I've spent a lot of time thinking about this particular topic as well so I hesitate to respond without structuring a response; I suppose I could take a "devil's advocate" approach and attempt to offer hope by way of rejoinder but I think I'd fail to demonstrate an appropriately personal tone with such a choice; I'm therefore going to try to respond "Tim-style", i.e. personally and with some links to articles from well-respected publications which broach the subject in an even-handed fashion.
http://www.economist.com/world/unitedstates/displaystory.cfm?story_id=11792366&fsrc=RSS
http://www.economist.com/opinion/displaystory.cfm?story_id=11791539&fsrc=RSS
(If nothing else check out the second link - there's a pretty cool drawing)
I can't speak to anyone else's expectations but I know I had high hopes when I was in high school: I had amassed an academic record which I thought to be "par excellence", I was beginning to come of age, and the future (from a economic/cultural/political standpoint) was bright. My assumption was that I would excel in college just as I had in high school and ultimately find my way to (what is, objectively, modest) prosperity.
Certainly things turned out differently. I never anticipated that at 27 years of age I'd be living with my parents and dealing with a terminal illness but, low and behold, that is now reality. I failed to get admission to any of the schools I applied to for college. I spent the first year after I graduated unemployed thanks to (a) a telecom industry implosion, (b) a dot-com bubble bursting, and (c) a bad undergraduate experience and spent the last 3 1/2 years working for IBM. Although IBM was a sought-after employer at our college career fairs the company has been a little less than fair: I saw my salary raised an entire 2.4% (which is less than inflation was during the same period), observed the company's practice of paying local new hires (from San Jose State and Santa Clara University) nearly $5K more than I make (even though I have five years of industry experience and an engineering degree from Cal), and watched a colleague get promoted before I did despite working 10 hour days (the rub was the colleague was promoted posthumously). I took a look at my college's salary survey from last year (http://career.berkeley.edu/Major2006/EECS.stm) and my present salary is about 7% below the mean and average for *new* graduates (I would cautiously venture to say that that the mean and median salary for UCB EECS graduates with five years of working experience is ~$90,000). Needless to say that, as a result of my geographically-insensitive salary, I've been living at home, commuting approximately 130 miles a day, and saving every penny with the hope that I can (some day) afford a lifestyle which was more or less implicit when I decided to spend the prime of my life to study math, physics, and CS rather than the female student body. I've racked up more than $5K in medical bills (out-of-pocket cost, and I'm insured through Empire and Kaiser!) each of the last three years and still don't have much to show for it than a stalemate with respect to test results (i.e. tumor marker present but tumor-free imaging tests), to say nothing of the fact that my voice was damaged by surgery and may never be recovered.
From my vantage point the opportunities which are available to me (and, implicitly, to us) are limited: one can continue in a dead-end job, attempt to change employers (which, as I'm finding out, is just as difficult as finding a job in the first place), or return to school for an advanced degree which may ultimately prove to be as useful (towards the ends of employment) as the degree one already has. Changing employers might also mean moving (which is, for the most part, true of attending a graduate school as well) so there's a trade-off there as well (new surroundings & a displacement from the habit of comfort v/s cost of renting & loss of easy access to a healthy lifestyle at home).
I certainly have some of the same anxieties with regards to any one of a number of "securities" (http://www.huffingtonpost.com/gary-hart/are-you-secure_b_160.html) but I suppose I'm more optimistic with respect to the future. Politics (like many other things) is a pendulum which invariably swings to-and-fro from extreme to extreme; if the last seven years have been the height of irresponsibility, recklessness, and hopelessness then there are only better things to come. I think the last decade has afforded a certain perspective, which is that none of us can count on the government or a paternal employer to ensure our future; as such, it definitely behooves us to learn as much as we can about managing our finances and investments in order to ensure a retirement for ourselves. Our country, although decadent, is renowned for innovation so I'm sure we'll find a way to overcome our challenges in the years to come.
