Japan PM: No Mandates or Discrimination Against the Unvaccinated

 

The loss of civil liberties as well as civility resulting from the COVID pandemic will haunt the United States and young people in particular for decades to come.  

The way that American politicians speak to us belies the contempt that they have in their hearts for the people of this country.  The division between the people and powerful in the United States has become particularly evident in the last two years.    

While leaders of many other nations address their countryman as intelligent individuals capable of evaluating risks and taking appropriate measures, American politicians like Joe Biden constantly talk down to American citizens. 

Contrast the rhetoric of American politicians and government officials with those in Japan. 

The Japanese government offers a balanced view of vaccine risks and completely rejects mandates and discrimination based on vaccination status.   

From the Japan Ministry of Health website:

Although we encourage all citizens to receive the COVID-19 vaccination, it is not compulsory or mandatory. Vaccination will be given only with the consent of the person to be vaccinated after the information provided. Please get vaccinated of your own decision, understanding both the effectiveness in preventing infectious diseases and the risk of side effects. No vaccination will be given without consent. Please do not force anyone in your workplace or those who around you to be vaccinated, and do not discriminate against those who have not been vaccinated.

The Prime Minister of Japan took a similar measured, adult tone in his address to the nation in which has also rejected mandatory vaccinations and urged people to avoid discrimination against the unvaccinated. 

From Prime Minister Kono’s speech:

Vaccines will never be administered without the recipient’s consent. We urge the public never to coerce vaccinations at the workplace or upon others around them, and never to treat those who have not received the vaccine in a discriminatory manner.

Contrast the measured, reasoned statements of Japanese officials with the near-hysterical rhetoric of Joe “dark winter” Biden and Anthony Fauci. 

Contrast also the rejection of mandates in Japan with the authoritarian requirements and restrictions imposed by Joe Biden, Charlie Baker and now Boston Mayor Michelle Wu.  These mandates demonstrate that politicians like Biden, Baker and Wu don’t believe that the American people are intelligent enough to make their own healthcare decisions.

Japan’s politicians and government officials offer and treat their countrymen with respect.  American politicians and government officials treat their countrymen with disdain. 

Hopefully the American people will soon tire of being talked down to and will find leaders that respect the intelligence and reason of the American public.  Until then we are lions led by donkeys.

New Harvard Youth Poll Out

Results of the fall 2021 Harvard Youth Poll are now out.  I'll be commenting on the results in future blog posts.  

Many young Americans are in a pessimistic mood.  

Approval of the Biden Administration is down.  Young people are divided on whether the Biden Administration is a failure or if it is too early to tell.

This round of the poll asked a large number of questions concerning the level of anxiety that young people feel regarding the future of our country and whether democracy is working.

Researchers also asked about the willingness of young Americans to serve in the military if they were called up.   

The Harvard Survey provides an extremely useful tool for taking the pulse of young Americans.  

A Game Changer for Higher Education

How many times have we heard “if you don’t like it here, go somewhere else”?  That presents a problem for colleges and university faculty as higher ed in America is uniformly woke.  A group of academics has a promising solution—start a new college. 

The University of Austin (UATX) is a new university.  UATX is dedicated to free inquiry, free speech and innovation in instruction and curriculum.  At the same time, UATX plans to keep education affordable by keeping administrative and overhead costs down. 

The founders of UATX are established academic and public policy leaders including historian Niall Ferguson, author Bari Weiss, former AEI president Arthur Brooks and economists Larry Summers, Glenn Loury and Tyler Cowen. 

Universities were once places of discovery and excitement.  As Niall Ferguson writes, UATX seeks to restore the campus environment to that he experienced in his student days. 

“Those of us who were fortunate to be undergraduates in the 1980s remember the exhilarating combination of intellectual freedom and ambition to which all this gave rise. Yet, in the past decade, exhilaration has been replaced by suffocation, to the point that I feel genuinely sorry for today’s undergraduates.”

Ferguson is right. I too was an undergraduate in the 1980s. The freedom and excitement of undergraduate and graduate college life that I experienced is rare today.

  Study after study have show that cancel culture and conformity have taken over academic life in the United States and other Western countries. 

Universities are not just failing to live up to their ideals regarding academic freedom.  They are also failing to provide value to students.  The cost of attending the typical college has almost tripled since 1980 while earnings of college graduates have remained flat. 

