Holy shit. I read the whole thing. All three parts. And despite my self-imposed exile, I want to talk about it. FIRST: There are a lot of words. They are not well organized. They sort of circle around a few topics: 1) We already have a social safety net, but it's ad-hoc and powered by distaste 2) The higher education system has failed systemically but it will take a generation to shake out so it's a good thing we got (1) 3) The system has evolved (1) organically to protect (2) 4) "Hipsters." Sometimes I feel like I'm the only person who remembers the '90s. It might be because I was just coming to political consciousness when Newsweek was bitching about "Generation X" and what a shiftless bunch of ironic leeches we all were. I defy you to read the book we're named after and not see walls dripping in irony: That's a passage chosen at random. Written in 1991. See if you can spot the hipsters in here: http://www.youtube.com/watch?v=xDYGo0UgIVM Or fuck, how 'bout in here: http://www.youtube.com/watch?v=r9f9M6UAYb0 Now check this shit out. I'm gonna have to post that separately. HOLY FUCK: So what happened? Well, we invented the Internet. Not in a Tim Berners-Lee way but in a "we can buy and sell you from petty cash" way. Gerry Yang? GenX. Sergei Brin? GenX. All the money the Internet ever generated it generated because of GenX. Which made the 'Boomers STFU right quick. Now nobody even really remembers the phrase "Generation X" because we're the guys paying the bills while the 'boomers start collecting more social security than they put in. "Hipsters" have the deck stacked against them even more than GenX did. I caught the tail end of it - I voted in 1992, but by a scant week or two. I was one of the shining few who took the old SAT and the recentered SAT. I went to college before it came apart at the seams and had my first few jobs in the economy ruined by September 11. Apparently that makes my perspective unique. The kids are all right. That "social safety net" described in the linked article is a strawman. It's not steady-state. For one thing, unemployment doesn't last forever (trust me, I know). For another, the United States is busily dealing with "structural unemployment" - a lovely technical term for "jobs that are not coming back ever." It's going to be a long slow decline. Part of it is caused by those very "hipsters" - they don't buy much. They don't need cars. They use "irony" as an excuse to shop at thrift stores (hey, whatever works!). They support "hipster" restaurants, which is code for "keeps money closer to the point of sale" (85% of money generated by a franchise restaurant leaves the zip code of the franchise). And they deeply believe in the shit they buy, to a zealous degree. It's not exactly an anti-consumer mantra, but it certainly protects the local at the expense of the global. And the school thing can't continue. For one thing, Obama poked a big fucking hole in it through debt forgiveness. Some fun facts from my own life, excuse me for oversharing: My wife's doctorate cost $130k. She had a full ride to undergrad, as did I, so that's all the debt we got. Putting it on deferral for 12 months pushed it to $220k. So that's $100k in debt the "government" (more on that if asked) earned just by letting us get on our feet. We consolidated into an income matching program, the payments of which do not keep up with interest. By the time we hit Payment 360, at which point it all gets forgiven, our initial $130k debt will have ballooned to $2,600,000. But fuck you, we will have paid $163k. Fortunately she's in an "essential profession" which means that 360 payments gets cut to 120 payments half of which we've made. Here's the funny thing: the financial institutions we bank with consider that $2.6m income for purposes of banking. And I doubt we're the only ones. We've still got a house with renters in it up in Seattle. We refinanced from a 30 to a 15 and managed to keep the payments nearly the same - win/win. It's gonna be near-pure income right about the time my daughter starts looking for colleges. So we run some calcs to see how much 4.5 years of private school education is expected to cost when she's ready, and how much we need to set aside right now to get her there. The answer? "$2 million dollars" and "$1200 a month." Now, maybe there will be an education worth $2m in 2030. I doubt it. Even if there was, I'd be a lot more likely to buy my daughter a half-dozen Starbucks franchises and say "follow your bliss." And I can't be the only one looking at those numbers and deciding the system isn't sustainable. And maybe that's why I liked reading the article while also feeling like the article missed a whole bunch. For one thing, I've never met someone who describes themselves as a "hipster." It's a pejorative, not a class of people. For another thing, all this presumes that "hipsters" are helpless to their fate, that they're out of ideas or options, and that they aren't just as likely to subvert the paradigm and throw it in the faces of their parents as GenX did. Bill McKibben (GenX) argues in Eaarth that the way forward is distinctly hipster-like: Travel less, buy less, eat local whenever possible, use less energy and cultivate online relationships. Shannon Hayes (GenX) argues in Radical Homemakers that the way forward is to freeload until you have enough resources to live self-sufficiently off your own land. I know plenty of "hipsters" who know how to can vegetables. I know zero baby boomers who can do the same. I think it's gonna be okay. I really do. I think "ironically" working at a coffee shop is how you accept that your life isn't as rich as your parents' lives and it's probably their fault. But you know what? "Happiness is making more money than your brother-in-law." (Mencken) The standard of living is in decline. The "hipsters" are the vanguard and while you're looking down your nose at them, they're enjoying themselves. They will have the last laugh."Her hair was totally 1950s Indiana Woolworth perfume clerk. You know—sweet but dumb—she'll marry her way out of the trailer park some day soon. But the dress was early '60s Aeroflot stewardess—you know—that really sad blue the Russians used before they all started wanting to buy Sonys and having Guy Laroche design their Politburo caps. And such make-up! Perfect '70s Mary Quant, with these little PVC floral applique earrings that looked like antiskid bathtub stickers from a gay Hollywood tub circa 1956. She really caught the sadness—she was the hippest person there. Totally."