The most important thing is not to give up; life, after all, is not about running from challenges. While being born in another time may have meant economic/cultural/political security wishing to have been born in another time does no good whatsoever. Consider that those best equipped to face the toughest challenges are not those who close their eyes and coast along; rather, those of us who are truly gifted (not just by nature but by nurture as well) must believe that we are the ones who are best-equipped to triumph and (accordingly) act decisively and with purpose, even if the scope of our responsibility appears to be small (i.e. raising a family, working a corporate job, living within the context of a consumption-based society, etc.) I think there's definitely a lot more to life than a rat race but definitely not if you've given up and decided that everything you've been taught and everything you've learned was a waste of effort; if nothing else it should be clear that such an attitude is a slap in the face to the parents, teachers, coaches who invested time and effort into your potential.
[An aside: I hate to make a religious reference but in the Bhagwad Gita (one of the holiest of texts for Hindus) the incarnation of God (Krishna) tells Arjun (the hero) that he must act - no abdication of responsibilities will change the timeless realities of a duty to selflessly act for collective betterment (http://en.wikipedia.org/wiki/Bhagavad_Gita); the "tone" of the email really reminded me of the story so I felt like I should mention it.]
PS: I cut a bunch of stuff about college and work which was really just abysmal but I can send those things in another email; perhaps the tone would have been scattered and too depressing had I included those parts? They all make for great stories (like watching a dead guy get promoted before you do) but only if you go for that sort of thing... = /
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Thanks for writing and sharing your perspective, R. I am glad you are still optimistic despite some of the hardships you've had to face in the last few years. Yes those articles were quite interesting and echo a lot of what this email group and the nation as a whole have been feeling. It is strange how Americans are pessimistic about the federal government and economy in general, though closer to home they tend to be supportive of their local reps and satisfied with their life. Yes, maybe the media are dwelling too much on gloom and doom, and this recession is mostly psychological (but tell that to the people who just got foreclosed). Just because this recession isn't totally following traditional patterns (unemployment is still low, relatively, but what about under-employment?) doesn't mean it's any less severe. After recalculations, growth was negative in Q4 2007, and the GDP doesn't take into account inflation, a weak dollar, and the housing crisis. But I don't put much stock in such surveys that ask broad, qualitative questions, and it's always useful to determine their feelings relative to what. I am satisfied with my life compared to a day laborer, but of course there are many things that I wish could be easier. I disapprove of the job performance of our president and Congress, though our situation is still a lot better than say, China or Iraq. I do think that our economic health is not as good now compared to when many of us started college in 1998ish, due to inflation, resource shortages, the housing/finance situation, stagnating wages, and a widening wealth gap.
Unlike other Americans, I don't blame foreigners for our current economic funk. In fact, I commend the Asian nations for bringing millions of their people out of poverty (relatively), and the EU for working together and providing an alternative sociopolitical system to the American model (despite some similarities). As your article said, cheap Asian goods have given lower-income Americans access to previously-unaffordable products that potentially improve their quality of life (but also tempts them to over-spend on Wal-crap), and economic growth doesn't have to be a zero-sum game. But if other nations (China and the oil-producers in particular) are getting rich partially from scams and unfair trade practices, then that must be dealt with. Though that's not to say that the West doesn't employ its share of damaging protectionist policies and trade scams too, in order to profit at the expense of the poor.
Bottom line, we are to blame for the current mess, pure and simple. And the next president won't be able to fix it much, despite all the campaign rhetoric. There are natural boom and bust cycles, and it's funny how the Economist noted that some young people like us never even realized that downturns are normal, because we've been lucky to never live through bad times until now (we were a bit young to be directly affected by the last Bush recession of 1991-2). There are measures that the Fed and others can take to lessen the swings of the economic cycle, like in Europe. But no one seems to want to be a "party pooper" and plan for a rainy day during the boom times. We're too drunk on money to realize that the more we're growing, the harder we may fall later. Personally, I would much rather have a smoother economic cycle rather than huge booms followed by huge busts. Sometimes it's good to save a little and put the breaks on an economy that's too hot. Increased stability, security, and predictability are worth missing out on huge profits, and besides, the top 1% capitalize most on economic booms anyway. Plus the global War on Terror has cost Americans over a trillion dollars (including the higher cost of crude) that could have been used to shore up Social Security, improve public services, invest in green tech, or give tax/health care rebates. In his first term, Bush took our budget surplus and gave it away to the rich as tax breaks on capital gains and inheritance. And his recent economic stimulus package hasn't made much of a dent (many economists believe that such measures are just political gimmicks that don't fix anything), yet cost America more billions in future debt and less trust in the dollar.