UATX promises to provide a home for scholars and students disaffected by the current college climate.  It also provides an alternative business model for students and parents fed up with funding bloated university bureaucracies with the tuition and tax dollars.    

The Generational Unfairness of COVID Restrictions: European Edition

 

Young people in Europe increasingly view the never-ending lockdowns and COVID restrictions as unfair to their generation.  Young Europeans have sacrificed their careers and education to address a virus that only presents a risk to the very old. 

Moreover, the restrictions and lockdowns have made no difference in fighting the virus.

Laure Mandeville lays out the reasons that young Europeans are angry.  Ms. Mandeville is the chief U.S. correspondent for Le Figaro and a Senior Fellow at the Atlantic Council.

Below is a clip from Ms. Mandeville’s appearance on Feudal Future podcast with Joel Kotkin and Marshall Toplansky.

You can see the whole podcast here.

He’s Not Wrong: Vladimir Putin Knocks Woke Culture

 Social justice warriors in the modern West are no different that the Bolsheviks of the old Soviet Union says Russian Leader Vladimir Putin. 

If Putin is right, modern progressives are ushering in a world that is very dark indeed.  Young people should take note.    

Speaking at the Valdai Discussion Club, Putin laid bare the parallels between the old oppression of the Soviet past and the now oppression of the woke progressives in the modern West.

Putin calls out the erasure of the great works in art and literature: 

“Looking at what is happening in a number of Western countries, we are amazed to see the domestic practices, which we, fortunately, have left, I hope, in the distant past. The fight for equality and against discrimination has turned into aggressive dogmatism bordering on absurdity, when the works of the great authors of the past – such as Shakespeare – are no longer taught at schools or universities, because their ideas are believed to be backward. The classics are declared backward and ignorant of the importance of gender or race. In Hollywood memos are distributed about proper storytelling and how many characters of what colour or gender should be in a movie. This is even worse than the agitprop department of the Central Committee of the Communist Party of the Soviet Union.”

Citing Martin Luther King, Putin call out the obsession among the left in dividing people on racial lines:

"Countering acts of racism is a necessary and noble cause, but the new ‘cancel culture’ has turned it into ‘reverse discrimination’ that is, reverse racism. The obsessive emphasis on race is further dividing people, when the real fighters for civil rights dreamed precisely about erasing differences and refusing to divide people by skin colour.”

Putin also cites the parallels between modern progressive ideologies on sexuality and gender and those of the old Soviet Union:

“Zealots of these new approaches even go so far as to want to abolish these concepts altogether. Anyone who dares mention that men and women actually exist, which is a biological fact, risk being ostracised. “Parent number one” and “parent number two,” “'birthing parent” instead of “mother,” and “human milk” replacing “breastmilk” because it might upset the people who are unsure about their own gender. I repeat, this is nothing new; in the 1920s, the so-called Soviet Kulturtraegers also invented some newspeak believing they were creating a new consciousness and changing values that way. And, as I have already said, they made such a mess it still makes one shudder at times. Not to mention some truly monstrous things when children are taught from an early age that a boy can easily become a girl and vice versa. That is, the teachers actually impose on them a choice we all supposedly have. They do so while shutting the parents out of the process and forcing the child to make decisions that can upend their entire life.”

It has often been said that those who do not learn from history are doomed to repeat it.  Putin’s discussion of the parallels between the old Soviet Union and modern Western progressive ideologies is a good one.  One question remains.  Is it that modern progressives have failed to learn from the old Soviet Union or are using the old Soviet Union as a “how to” manual?

 

Poll: Young People Reject Defunding the Police

 

A new poll by the Pew Research Center shows solid support for more funding for the police among young people.  The poll, taken in September 2021, found that 36 percent of Americans aged 18-49 support more funding for the police and another 40 percent support maintaining current funding levels.  Less than one in four—23 percent—want funding reduced.

Older Americans are overwhelming supportive of more funding with 59 percent supporting more funding and only 7 percent supporting less.

Americans of all races, ethnicities and political leanings all reject defunding.  Only one in four Democrats wants funding reduced.  Details from Pew appear below.

The unfortunate truth is that the defund the police movement has been terrible for young Americans.

Young people are more likely to live in urban areas than are older Americans and therefore more likely to be in cities like New York, Chicago, Portland, or Boston where funding for the police has been cut by progressive left-wing Democratic mayors. 

The toll on young people from the murder and mayhem resulting from police cutbacks has been enormous. 

