A New Deal For The Young
#1
I've only been saying this since the financial crisis. Good to see that the zeitgeist is finally catching up...

David Aaronovitch

Not so very long ago I went into my local pharmacy, picked up my prescription and waited for the bill. I looked at the assistant and she looked at me. There was an awkward pause. Then she read my mind. “You don’t have to pay any more,” she told me. And I thought God, am I really that old? Followed by, why am I getting a subsidy I don’t need? Then, but isn’t it rather nice and don’t I kind of deserve it? It took me almost a full day to recover from the ambivalence.

And then this week a chap called Dennis Reed set it off again. Mr Reed is director of a pensioners’ group called Silver Voices. He had been involved in discussions with the BBC and was angry that the corporation was planning to go ahead and make most over-75s pay the licence fee. You may recall that this benefit, worth £157.50, was introduced by Labour in 2000 and funded by the government. Then in 2015 it was decided that the BBC would pick up the tab for it from this year onwards, at a possible annual cost of about £750 million. However, it was left to the BBC to decide whether the subsidy would continue and at what level.

The intention was, I believe, to force the BBC to make significant budget cuts to pay the fees of all over-75s. But the BBC demurred. Instead it is charging over-75s who are not on pension credit (ie who are not poorer pensioners), so that the cost is reduced to £250 million. It’s this that has incensed Mr Reed. He’s cross with the government and cross with the BBC for not resisting the government. And now, he says, he plans to ballot his members on whether they should boycott the licence fee.

I have a fair idea what would happen if Mr Reed succeeded in his campaign, at least as far as the BBC is concerned. To put it at its starkest, he is advocating a course of action in which an unneeded subsidy to pensioners would lead to job losses for a number of younger people. This is, of course, not his intention.

It’s no one’s intention, and yet it’s a pattern of generational redistribution that seems to have set in both in this country and elsewhere. Part of it is about state action, part of it is about private assets. In the decade following the great crash, median disposable incomes of retired households in Britain increased by 16 per cent, and those of non-retired households by just 3 per cent. Where retired households had been £70 a week worse off than working ones in 2001, by 2017 they were £20 better off. The Resolution Foundation found that one in five pensioner families had one or more person in employment, and that growth in private pension incomes and public benefits had been the most important factors in the growth of their income.

During the period of austerity the triple-lock pension guarantee meant that pensioners were shielded from the consequences of restricted spending, where families were not. To put it brutally, it has been an OK time to be a pensioner and a bad one to be a poor child. This week it was announced that the state pension increase in the spring will be the 2.5 per cent minimum decreed by the guarantee, in a year when inflation looks set to be 0.5 per cent at most.

Another trend has been to make so many pensioner benefits universal and to means test everyone else’s. Since, according to some estimates, we have a couple of million over-60s who possess more than £1 million in assets, this undiscriminating generosity seems a little perverse.


And it’s not just here. I’ve been reading a new book, The Upswing, by the celebrated American political scientist Robert Putnam. Early on in the book there’s one of the most extraordinary graphs I’ve seen recently. It has two lines: one is the value of government/state spending per person on the elderly and the other is spending on the poor. In the postwar period these lines almost track each other in a 45-degree rise, so that by the end of the 1960s monthly assistance to both was about $900 per month.

And then, abruptly, the lines begin to diverge. By 2001 the monthly figure for pensioners had risen to $1,483. For the poor it had dropped to $392. This is an extreme version of what has also happened in Britain.

I remember why policy changed in the way it did. As a 12-year-old in the 1960s my comprehensive school in Holloway encouraged us to run errands for poor pensioners. One old man, living alone in a dank basement, was of the Great War generation. I can remember everything about that room, its smell, about his tattered clothes and about him. It couldn’t go on.
But now, with the gigantic exception of the problem of social care, pensioner poverty is not our greatest concern. And it’s possible to argue that resources many pensioners don’t need could be better applied to helping younger people, but that the voting habits across the democracies mean that older voters turn out more assiduously to defend their gains.
Might this help to explain this week’s study, carried on our front page, showing a dissatisfaction on the part of the young with democracy itself? According to the mega-survey of five million people, those in their twenties and thirties had markedly less faith in democratic institutions than their forebears had at the same age. This falling off was particularly noticeable in the Anglophone countries.

You can theorise about why this has happened and throw in social media, the decline of deference and many other factors, but the link between material improvement and political satisfaction is a pretty well-tested one. In other words, we could be seeing a kind of slow Weimar Republic, in which a loss of prospects gradually detaches the young from a commitment to liberal democracy. If mainstream politicians don’t pay attention to this, a door will be left open for a smart populist who can harness young people’s grievances.

