation" has made out on these ponzi schemes.
- mark_l_watson 17y ago
  You are right about the next older generation getting even a better deal, but I am not complaining on my own account: when I graduated from college in the 1970s, it was really easy to buy a home, and generally have had an easy life style. I have to admit to a bit of a morbid fascination about the economy: I expect that in the USA that local governments will go bankrupt, the federal government will devalue the dollar to get by, etc. Thing that I have no idea about: will this happen in 1 year, 10 years? ...

jsz0 17y ago

I just don't get libertarians. They're great at pointing out problems but never seem to offer realistic solutions. No doubt most of these issues he raises are valid concerns however what's the alternative? The free market will magically fix everything? We know from the Great Depression and in more recent times the free market is only concerned about maximizing profits for themselves. The government may not be supremely efficient at running some of these things but at least we have a say in the process. Most of the issues he cites exist because the free market failed people in the past and there was public outrage over a government that allowed it to happen.

Semiapies 17y ago
I just don't get safety freaks. They're great at pointing out dangers, but never seem to offer realistic solutions. No doubt many of the activities they criticize are harmful, but what's the alternative? Not hitting ourselves with hammers and not walking barefoot on rusty metal and hoping that our bodies will somehow magically avoid trauma and tetanus? Seriously - in the real world, a perfectly valid way to solve a problem is to stop doing the thing that causes it. Why the defensiveness because a libertarian pointed this out?
- bwh2 17y ago
  The author complains about Medicare, Social Security, student loans, and the War on Drugs. Whether or not you agree with those programs, do you think it's practical to just stop them? While I agree with many libertarian sentiments, I rarely find a libertarian argument that even attempts to explain a transition process.
  - Semiapies 17y ago
    A better question might be "Do you really think it's practical to continue them?", but to answer you: yes. As for transition processes, to be blunt, many random libertarians online don't bother discussing them because they know it will probably never come to that. If you want good discussion of such things, places like the Mises Institute and Cato.org (full of policy wonks) would be good starting points.

xenonite 17y ago

thanks for the article, but it has right the opposite direction than what is complained about here in Germany. we complain about the newly introduced Bachelor/Masters system here. We complain, students will now have less time to study and think about the problems. Also having to pay more money than before, we say that less people will go to universities, thus lowering education standards.

xenonite 17y ago

the article says that accepting a low wage will make you independent. I wouldn't conclude like that. Working with low wages will seldomly enable to get a better standard. If you aren't a top performer, you'd have to live forever with those wages. One job is be enough for a living.

emilind 17y ago

You guys know the mises.org folks are a bunch of racists, right?

efalcao 17y ago

I think I'm going to start redirecting a portion of my savings to some sort of a basket of foreign currencies. If in 10 or 20 years, we don't clean up our act and a huge part of my taxes are just servicing debt, I'll just move somewhere else. I don't even care if the taxes are higher in another country; so long as I get good value for my taxes paid.