Millennials Might as Well Belong to a Wealth Gap Caste System
There’s mounting evidence “Millennials” are fundamentally at an economic disadvantage with a rising wealth gap, rising student loans, rising cost of housing and the prospect of job disruption via automation. There’s great pain coming, and Millennials falling out of the Middle class might become the norm.
I translate LinkedIn storylines into articles, and a common theme around the interwebs is how Millennials are institutionally disadvantaged and economically handicapped, since the Great Recession of 2008. It’s so insidious and so life-altering it might as well have been designed as a scam to disadvantage young people.
Millennials Are the First Global Socially Responsible World Citizens
Millennials are increasingly facing wealth inequality and trying to choose healthy alternatives. Millennials are also inheriting climate change consequences that are a direct result of older cohorts failing to take the problem seriously. A recent report suggests that Arctic continues warming accelerates at twice the pace of mid-latitudes and is likely to see warming of up to 5 C as early as 2040. Melting permafrost could accelerate global warming that could cause serious global challenges sooner than anticipated. The report goes on to state:
Millennials Inherit a Broken System
“Adaptation costs and economic opportunities are estimated in the tens of trillions of U.S. dollars.”
Millennials are the most inclusive generation in history, embracing interracial and inter-belief marriage and pioneering for things like same-sex marriage, that was recently passed in Australia (but only exists in 26 countries). Millennials also inherit much of the collective karma of previous generations whose short-term greed contributed to the state young people face today. Being victims of inequality, also makes some Millennials the new champions for social justice.
Sky-high tuition rates, rampant inequality, banks taking advantage of vulnerable young people, and corporations who disrupt the job market, more than they create new jobs — is conditioning young people to adopt value systems that sound more like socialism than capitalism. What could this mean for the future leadership of the planet?
Millennials Face Massive Wealth Gap
Millennials are embracing things like decentralized cryptocurrencies and ICOs because they want to crowdfund a better world.
However millions of Millennials remain trapped in a system that favors the 1% wealthy elite and limit their opportunities. Opioid addiction, mounting tension with migration, a rise of right-wing populism (see Europe), Brexit and any number of significant challenges remain.
Millennials in wealthy economies like the US, Germany and France are positioned to become the most economically unequal generation in recent memory. Coincidentally, the most diverse and inclusive generation in history are basically being screwed over by the billionaire class.
I won’t be the first or the last to tell you, the rise in inequality among those born in the 1980s or 90s is due to several different factors, including rising student debt levels, a widening income divide between those who graduate from university and those who skip college altogether. There’s also growing and accelerating wealth disparities between those who inherit money from parents and other relatives and those who do not inherit, among other factors.
Tax policies that favor those who inherit money and those whose income comes primarily from investments stand to further exacerbate these trends, according to the literature. Massive global corporate firms will in 2018 become Trillion dollar companies, and those same companies get tax benefits, stash their loot in offshore tax havens and manipulate and limit competition in foreign new markets. Amazon’s entry into India to dominate the future of e-commerce there, is such an example. While Chinese firms fund Indian startups, and local companies like Flipkart, Amazon will likely destroy it. American companies like Google and Facebook by trying to take over the world in their domains, limit innovation and stockpile global talent. However, there’s some indication the technological colonialism of American firms, is coming to an end.
If wealth-inequality continues for young people in the West, this does not bode well for the future of the global economy.
A new analysis by Credit Suisse suggests that millennials in several advanced economies are likely going to face the worst income inequality of any generation in recent memory.
If you thought global warming or the rise of artificial intelligence and its regulation were big issues for Millennials, you haven’t seen anything yet with the problem of wealth inequality.
It’s likely, it’s the main obstacle to global economic growth and equality ever faced in the history of homo sapiens. You know it, younger GenZ people know it, and whatever capitalism becomes, we are quickly nearing a big event that could transform it. Of course, to put it in other terms, the 1% would prefer you didn’t care about how you are being screwed over.
A System that Exploits Millennials
According to a study on the demographics of wealth in 2015, If you’re over 62, your odds of having at least $1 million in net wealth (your total assets minus your total debt) are relatively achievable — about 1 in 7. But if you are under 40, your odds are low: 1 in 55.
For startups and in tech, the majority of Unicorns now come out of China, as access to Silicon Valley funding tends to go to local (California based) firms. Meanwhile in China, the state and major tech companies pour funds into their top startups even with regional cities having a specialization in a particular domain of tech. For the future of innovation and AI, this means that the corruption of Silicon Valley and the U.S. Government is directly responsible for China beating out the U.S. in the future race to AI, automation and global influence in tech.
While brands treat Millennials as if they are all middle-class, many Millennials I know can’t afford a vacation and haven’t yet achieved career stability, in short (and may never), we aren’t the rising luxury consumers of GenZ China. When Singles’s Day amassed $45 bn. in sales, you begin to understand how the western Millennials place in the world is radically being altered and different from millions of young people in Asia.
In the U.S. millennials are more likely to go to College but are saddled with student loans that have risen astronomically, but offer less value than ever before. Between 1963 and 2013, the average price of college more than doubled. As significant skill gaps occur, the decline of the quality of a US education becomes more and more apparent. Millennials on the other hand, might enjoy a reputation for craving “experiences over things”, but can they even afford these experiences?
Automation and AI Could Hit Millennials in their Prime
For Millennials it really is a sick world. While millennials who go into high-demand fields such as tech and finance, do reap the rewards of a more expensive education, they often won’t earn more than their parents, and pay a higher price. This means more competition and hitting into the wall of automation right in their prime, in their 30s and 40s.
This means more Millennials than ever before are staying single (living alone if they can afford it), not having a family, and in survival mode. Unfortunately for the global economy, Millennials and GenZ may have less discretionary income, which could be bad news to stimulate retail and consumption. Remember, robots don’t spend. Let’s face it, the majority of Millennials who fall into affluence will have simply won the birth lottery, and be there due to inherited wealth privilege.
There’s evidence young people today not only won’t earn as much as their parents, but won’t live as long and be at far higher risk for being unable to achieve even a baseline of what was once considered the “normal” of the American dream. Having a house, starting a family, and enjoying a comfortable life. That’s no longer normal for Millennials to enjoy.
In 2017, the number of billionaires has gone to 46, by judging by how their companies operate, there’s more corporate oligarchy at work than ever, than a reality of what Mark Zuckerberg talks about building global communities. Economic pain for younger generations also means an epidemic of decline of trust in collective institutions by the same generation. Trust in banking systems, a college degree, politicians and democracy, capitalism — are all arguably, at all-time lows. There’s little doubt if Bernie Sanders has been chosen to run vs. Donald Trump, who would have won.
The dismantling of the future of Millennials is how you permanently damage the future-proofing of the West. This among other factors, guarantees China out-competing with America in the future race to AI, technological influence, sustainable tech and being the global super power. We are already seeing signs of this, in how China has taken a very different stance to green energy, ecological urban planning and moving away from coal and towards electric vehicles. The American Millennial is screwed.
It turns out American capitalism has a caste-system, and if you happen to be under the age of 35, chances are you are more vulnerable to being at the bottom of the heap. What we once called the Middle Class, is destined to keep shrinking in proportion to a quickly rising wealth-inequality.
Correct me if I’m wrong?