Take the case of Chicago.  In 2019 Chicago elected a mayor who backs the defund the police movement.  Since that time the number of homicides involving young Chicagoans has skyrocketed.

In 2019, 365 Chicagoans under the age of 36 we killed.  In 2020, 570 Chicagoans between the ages of 0 and 35 were killed (including 101 teenagers and 14 that were younger than thirteen).  Chicago is on pace to beat 2020.  So far in 2021, 509 young Chicagoans have been murdered. 

The additional deaths of 400 young Chicagoans over the past two years provides stark evidence of the harms caused by the defund the police movement.   

The same trends are evident in Portland, Seattle, New York City, and Minneapolis—all cites with mayors and city councils that have defunded the police. 

Perhaps it is direct experience or that of friends or family with rising crime that is turning young people off to the defund the police movement.  In any event, the newfound appreciation for the police and law and order among young Americans is good news indeed.   

Senator Scott Explains What's Wrong with the Federal Reserve

This blog has been highlighting how Federal Reserve policy hurts young people:

• How negative interest rates harm young people by making it very difficult to accumulate wealth as inflation erodes the value of savings.
• How QE and low interest rates pump up asset prices forcing young investors to buy into overvalued asset markets and exposing young people to losses from asset price crashes.
• How low interest rate policies lead to the accumulation of government debt the burden of which will be borne by future taxpayers.
• How the accumulation of debt by government leads to greater risk of economic downturns and how these downturns harm the long-run prospects of young people that come of age in bad economic times.

Recently Florida Senator sent Federal Reserve Chair Jerome Powell a letter outlining his concerns.  The letter addresses many of the above topics albeit without specific reference to the impact on young Americans.

The Scott letter deserves a close read.  Follow this link to Senator Scott's letter.

 

This Blog Stands Against Censorship

 

The Truth About Free College

Democrats claim that free college would be a panacea for young people.  But what does free college really mean?  Generally, free education means poor quality education. 

Germany provides a great example. While German universities are free or at low cost (tuition is generally less than 1000 euros) the quality of education they provide is poor.  I can attest to that.  It is very rare to encounter a faculty member at a German university at a research conference.  No German university ranks in the top 50 worldwide whereas there are 8 in the United Kingdom.  

An excellent review of the state of higher education in Germany and the problems with tuition-free higher education is provided by Andrew Hempel in Quillette.   

"Yet the tuition-free system also has disadvantages. The first difference an American will notice is that most German universities look dingy and threadbare. Many were erected hastily in the 1960s and 1970s to house new students brought in by liberalizing reforms, and these cheap, poorly maintained structures are notoriously ugly (a German magazine recently ran a feature on “German Universities Ranked by Ugliness”). Most classrooms still feature rigid wooden or metal desks bolted into rows. Wireless coverage, library stocks, laboratory gear and classroom A/V equipment lag far behind the average American state university. It’s still possible to arrive to give a lecture and find an overhead projector awaiting your transparencies. Professors’ salaries are much lower than in the United States, and Germany’s problem with “adjunctification” and precarious conditions for aspiring scholars (known by the German neologism Prekarisierung) is becoming as urgent as it is in the United States.

This bare-bones regime also dominates student life and counseling. German universities are sink-or-swim: if you have scholarly or personal problems while studying, help will come only from overburdened counselors with hundreds of cases, or from student volunteers. Along with lax admissions standards, this fact helps explain the high dropout rates; one-third of all students who enroll in German universities never finish. A recent OECD study found that only 28.6 percent of Germans aged between 25 and 64 had a tertiary education degree, as compared to 46.4 percent of Americans (although classification issues mean these numbers must be handled with care). This chronic lack of resources—in addition to the understandable fact that many outstanding German scholars publish in German—also helps explain why German universities punch below their weight in international rankings, a topic of obsessive concern to German politicians.

Eliminating tuition also means that universities become more like primary schools, or public utilities. This changes the dynamic in subtle ways. Universities will become more vulnerable to funding decisions by agencies, leading to more intrusive control and bureaucracy. Gather any group of German professors, and talk will immediately turn to the burgeoning bureaucracy which distracts them from teaching and research. This changed dynamic also makes it harder to get funding from alumni and third parties. Would you donate to the local sewage treatment plant? Hardly; these things should be funded from tax revenue and, of course, user fees. Making universities fully state-supported also raises a host of issues under competition and public-utilities law. For this reason (among others) naming buildings or professorships after private donors is still fairly uncommon at German public universities, and “executive education” or outreach courses may be banned or regulated to prevent unfair competition with private-sector offerings."