To be honest, part of me wishes I was a baby boomer for how cheap and easy they had it in some areas. I know nostalgia is a rose-colored lens, but back then the family was truly the center of the world instead of the job. Happiness maybe took more precedence than ambition and accomplishment. Maybe they didn't have the BMW and big screen, but they could pay the rent, eat well, and go to Disneyland. We didn't have all the distractions of the "multitasking age" to take away from what is truly important, personal relationships. I feel more at home with '60s and '70s culture than the faster-paced and greedy '80s, '90s, and today. I'd gladly give up the Internet and HDTV! But as you said, it does no good to wish for the impossible. I do fault the baby boomers for getting rich by selling America's future down the river. We are struggling because of THEM, not globalization. They lived so decadently and irresponsibly, but did so in an era when sustainability was not really an urgent concern. So in a sense, I guess I shouldn't wish to be them, because they are the root of many of our current problems. So if those xenophobic politicians really want to find fault for our current recession, they should stop targeting Mexicans and Asians, and point the finger at themselves and their generation instead. The baby boomers pioneered comfortable but wasteful suburban living (to get away from all the colored people in the overcrowded cities), and the "soccer mom culture" added huge family vehicles to the already long American commute. Partly influenced by big auto, oil, and construction, the suburban living model is now dominant, more or less permanent, and basically incompatible with public transit, energy conservation, and other sustainability concerns.
Under baby boomer leadership, the Fortune 500 companies got filthy rich but engaged in all sorts of fraud and scams to make cheap bucks in the market (S&L scandal, Dot-Bomb, backdating stock options, creative accounting to hide losses, and now the subprime fiasco). Republican presidents gradually chipped away at many forms of economic regulation and oversight, increasing the chances of private sector abuse and excess (not to mention government corruption). The boomers also dismantled the paternal employer structure and made layoffs, mergers, union-busting, and other cost-cutting measures chic (fewer Americans are getting health coverage from their employers too). Gordon Gecko said "Greed is good", and efficiency is even better for Wall Street! But above all, the baby boomers left their stamp on American culture by making over-consumption not only acceptable, but attractive (dare I say necessary?). Buy more than you need, and buy it on credit! What are we going to do now that easy, cheap credit is drying up? Fashionable materialism is the new "baseball and apple pie", and there's more to buy than ever before - but does all that crap really make our lives any richer? It definitely makes our bank accounts poorer. But the problem is that our "robust economy" (and global trade) is almost dependent on Americans over-consuming to sustain growth. Actually cost-cutting measures by many American families are contributing to this recession, but thank goodness the weak dollar is making exports increase.
From the Economist: Between 2002 and 2006 the incomes of 99% rose by an average of 1% a year in real terms, while those of the top 1% rose by 11% a year; three-quarters of the economic gains during Mr Bush's presidency went to that top 1%. The baby boomers also disseminated the "me first" mentality that ironically leads to great innovation/accomplishment but also great injustice/greed. Who cares what happens to everyone else as long as I get mine! The rich robber barons of the Guilded Age used to be reviled for their greed (until they invested in philanthropy at the ends of their careers to rewrite their checkered legacies, like Carnegie and Rockefeller), but now CEOs and billionaire moguls are worshiped like deities. Devils have become role models (not that all of the mega-rich are devils, but you get my metaphor), and we would emulate them if we could. The Economist did reference that side study suggesting that our currently huge wealth gap (below) is inaccurate, because the things rich people buy have inflated much more than the things poor people buy. While this may be true, the rich don't HAVE to go to the day spa and country club. Of course luxury items inflate more than basic essentials (because of scarcity and fewer customers that can afford them), especially due to increased cheap imports from Asia. If the rich choose to continue to live decadently and waste more money on more expensive cars, clothes, furnishings, etc., no one should feel sorry for them. Actually that is a strong sign that the wealth gap is actually larger than the numbers suggest, because even in a bad economy the rich still feel comfortable to spend frivolously on overpriced goods/services, while the poor are cutting costs for basics like gasoline, rent, medicine, and food.