And that’s all before the pandemic. Out there, the jobs market for graduates and school leavers is murderous and the employment situation for millions who are clinging on to often poorly paid jobs is precarious. Even when we bounce back after the pandemic, the situations of millions of young people will have been altered for the worse. Here in Britain, as if that wasn’t bad enough, their elders have managed to saddle them with Brexit, often championed by semi-domiciled billionaires who will never feel the effects of what they have wrought.
Older people of Britain, we have a task ahead. The country needs a plan to rescue our young from disillusion and despair. No, more than a plan. It needs to change its priorities. And that means us giving up some of what we have, in taxes and loss of benefits, not attaching ourselves limpet-like to our freebies.
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#2
Agree with all of that with a couple of points around the youth's faith in democracy - because the youth have more access to information (and disinformation) they can analyse the lies from many more angles and it is clearer now more than ever how much the politicians simply lie to protect themselves and get what they want. And also the comparison to the Weimar republic is very apt, especially with our populist leaders that we have (Read 'The death of democracy' by Benjamin Carter Hett, it does highlight how easy it was to get power through the elected house, public offices and judiciary and it isn't too heavy considering the subject matter).

Good post Proth - thanks
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#3
Good to see you agree:

"Here in Britain, as if that wasn’t bad enough, their elders have managed to saddle them with Brexit, often championed by semi-domiciled billionaires who will never feel the effects of what they have wrought."

Actually, like the author, I was amazed that we don't pay for presciptions now we are over 60.  I feel a bit embarrassed.
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#4
It may have taken over a decade but I suspect those under 35 may finally be waking up to the silent raid on their future carried out between 2008-09. The next big polaristaion in politics will be between the middle class asset rich and the middle class asset starved. It's going to be brutal.
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#5
There is another looming issue for the middle class asset rich which will come when interest rates start to rise and their mortgages rise in line. I can't see anyone protected tbh.
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#6
(10-22-2020, 09:02 AM)baggy1 Wrote: There is another looming issue for the middle class asset rich which will come when interest rates start to rise and their mortgages rise in line. I can't see anyone protected tbh.

Perhaps I should have termed it "equity rich". Rising interest rates will hurt the young proportionately more, and help the fixed income elderly. Suppression of interest rates is probably one of the most corrosive elements of government policy over the last decade worldwide. Given the importance of keeping rates low to service £trillions in debt I can't see rises anytime soon. I'd be amazed if we not in for another decade of sub 2%.
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#7
(10-22-2020, 08:56 AM)Protheroe Wrote: The next big polaristaion in politics will be between the middle class asset rich and the middle class asset starved. It's going to be brutal.

I thought you said it was going to be Public vs Private sector workers!

https://wbaunofficial.org.uk/showthread....#pid226517
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#8
(10-22-2020, 11:02 AM)JOK Wrote:
(10-22-2020, 08:56 AM)Protheroe Wrote: The next big polaristaion in politics will be between the middle class asset rich and the middle class asset starved. It's going to be brutal.

I thought you said it was going to be Public vs Private sector workers!

https://wbaunofficial.org.uk/showthread....#pid226517

That's the next big culture war. Do keep up Wink
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#9
It’s hardly news the Boomer generation has damaged every generation after them. It’s an economic, social and cultural war that they will eventually lose. They will however lose it in relative comfort.

They have saddled millions of younger people with their debt, given us Brexshit (still waiting for the list of benefits) made houses unaffordable to millions, given / or enabled an unstable job market and wail at their ‘normal’ changing whilst redefining normal themselves a few decades ago. A very selfish generation (with obvious exceptions).

One observation popularism is alive and kicking already in the form of this government and previous to that the Vote Leave campaign. Which is why the article is correct in its assumption that younger generations are fed up with politics but it’s popularism that now that is destroying democracy. Younger people don’t trust politics anymore because those in power notably this government blatantly lie, mislead, offer half truths on an industrial scale, in person, to the media and via social media without any sanction, quite the contrary it is rewarded. They have campaigned and will deliver Brexit upon a younger generation which the overwhelming majority of them didn’t want. They do not in general see migration and cultural norms changing as a threat to them and yet they are told constantly it’s wrong and should be stopped / legislated against. This is to name just three reasons for their dissatisfaction. The popularism that is the bedrock of this governments methodology is driving thousands / millions of to despair at what democracy has become. It’s driven by popularism defined by older generations. Add to this our first past the post antiquated and undemocratic voting system it’s no surprise that our current political climate does little to persuade younger voters there’s any point in main stream politics.
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#10
(10-22-2020, 02:18 PM)Derek Hardballs Wrote: It’s hardly news the Boomer generation has shafted every generation after them. It’s an economic, social and cultural war that they will eventually lose. They will however lose it in relative comfort. 

They have saddled millions of younger people with their debt, given us Brexshit (still waiting for the list of benefits) made houses unaffordable to millions, given / or enabled an unstable job market and wail at their ‘normal’ changing whilst redefining normal themselves a few decades ago. I cannot think of a more selfish generation.

One observation populist bullshit is alive and kicking already in the form of this truly appalling government and previous to that the Vote Leave campaign.

Yet I suspect you'd oppose anything and everything that would improve the situation.

I'm glad I'm not a Boomer as well. You seem very angry about them.
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