Well, enough is enough. As a baby boomer, I'm fed up with the ceaseless carping of a handful of spoiled, self-indulgent, overgrown adolescents. Generation Xers may like to call themselves the "Why Me?" generation, but they should be called the "Whiny" generation. If these pusillanimous purveyors of pseudo-angst would put as much effort into getting a life as they do into writing about their horrible fate, we'd be spared the weekly diatribes that pass for reasoned argument in newspapers and magazines.
I think it's gonna be okay. I really do. I think "ironically" working at a coffee shop is how you accept that your life isn't as rich as your parents' lives and it's probably their fault. But you know what? "Happiness is making more money than your brother-in-law." (Mencken) The standard of living is in decline. The "hipsters" are the vanguard and while you're looking down your nose at them, they're enjoying themselves. This and this are true, true, true. The "hipster"* lifestyle isn't a fucking rejection of anything, like media etc would have you believe. It's an embracing of a whole lot of things -- local business is just one of them (great point). It's like the slow food movement times 1000. You're damn right it's the vanguard, it's a reaction to the bizarre challenges people these days grow up with (e.g. buy your daughter the damn Starbucks franchises!). We have to lose this mentality of 'if you're not well on the way to paying down your mortgage and having two kids and a 501k and a desk job by the time you're 30 you're doing it wrong' crap. That's how the Boomers** did it, maybe. Unbelievably that perception still exists. Thinking that every generation should do things the same way ignores the many, many ways each generation's world is different. It's also, you know, stupid. I don't have much else to say about this that you haven't already said or that won't make me sound like an entitled/elitist bitch. (And I wish I did, because of what you wrote yesterday about the lack of thought around here lately and with the exception of a few excellent people I agree.) But here are some things I have learned from the way "hipsters" live: a) it is possible to eat and live healthily for basically no money ... and still have an extremely fulfilling life. b) It is possible to dress well and uniquely for basically no money ... if you are willing to be labeled a "hipster" for your trouble. Not, you know, poor -- just, "hipster." c) It is possible to travel almost anywhere in the world for very little money ... if you are willing to use your brain. d) "Subverting the paradigm" is admirable and often extremely rewarding. These are things I was not taught by watching previous generations, they are things I was taught by observing my own. Now, they may not be what "hipsters" set out to do, if they set out to do anything -- for it's not just a poverty movement, although it will be soon -- but these things are a side effect that any sane person my age should take advantage of. *uncomfortably using the word "hipster" even though it doesn't mean the same thing to anyone who uses it **uncomfortably using generational stereotypes that don't mean anythingThe kids are all right. That "social safety net" described in the linked article is a strawman. It's not steady-state. For one thing, unemployment doesn't last forever (trust me, I know). For another, the United States is busily dealing with "structural unemployment" - a lovely technical term for "jobs that are not coming back ever." It's going to be a long slow decline. Part of it is caused by those very "hipsters" - they don't buy much. They don't need cars. They use "irony" as an excuse to shop at thrift stores (hey, whatever works!). They support "hipster" restaurants, which is code for "keeps money closer to the point of sale" (85% of money generated by a franchise restaurant leaves the zip code of the franchise). And they deeply believe in the shit they buy, to a zealous degree. It's not exactly an anti-consumer mantra, but it certainly protects the local at the expense of the global.