German Election Results Show Young People Are Sick of Establishment Politicians

 

In September, young Germans voted overwhelmingly for change by rejecting the two establishment parties.  Are young Americans also ready to change politics in the United States? 

Unlike the United States, Germany has several major political parties though two, the Christian Democratic Union (CDU) and the Socialists (SPD), have run the country since WWII.  In the September national election young Germans rejected both parties.  Instead, the top voter getters among young people were the libertarian Free Democrats (FDP) and the progressive Greens each with 23 percent of the youth vote.  That may not sound like a lot by US standards.  But consider that the CDU and SPD combined gathered just 25 percent of the vote among voters between the ages of 18 and 22.

The concerns that led young people to reject the CDU and SPD sound a lot like the concerns of young people in the United States. 

Young Germans voted for change because they were sick of the government’s COVID restrictions. Reuters reports:   

Many young voters saw the FDP as a defender of their liberties and freedoms during the pandemic, Schnetzer said, when the government closed schools and universities, restaurants and fitness studios while keeping factories open to safeguard the economy.  School closures amounted to around 30 weeks since March last year compared to just 11 in France, U.N. data shows. The FDP was against blanket closures and wanted to give schools more power to decide if and when to close. Young voters "believe their well-being and interests were low on the government's priorities list during the crisis", Schnetzer said.

The other is that the establishment parties were out of touch with issues of interest to young voters including the soaring costs of Germany’s equivalent to the U.S. social security system.  From the Wall Street Journal:

Simon Schnetzer, a researcher who studies youth culture, says how the young voted partly reflects their sense that the big parties have been too focused on serving the older voters that are the bulk of their electorate, thus neglecting long-term issues from combating climate change to fixing education, promoting digitization, and plugging the pension system’s funding gap.

The CDU is like the George W. Bush wing of the Republican Party in the U.S. and the SPD like the old-time labor Democrats.  Both are in sharp decline in the United States especially among young people.  Like young Germans, young Americans are looking for new solutions.    

Will young Americans find a pro-opportunity, pro-freedom message like that of the FDP as appealing as young Germans do?  I hope so.  

The purpose of this blog is to point out to young Americans how the establishments of both parties in the United States and their special interest clienteles are shafting young people.  I will continue to do so in the future.    

Young People Sour on Biden

A new poll from the Pew Foundation finds that young people now have the lowest job approval rates for Joe Biden.  Results appear below.  Perhaps they are now realizing that they will be paying the bills for the Biden presidency for the rest of their lives.  Even worse news for Biden is that 30 percent of blacks and over 40 percent of Hispanics and Asian disapprove of the job he's doing.

The Modern World Explained in One Picture

 

Engine of Generational Inequality

The Mises Institute has a great post on how QE has driven up wealth inequality in America.  Read the whole thing! And buy Katherine Petrou's book (you don't need to get it from Amazon either--you don't need to deal with oligopolists). 

While the QE discussion is framed as one that benefits the wealthy at the expense of everyone else there is another dimension which I have been blogging about.  Ultralow interest rates benefit asset owners most of whom are baby boomers and older.  On the other hand, low rates hurt asset purchasers who have to buy into overvalued markets or save at rates that are below inflation--negative interest rates.  Asset purchasers and savers are mainly young people who0 are looking to accumulate some wealth in the economy.  By pulling assets returns forward QE reduces the returns earned by asset purchasers and increases their exposure to downside risk.

The most recent chatter from the Federal Reserve is that they could maybe, possibly start reducing QE by the end of the year.  This is way too late.  By historical measures assets prices are way overinflated. The Fed's own financial stability report warns of heightened risks from declines in asset prices.  

I would rate the possibility that the Fed reduces QE in the next two years as slim to none.  Biden's deficits means that Treasury needs to find a lot of places to stuff Uncle Sam's paper.  Most of that for the past two years has been put on the Fed's balance sheet.  Look for that to continue as spending and deficits continue to swell.       

Another Consequence of the Lockdowns for Young People

 Over the next decade the consequences of the COVID lockdowns will become increasingly apparent.  This is especially the of the costs to young people who bore little risk from COVID but suffered mightily from the measures taken to protect the old and infirm from the disease.  

The CDC is now warning that the lockdowns have created an epidemic of obesity among young Americans.  As if this couldn't have been foreseen from closing the gym and schools and most ridiculous of all, restricting people from going outside in the fresh air.  