While I tend to agree with you that life is not about running from challenges, I am starting to question all the knee-jerk assumptions about Puritan work ethic, perseverence, and whatnot that we were indoctrinated with while growing up here. Preachers, nobles, and propagandists told the peasants, slaves, and proletariats all sorts of BS to keep them docile and productive. In some cases, life NEEDS to be about running from challenges. Many immigrant groups came to America precisely because they were running away from challenges, especially European Jews in the 1930s (running away actually improved their chances of survival). And it wasn't all sunshine and smiles when they arrived of course; they traded in a set of bad challenges for a new set that was fortunately more tolerable. Look at illegal immigrants and their situations. So yes, some people are leaving the mad-expensive Golden State and Eastern Seaboard for cheaper lifestyles elsewhere - maybe even overseas. Maybe they will need to change careers and it will be hard on their kids, but obviously they gave it a lot of thought and decided that this was best. Maybe they have "given up" and fled like cowards from adversity, or maybe they actually woke up, while the rest of us continue to stubbornly toil towards an early grave in the rat race. Each case is different, but bottom line, maybe it's not our place to judge people based on how they handle their challenges. Elvis said "walk a mile in my shoes" before you judge him. It is not "heroic" to force yourself and your loved ones to suffer through a losing situation. I am not saying that I am giving up and all is lost for people like us, but there has to be a line, and there's no shame in a carefully planned and rational retreat. Only an arrogant asshole like Hitler would keep sending poor young men to certain death at Stalingrad just because he refused to acknowledge the obvious.
I also don't approve of the guilt trip of "not wanting to let my parents/teachers/mentors down" with my life performance. I used to believe in that crap rather strongly when I was younger, and part of me still does (Asian brainwashing). But I really think if people love us (unconditionally), then they just want us to be happy. Of course if we're happy being a drug addict or some other self-destructive lifestyle, then maybe an intervention is warranted. I am sure they want us to realize or maximize our potential, but really - how can anyone know what that is? Even expert athlete scouts get it wrong on top college prospects. And the game of life is much more complicated than the game of football. How the hell would our parents or our teachers know what career or important life decisions will work out best for us? I know we should listen to them when we're young because we don't know shit and they can help us avoid mistakes. But I would hope that our mentors and loved ones don't have a set life path in mind for us to follow, and we will only disappoint them if we deviate (I do know many families like this though, and it strains their relationships a lot). They are not us; they don't understand us and don't know what we go through. Their lives were different, so really their advice may have little utility for us now. We can respect their viewpoints, but ultimately we have to make the call. And if that becomes a "slap in the face" to them, then so be it. We are their children, not an "investment" like a 30-year fixed T-bond. Yes they contributed a lot of resources and love to help give us a good start on life, but we have no obligation to provide them with a good rate of return (nice house, impressive job, lots of grandkids). We just do what makes sense and we do the best we can, and the rest is out of our hands. And it seems these days, more and more of our economic health is out of our hands.
So of course I don't know the magic formula for understanding life and one's role in it, but I think it is of utmost importance to think for oneself and make decisions accordingly, not beholden to other influences. Sure we can choose to take religion, family, work, teachers, media, etc. if they are trustworthy and important to us, but we shouldn't just blindly follow someone else's formula. The way I see it, with costs rising and wages/promotions not keeping up, the equation doesn't calculate in our favor. So either we need to make drastic changes to balance the equation, or we need to write a new equation. And many Americans have, by shedding this tired, cliched existence and trying something different. It's a risk to take the road less traveled, but sometimes it pays off.
The language that you use, like "best equipped to triumph" sounds Darwinistic, and that is probably deliberate. I would prefer a world where people are not "in it to win it". Life doesn't have to be a competition, and winning means different things to different people (and winning often means that many others "lost"). I don't want to win at another's expense, but I know I already have. I don't believe that everything I've accomplished and everything I've been taught has been a wasted effort; in fact we find out who we are through such experiences. And actually those lessons and experiences have partially shaped our views of the world and led us to write what we have in these emails. What I know for sure is that I don't want to let work or study define me. I want the people who love me to define me. The 10 most important experiences of my life have not occurred in an office, lab, or classroom. I do think that education is valuable and work is necessary, but they don't have to be the focus of one's existence. As Einstein said, don't let education get in the way of your learning. I fear that a lot of wealthy and upper-middle class baby boomer families do groom their kids to "win the game of life" at all costs. They win because they invest in the right places and follow the formula. They "learn the test", just like taking a SAT prep class makes you more able to ace that specific test, but not necessarily smarter or better equipped to succeed in college. I know most parents do love their kids and want them to have a good life, but some also want to live vicariously through them and bask in their accomplishments ("that's my boy!"). That is not what parenting should be about. They are actually doing a disservice to them in my view, and screwing the world over by adding another selfish, ambitious, take-no-prisoners prick to the already fragile mix. Really, why would anyone WANT to be an i-banker workaholic, corporate lawyer whore, or cosmetic surgeon sellout? Those jobs suck, have long hours, and drain the humanity from you. The only thing you get out of it are the huge ego trip and paycheck.