And maybe that's why I liked reading the article while also feeling like the article missed a whole bunch. For one thing, I've never met someone who describes themselves as a "hipster." It's a pejorative, not a class of people. For another thing, all this presumes that "hipsters" are helpless to their fate, that they're out of ideas or options, and that they aren't just as likely to subvert the paradigm and throw it in the faces of their parents as GenX did. Bill McKibben (GenX) argues in Eaarth that the way forward is distinctly hipster-like: Travel less, buy less, eat local whenever possible, use less energy and cultivate online relationships. Shannon Hayes (GenX) argues in Radical Homemakers that the way forward is to freeload until you have enough resources to live self-sufficiently off your own land. I know plenty of "hipsters" who know how to can vegetables. I know zero baby boomers who can do the same.
edit: FYI -links in comment are literally just wikipedia definitions of the generations mentioned for those not too familiar. Is this cyclical? Does every generation think less of the next? Of course they do. The Lost Generation probably thought the The Greatest Generation were a lousy, no good group of wimps, until they saved the world. The Boomers thought the gen-x'ers to be lazy and complacent, but guess what... it's easy to "change the world" and "drop out" when mommy and daddy are flipping the bill (Boomers were the first trustafarians) until like you say, Gen-x'ers invented our new economy. The point is, each generation thinks the next is worthless until the crux of them come of age and do something meaningful. It seems to happen with each generation. The Millennial's will have their moment to shine. Your testimony about your wife's student loans mirrors our situation, I know we've discussed this in the past. One thing we had to do was to file taxes separately so that our loan repayment isn't effected by our household income but only her income. The system is extremely broken and the cost of higher education is no longer justified. aside: We are currently debating some big questions in our household about finances and opportunity costs. Do we buy another house and put down 20% or do we rent? If we rent we have a large chunk of capital to invest in the market. Realestate doesn't have the ROI that it used to. Money is cheap right now, but still we are currently seeing a 16% return on some of our mutual funds, that's hard to say no to. We could rent and buy a rental property. We could rent a house and start buying a new rental every year. I'm thinking this may be the route to go. The rental market's good where I live. Side question: Do you use a property management company for your rental? If not, is it a pain being so far away from your property? Any horror stories about tenants or has it been good? Back to the article:So what happened? Well, we invented the Internet. Not in a Tim Berners-Lee way but in a "we can buy and sell you from petty cash" way. Gerry Yang? GenX. Sergei Brin? GenX. All the money the Internet ever generated it generated because of GenX. Which made the 'Boomers STFU right quick. Now nobody even really remembers the phrase "Generation X" because we're the guys paying the bills while the 'boomers start collecting more social security than they put in.
I've never met someone who describes themselves as a "hipster." It's a pejorative, not a class of people.
-It's not a term of endearment. I have a cousin that had a great job in marketing for Kraft. He designed the labels and such of many every day products. He couldn't stand it anymore and has just recently bought a piece of property to start an organic farm in Michigan. He's MUCH happier. I think what we are seeing is a redefining of "success" that has less to do with monetary achievements and more to do with, I don't know how to say it... but maybe even spiritual achievements?The "hipsters" are the vanguard and while you're looking down your nose at them, they're enjoying themselves.
-Well said.
Worth pointing out: nobody hates on their own children. The 'boomers did not spawn the GenX'ers. The "Baby Boom" is everyone born after VJ Day in 1945. They came of age during the Vietnam war. The "Greatest Generation" gave birth to the 'Boomers. By contrast, Generation X is everyone born to the generation born before VJ day. There's obviously lots of overlap, but we're really talking about two overlapping cohorts. Thus, most of the GenX hate came from the 'Boomers; most of the Millenial hate comes from GenX. Shameless plug time: one of the subreddits I rescued is /r/realestate, which was a sinkhole of SEO linkspam but I beat it back to usefulness. It's now a haven for real estate investors. The answer to your question is complex. Large foreign blocs have been purchasing single family dwellings as rental opportunities, driving up the prices of everything under $380k. You have to understand: Real Estate has NEVER been a decent speculative investment, outside a few hapless bubble years. Real Estate doesn't even track the Dow. However, income property is a very safe and secure investment traditionally pursued by conservative investors. Anything other than buy'n'hold is a misstep. Your mutual funds will crash, it's just a matter of time. I used to play with them and I did damn well, primarily by betting against the American economy from 2004-2009. However, current financial prospects are disquietingly tied to legislation which follows no real rules. I'm in ratcheting index funds now. We have a property manager. There's no other way to fly. It takes exactly one eviction to make ten years worth of property management fees worthwhile. Our approach to finding one was we asked people we saw moving out who managed the property and if they liked them. When we got the same answers ("this lady" and "yes") three times, we called her up. We then let her decide what renovations to make to the place prior to opening it for rent. It cost me $6k in improvements but the place hasn't been vacant for a day in five years and we've been through four sets of tenants. I don't even know their names. The latest bunch I know literally nothing about them and I'm totally fine with that.Is this cyclical? Does every generation think less of the next? Of course they do.
aside: We are currently debating some big questions in our household about finances and opportunity costs. Do we buy another house and put down 20% or do we rent?