From the Epoch Times:

The Centers for Disease Control and Prevention (CDC) said children and teenagers in the United States saw their body mass index (BMI) increase at almost double the normal rate during the COVID-19 pandemic, suggesting that COVID-19 lockdowns and rules may have contributed to the higher-than-usual weight gain.

According to the agency’s Morbidity and Mortality Weekly Report, released Thursday, officials noted that individuals aged 2 to 19 saw their BMI “increase approximately doubled during the pandemic compared to a prepandemic period,” adding that “persons with prepandemic overweight or obesity and younger school-aged children experienced the largest increases.”

The Research is In: Trigger Warnings are Useless

Trigger warnings are useless and may be counter productive so say two professors from Carleton College.  Writing in the Chronicle of Higher Education (paywall), Professors Amna Khalid and Jeffrey Aaron Snyder discuss a review of 17 studies.  The result, trigger warnings do nothing and actually increase anxiety of those with PTSD. 

The consensus, based on 17 studies using a range of media, including literature passages, photographs, and film clips: Trigger warnings do not alleviate emotional distress. They do not significantly reduce negative affect or minimize intrusive thoughts, two hallmarks of PTSD. Notably, these findings hold for individuals with and without a history of trauma. (For a review of the relevant research, see the 2020 Clinical Psychological Science article “Helping or Harming? The Effect of Trigger Warnings on Individuals With Trauma Histories” by Payton J. Jones, Benjamin W. Bellet, and Richard J. McNally.)

We are not aware of a single experimental study that has found significant benefits of using trigger warnings. Looking specifically at trauma survivors, including those with a diagnosis of PTSD, the Jones et al. study found that trigger warnings “were not helpful even when they warned about content that closely matched survivors’ traumas.”

What’s more, they found that trigger warnings actually increased the anxiety of individuals with the most severe PTSD, prompting them to “view trauma as more central to their life narrative.” “Trigger warnings,” they concluded, “may be most harmful to the very individuals they were designed to protect.”

 A few weeks ago I was a participant in a webinar Harvard University. The speaker warned the audience before presenting a table of statistics.  Yes, statistics.  If students can't handle look at a table of numbers, yes numbers, America is lost.  

Why Men Don't Go To College

The Wall Street Journal has a long piece on low rates of male college enrollment in the United States.  Enrollment rates among white men are lower than among other racial groups after accounting for family income.

Men are abandoning higher education in such numbers that they now trail female college students by record levels.

At the close of the 2020-21 academic year, women made up 59.5% of college students, an all-time high, and men 40.5%, according to enrollment data from the National Student Clearinghouse, a nonprofit research group. U.S. colleges and universities had 1.5 million fewer students compared with five years ago, and men accounted for 71% of the decline.

This education gap, which holds at both two- and four-year colleges, has been slowly widening for 40 years. The divergence increases at graduation: After six years of college, 65% of women in the U.S. who started a four-year university in 2012 received diplomas by 2018 compared with 59% of men during the same period, according to the U.S. Department of Education.

In the next few years, two women will earn a college degree for every man, if the trend continues, said Douglas Shapiro, executive director of the research center at the National Student Clearinghouse.

That men are not enrolling in college.  Most colleges are ultra-woke.  Nobody wants to be charged exorbitant tuition rates to be treated as an oppressor for four to six years.  In addition, most white collar employers discriminate against men in terms of training and promotional opportunities.  That is particularly true of government and quasi-governmental organizations.  

That's the Way it Usually Works Out

 

Social Security Runs Out in 2034

The Social Security System is going to run onto the rocks long before young people hit retirement.  The new report from the trustees of the Social Security System predicts that the trust fund is going to run out in 2034.  That means big tax increases or benefit cuts for the Gen X, the Millennial generation and those generations to come.   

To illustrate the magnitude of the 75-year actuarial deficit, consider that for the combined OASI and DI Trust Funds to remain fully solvent throughout the 75-year projection period: 

(1) revenue would have to increase by an amount equivalent to an immediate and permanent payroll tax rate increase of 3.36 percentage points to 15.76 percent; 

(2) scheduled benefits would have to be reduced by an amount equivalent to an immediate and permanent reduction of about 21 percent applied to all current and future beneficiaries, or about 25 percent if the reductions were applied only to those who become initially eligible for benefits in 2021 or later; 

(3) some combination of these approaches would have to be adopted. 