I know in this modern life, educated people have to learn to invest to survive. But I have been resistant for reasons that should be obvious from the tone of my economics-related emails. In "real jobs", you actually contribute labor, adding value to something or delivering some sort of discovery/service/product. Brokers and bankers just move numbers around on a screen to make money on the backs of others. They just transfer wealth from one place to another, buying and selling people (as Martin Sheen said in "Wall Street"), and not caring about the consequences (which may be severe and far-reaching). Of course profitable investing still takes skill and brains, so I acknowledge their talents. I'm being simplistic and I guess we all have IRAs/401(k)s so I'm a hypocrite too, but I do despise that kind of work. I guess it's necessary to capitalism, but we also get fraud and speculation, fueled by insane greed and traders trying to make more, more, more by taking shortcuts, breaking the law, or ignoring better judgment. I don't care if I'm not rich, but I want to make my money in an honest, dignified manner, and I want to EARN what I make, not by taking shortcuts or making an educated guess (a.k.a. gambling) on the market, which is what 70% of investing is, even for the pros. So yeah, I guess I'm risk-averse. I know I am being extremist here and not all of the investing world is evil, though I wish real labor could be rewarded better versus capital investment. But what am I smoking? :)
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Oh, forgot to mention that I am trying to be optimistic about the future though, even if the negative trend doesn't seem to be reversing any time soon. As you said, I try to believe in human goodness, common sense, and ingenuity to work our way out of problems. If we survived the Cold War and avoided nuclear holocaust, then maybe we can survive this economy. America is great because we are adaptable and resilient, and we do accomplish a lot of good and amazing feats when the chips are down. I just worry that the bad momentum will be hard to sway, because we really need to re-equilibrate this system that is too greedy, too inhumane, and too volatile. Like the Matrix, people are really indoctrinated in this unsustainable way of life, and may fight to preserve it (deceived by corporate and government propaganda and whatnot), even at great personal and global cost. You can lead a horse to water, but you can't make him drink.
So it will take a lot of dedication, discipline, moderation, and compromise from citizens and leaders alike. We are running out of time to get it right too, especially considering the growing resource wars, overpopulation, and climate change problems. Some of us believe that Obama is one of those "once in a century" leaders who may be able to accomplish the improbable, but time will tell. I know that he is expecting us to do our part. I am trying, but as you all know, it's damn hard at times.
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Sorry for another addendum, but I am scatter-brained and this is such a huge topic we're tackling. Regarding "toughing it out" and keeping on trucking in the game, I am all for that if there was somehow a better guarantee of future success and security. But of course I know that nothing is certain but death and taxes. For college, you know that if you take the right classes and get passing grades, you will emerge with a degree. But college is far from the real world, as we know. In the working world, you have no idea if you best efforts will even pay off (and in fact, may hurt you in strange ways!). So much is out of our control that moronic butt-kissers get rewarded and dedicated, talented team players get ignored and burnt out, projects die or get reborn, and corporate goals change on a whim. And even if you cut back spending and save diligently, there's no guarantee that will be enough for a home down payment, college tuition for your kids, medical bills, and retirement. I guess life has always been this uncertain, but with our social safety net crumbling, costs of living rising, and the consequences of bad luck/mistakes growing, there is much less room for error and fewer people who will get your back.
So to me, toughing it out for the sake of toughness is limiting, if not stupid. I would like some reassurances that our efforts will not go to waste, but I know I'm dreaming. Only your loved ones will say at your funeral, "He worked hard and played by the rules. Even though he never got a break, we are still proud of him." The rest of the world will say, "He busted his ass for nothing and now he's dead". If effort is reward enough, then more power to you. But I don't want to waste my age 30-50 years chasing a rainbow that may never come. But if I don't have a choice or don't have any better options, then I might as well keep on keeping on as Mark said.
