The generation of millennials born after 1995 have been shaped by the debt-growth induced 1990s’ period of boom and prosperity, which was driven largely by rising asset prices. The good side of generation Z is that they are not interested in wars (they seldom ever belong to warmongers) and care little about politics. Unfortunately, they have only a scant knowledge of the meaning of “freedom” and “personal responsibility”.
However, they are concerned about political correctness, about having the latest-model iPhone and the number of likes their photos receive and how many followers they have on Facebook. But most of all, they are concerned about extracting as much as possible from the government in the form of subsidies and other kinds of benefits. It is a generation that avoids hard work (such as on the factory floor), and is content to work part-time in bars and restaurants, and to live a carefree existence. It is also the generation whose major contribution to civilization may be the invention of “retirement before working.”
Needless to say, this concept of retirement before working has been fostered and encouraged by governments, which, with their generous transfer payments, make it more economical for some people not to work, and to collect all kinds of tax-free benefits, than to have a low-paying occupation and pay taxes.
Edward Luce concludes his review of Tyler Cowen’s The Complacent Class by noting that Cowen believes,
[S]ociety may be returning to a cyclical view of history in which human progress is no longer something we will automatically expect. We may take a generation or so to adjust to the new reality. Millennials are already leading the way. They are the least angry group of Americans politically, perhaps because they have grown up with more realistic expectations than their elders. Bleak though this sounds, millennial passivity is in some ways reassuring, Cowen believes. The anger that carried Trump to the White House may be but a stage on the path to society’s acceptance of lower growth.
In most other ways, Cowen’s thesis is deeply troubling. Democracy requires growth to survive. It must also give space to society’s eccentrics and misfits. When Alexis de Tocqueville warned about the tyranny of the majority, it was not kingly despotism that he feared but conformism. America would turn into a place where people “wear themselves out in trivial, lonely, futile activity”, the Frenchman predicted. This modern tyranny would “degrade men rather than torment them”. Cowen does a marvelous job of turning his Tocquevillian eye to today’s America. His book is captivating precisely because it roves beyond the confines of his discipline. In Cowen’s world, the future is not what it used to be. Let us hope he is wrong. The less complacent we are, the likelier we are to disprove him.
The Distortion of Time and Work
(Final thoughts from John)
What both Cowen and Faber are talking about is a trend that I believe is going to accelerate. In the last few centuries we have seen an enormous displacement of the workforce, particularly in agriculture as the Industrial Revolution took hold and triumphed. We went from 80% of the country working on farms in 1820 to less than 2% today.
This is not just a US phenomenon. I found this cool chart that shows the share of the labor force working in agriculture in the major European countries, going back to 1300. England is down to 1.2%.
But those massive changes played out over 20 or so generations. Now, we are witnessing wholesale change in numerous industries in less than half a generation. In a recent TED Talk, Elon Musk showed off a mysterious semi-tractor capable of hauling extraordinarily large loads using electrical power. They have had the prototype for maybe a year. In less than five years, companies will be able to purchase a completely electrically powered self-driving truck. I am sure the first trucks will have a place for the driver to sit, but it won’t be long before the need for drivers will disappear. Ditto for taxis and other local transportation. Six million taxi, Uber, and truck drivers will find themselves out of a job. In 10 years. That is not much time to adjust your career path.