Social Security is a better shape than Medicare.  

Harvard Professor: Vaccine Passports Don't Work

Professor Martin Kulldorf, a Harvard epidemiologist has been making the case against COVID passports and mandates.  In a recent post, he notes the discriminatory effects of the mandates against the working class.  A similar analysis could be applied to the differences in the effects on the mandates on the young versus the old.  Young people have an extremely low morality risk from COVID in the first place but they have suffered far greater harm from the lockdowns and mandates that the old.   

In part, the harm to young people is from a failure to follow The Science.  The accepted wisdom of epidemiologists from the outset was to isolate the vulnerable populations and let everyone else continue with their business.  The CDC and most Western countries did the exact opposite.  Isolate everyone and lockdown the economy.  The longer term effects of these failed policies are increasingly becoming apparent.  It is too bad that many places are intensifying these failed policies through vaccine mandates and passports.  However, at least Denmark has the right idea.  
 

Amherst College Students Hate Lockdowns

Even posh kids are fed up with lockdowns.  American colleges have long resembled left-wing madrassas in terms of ideological uniformity so perhaps it's fitting that they adopt the same social practices.   

BOSTON (AP) — Hundreds of students at Amherst College in Massachusetts are pushing back against what they call the school’s overly restrictive COVID-19 protocols that include double masking indoors, restrictions on off-campus activities, and no in-person campus dining. ...

Students are allowed to leave campus to take care of personal business and to pick up takeout meals, but should not go to restaurants, cafes, or bars, she said.

More here. 

College Students Say Biden Has Failed

 

Buyers remorse sets in on campus: Students Disown Joe Biden After Endless 'Disaster'

COVID Panic Propaganda is Harmful

Story out of the Boston Herald on hospitals being swamped by psychiatric patients as a result of the lockdowns and COVID hysteria.  It is not surprising as the political class and meia have been telling us for a year and a half that the world is a terrible, dangerous place.  

COVID-induced job losses, fear and isolation have all taken a toll, as well as delays in seeking care, leading to a regular bottleneck of over 500 patients per day in the state awaiting specialized psychiatric care, according to a survey by the Massachusetts Health & Hospital Association conducted this summer.

Patients are also sicker — a new impact of the pandemic — including “patients with severe psychosis, patients with severe depression or other mood symptoms or anxiety that lead to suicidal thoughts, patients coming in after suicide attempts,” said Dr. Sejal Shah, medical psychiatry chief at Brigham and Women’s Hospital.

The toll on young people is particularly high.  Brad Polumbo writes that college students are literally frightened out of their wits.  College used to be fun.  Now it's got the feel of an internment camp.

Government restrictions on daily life during the pandemic have fueled a youth mental health crisis . Yet, even with many of these restrictions now lifted, young people are still living in a hysterical state of fear.

Likely as a result of this widespread fear, 61% of students think their schools should impose restrictions on attending parties and large social gatherings. 

There’s just one problem: There’s almost no basis for any of these fears, and college students are living scared of their own shadows for no reason.

For one, COVID-19 does not pose and has never posed a high risk of death or hospitalization for individuals of college-age. (With the rare exception of those with preexisting conditions that compromise their immune system, individuals for whom many diseases are life-threatening.) Yes, COVID-19 is a serious virus and has claimed many lives. But the deaths are almost exclusively among those much older than the college demographic.

According to the Centers for Disease Control and Prevention, roughly 6,744,362 Americans aged 18 to 29 have tested positive for COVID-19. Among that same age cohort, an estimated 2,951 have died. These figures allow us to calculate a rough fatality rate of 0.04%. This means that if 10,000 members of this age group contract the virus, four will die. And these rates are assuming no vaccination! The available vaccines are highly effective at preventing infections serious enough to lead to hospitalization or death — even for the delta variant . So, for vaccinated students, the risks are even more minuscule.

Gen Z Least Interested in Remote Work

Remote work is not turning out to be a great thing for those starting their careers.  You don't get the skills and connections that come with on-site work.  When asked whether they'd be willing to take a 5 percent pay cut to be able to continue to work at home, members of Gen Z were the least likely to want to take that bargain.  

Smart move.  Remote work isn't all that it is cracked up to be.  Millions of young people will find it harder to build networks and develop their talents when interaction with others takes the form of Zoom calls versus the give and take of workplace interactions.  That will stunt young careers much more than that of the Millenials and older generations that have had the benefit of close contact with colleagues.  