Commenting so I don't forget this. I recently did two things: 1 started self managing our Roths, and 2: bought a rental. I suspect our Roth handlers skimmed, and I suspect you are right about a property manager. I feel there is a rift fast opening in our country, and having a daughter has given me powerful incentive to get her on the good side of it. My dad was in Nam, grandpa in WWII. Am I gen Y?
George Packer's The Unwinding is an interesting read. It cemented to me that I wasn't imagining it, the middle class is vanishing, and not in a "we're all getting richer" sort of way. You have a choice: be rich or be poor. Both choices are equally valid; both choices have their upsides and downsides (granted, one has more upsides, thus it's the one desired more often). One thing is certain, though - If you don't choose, your choice will be made for you. Your generational assignment depends entirely on when your parents were born. Before VJ day? GenX. After VJ day? GenY. Makes sense? No, but there it is.
Really? So, my granddad was born in the 1890's and my dad in the 1950's. By this reasoning, my dad is not a Boomer?Your generational assignment depends entirely on when your parents were born. Before VJ day? GenX. After VJ day? GenY. Makes sense? No, but there it is.
Yea, this is what gets my panties in a twist (I'm 22). It seems that a "hipster" lifestyle, whether its disparagingly described in Salon or stated without the yellow journalistic froth, is a viable alternative to "go to college and get that job" to an increasingly larger amount of people from my generation. I don't want my future to be devoid of meaningful contribution to society, a life I spend sarcastically making coffees or pretentiously waiting tables and looking down at the Wall Street Banker's MILFy wife, but it seems that it's getting harder and harder to make a meaningful contribution to society and make a living from it. And it'll only get harder. This may be one of those things you wrestled and figured out "ten years ago" with a skill (mixing and audio engineering) that rests at the sweet intersection of avocation and vocation, and I'm genuinely happy for you, but me and (I believe) my generation want an outlet for all this pent-up empathy. I'll ask then: you bought 12 months of deferral for 100,000 dollars? Wha... How is that income? Are they assuming you borrowed 130k to further lend out at an even higher interest rate? OK, my head is spinning. Private school is going to cost about half a mil a year by 2030? That's completely unsustainable. College isn't power, it's the trappings of power. And people are (slowly) realizing it already, when school costs a tenth of that. In the beginning you referred to the social safety system that's ad-hoc and powered by distaste. Read this, which certainly deserves it's own hubski post but I'm having trouble getting anyone to read it.For another, the United States is busily dealing with "structural unemployment" - a lovely technical term for "jobs that are not coming back ever."
My wife's doctorate cost $130k. She had a full ride to undergrad, as did I, so that's all the debt we got. Putting it on deferral for 12 months pushed it to $220k. So that's $100k in debt the "government" (more on that if asked) earned just by letting us get on our feet.
Here's the funny thing: the financial institutions we bank with consider that $2.6m income for purposes of banking.
So we run some calcs to see how much 4.5 years of private school education is expected to cost when she's ready, and how much we need to set aside right now to get her there. The answer?
"$2 million dollars" and "$1200 a month."
Sure looks that way, don't it? Except that money is never going to be actualized. It's a made-up number. My wife has a former colleague who hasn't paid a dime on her student loans since graduating in '97. They're just up there being deferred forever. Not easy, but it can be done. Not our income… their income. They own these loans. Fully paid off, they're worth this much. Behold: the makings of a financial crisis. Just wait until some clever fuck starts selling derivatives on student loan debt. I was off by a bit - I misremembered it scarier than it was. it's still terrifying. Run it yourself: head here. Go "4 year private" "7 percent" "5 years" and "100%." Pick "18 years." Worst-case? Sure. But that's me sending my daughter to a decent private college for an extra semester or two and paying for the whole thing out of pocket. I got $820k. 7 percent wasn't a guess, by the way, it's a historical average. 1) Put a social worker through grad school 2) Whose father was an inner-city psychiatrist 3) Whose best friend (and father of the social worker's sister's boyfriend) was a VA social worker and 4) Whose aunt and uncle were 100% disability SSI schizophrenics. No news here, cuz. I lived this shit from '96-01. Now talk to me about my buddy with Lyme, who's 100% disability, which means when he is feeling well enough to work we have to pay his dad.I'll ask then: you bought 12 months of deferral for 100,000 dollars?
Wha... How is that income? Are they assuming you borrowed 130k to further lend out at an even higher interest rate?
OK, my head is spinning. Private school is going to cost about half a mil a year by 2030?
Read this, which certainly deserves it's own hubski post but I'm having trouble getting anyone to read it.