Good News: Gen Z Least Likely to Approve of Censorship

Bad news: Gen Z is more likely to approve of censorship of freedom of speech than in 2018.  According to Pew two-thirds of Democrats want government or big tech to censor speech.  

Roughly half of U.S. adults (48%) now say the government should take steps to restrict false information, even if it means losing some freedom to access and publish content, according to the survey of 11,178 adults conducted July 26-Aug. 8, 2021. That is up from 39% in 2018. At the same time, the share of adults who say freedom of information should be protected – even if it means some misinformation is published online – has decreased from 58% to 50%.

Terrible news for the country and for young people.  The ability to express oneself is the most basic of human freedoms.   Young Americans are heading into a new dark age.  In many ways, they have themselves to blame.  Stop voting for Democrats would be a good start.

More results below:

Gen Z Hates Cancel Culture

Gen Z standing against cancel culture.  Good.  

An interesting example may lie in the experience of the unlikely conservative icon of Scott Cawthorn, the creator of the videogame series Five Nights At Freddy’s. Cawthorn might initially seem like an odd figure to represent conservatism in pop culture. His videogame series is about a fast-food restaurant where animal robot mascots go on murderous rampages at night, and the player, as a security guard, must avoid being killed in gruesome manners. On paper, it is exactly the sort of violent videogame that parents in the early 1990s would have sought to “cancel,” lest it corrupt their kids. And today it has established an enormous fanbase among teenagers, including, for some reason, gay and lesbian teens.

When it was revealed that Cawthon had donated extensively to both Senate Majority Leader Mitch McConnell and President Donald Trump, however, he came under sustained attack online from publications accusing him of “betraying” his “LGBT” fanbase. But something interesting happened. While most media publications, generally staffed by millennials, rushed to condemn him, on social media, YouTube, Twitter, and TikTok, Gen-Z users rallied to his defense. So after initially condemning Cawthon, many of the millennial journalists quickly shifted to expressing horror that teenagers could possibly defend Cawthon on Twitter and in public, attacking them instead.

The Soviet Union Is Gone, but the Young Yearn for Socialism

 Read the whole thing. 

Picking Your Pockets for .... Nothing

It is bad enough that politicians are saddling young people with enormous debts.  But even worse is that much of this money is being wasted.  

Current entitlement programs are rife with abuse. Their size and lack of guardrails to protect taxpayer dollars open the door for bad actors to take advantage of the system. But rather than acknowledging and addressing these issues, the Biden administration wants to dramatically expand the welfare state, which will undoubtedly result in even more waste, fraud, and abuse.  

Since 2003, when agencies were required to report these payments, the Government Accountability Office estimates $1.9 trillion in improper payments have been made. But that might just be the tip of the iceberg because the GAO maintains it is unable to “determine the full extent to which improper payments occur.” 

In fiscal year 2020, more than 21% of Medicaid’s federal program spending was the result of improper spending, which means one-fifth of taxpayer dollars, intended to help roughly 77 million low-income and medically needy individuals, has been lost without helping those Americans. Medicare was similarly disastrous, with $43 billion in improper payments—money that should have helped provide health care for the 63 million elderly and disabled currently receiving Medicare benefits.  

Outside of Medicare and Medicaid, three other significant sources of improper payments are for the earned income tax credit, unemployment insurance, and supplemental security income. Almost a quarter of the payments made for the earned income tax credit in FY2020 were improper—this amounted to $16 billion. Of the benefits paid by the Department of Labor for the unemployment insurance program, 10% were improper payments, which accounted for $8 billion. The Social Security Administration similarly spent almost 10% of the Supplemental Security Income funds on improper payments during FY2020—amounting to $5.3 billion. 

Afghanistan: The Bigger Cultural Picture

Brendan O'Neil writes about how the West lost in Afghanistan.  Not a military loss.  That would be bad enough.  It was a loss for Western Culture.  The Taliban found a West that no longer believed in itself.  The Taliban did.  Lost in a multicultural haze and moral relativism the West had no ability to criticize the Medieval morality and actions of the Taliban let alone promote values like individualism and freedom.  The Afghan project became one of dishing out cash to the corrupt politicians and generals and welfare to the peasants.  Below is an excerpt.  

But above all of that, above even the political and military incoherence of the American empire, there is the corrosive cultural dynamic. This might just be the most important factor in the Afghan humiliation – the fact that the US, and the West more broadly, clearly lacks the cultural resources necessary for a clash of civilisations. This wasn’t just a territorial battle, a fight over the land of Afghanistan. It was also a cultural clash. It was a war between one side that has very strong beliefs and is more than willing to die for them, and another side that doesn’t know what it stands for anymore and would rather avoid risk and self-sacrifice if at all possible. I’ll leave you to decide which of these is the Taliban, and which the US.

This was always the West’s problem in Afghanistan: it lacked faith in the very values it claimed to be delivering to that benighted country. We will liberate women from life under the burqa, Western officials said. But isn’t it ‘Islamophobic’ to criticise the burqa, or any other Islamic practice for that matter? Our elites have insisted for years that it is. We will replace your intolerant Islamist system with a civil society fashioned by clever professors, the West promised. But isn’t it judgemental and possibly a tad racist – certainly an offence against the ideology of multiculturalism – to imply that Western democracy is superior to Islamist theocracy? As one British think-tank says, in its definition of the term ‘Islamophobia’, it is wrong to suggest that Islam is in any way ‘inferior to the West’. The West’s post-9/11 bluster was continually undermined by the West’s broader descent into moral relativism. How can you assert the civilisational authority of Western values when your entire educational and university system is devoted to questioning and demeaning Western civilisation? You cannot partake in a clash of civilisations if you loathe your own civilisation.

Anyone who thinks the Taliban did not pick up on all of this, on the Potemkin nature not only of the Afghan government but also of Western civilisation itself, is kidding themselves. The Taliban will have watched as the mighty American military became bogged down in discussions of critical race theory and the problem of ‘white rage’. They will have clocked the British army’s recruitment drive that was aimed at ‘snowflakes’ and ‘me me me millennials’ – for real – on the basis that such people have the ‘compassion’ necessary for the touchy-feely wars of the 21st century. They will know that the contemporary West is shame-faced about its history and its civilisational values and lacks ideas for how to turn its fragile youths into a fighting force, and they will understand their own life-and-death devotion to Sharia as being the opposite to all of this. They know this was a cultural clash as well as a military fight, and that they were by far the stronger side on this front.

This is the truth: America and its Western allies are too consumed by wokeness to be able to pursue a moral or military struggle for their values. The past 20 years of this slow-burning Afghan humiliation have been a modern case of fiddling while Rome burns. An intolerant Islamist army gains in strength and plots its return to power while the American and British armies obsess over how to become more trans-inclusive, which gender pronouns to use (the Royal Air Force’s list includes ‘ze’, ‘per’ and ‘hir’), how to make training exercises more inclusive of ‘snowflakes’, and how to fight wars without offending the enemy. Who can forget when US navymen wrote ‘Hijack this, fags’ on a bomb destined for Afghanistan and all hell broke loose? Such ‘spontaneous acts of penmanship’ are completely unacceptable, said the then US rear admiral. The Taliban was fighting to the death for its theocratic vision – the West was squabbling over offensive words.

This is why the comparison with Saigon is an illegitimate one. Back then, the US was forced into retreat by powerful external forces – the Vietnamese, of course, and also the anti-war movement in the US, in which vast swathes of the youth and significant sections of the elite turned against the war. The Afghan humiliation, in contrast, is a product almost entirely of internal disarray – of the exhaustion of American politics, of Western geopolitical nous, and of the West’s belief in its own project and its own values. There is nothing positive whatsoever in how the Afghan War has ended. It is a disaster for the Afghan people, a devastating blow to the confidence of the United States, and another backward step for those of us who believe that the values of democracy and freedom are superior and are worth fighting for. The Afghan calamity will cast a long shadow, for a long time.

Read the whole thing.

   

The Millennial Wealth Gap

Millennials that are in or approaching their high earnings years are finding out that they are not as prosperous as previous generations.   The problem is high debt and the effects of having lived through two deep recessions early in their careers.  From the Wall Street Journal:  

Older millennials in their high-earning years are also still working to recover lost ground from previous bouts of unemployment or underemployment caused by the 2008 financial crisis, according to a 2020 study from the National Bureau of Economic Research.

“You carry that with you for a long time, maybe your whole career,” said William Gale, one of the authors of the study and a senior fellow in the Economic Studies program at the Brookings Institution.

Do you, or does someone you know, expect the late 30s to early 50s to be the high-earning years? Join the conversation below.

The study—which examined household wealth across generations using data from the Survey of Consumer Finances, a survey conducted every three years by the Federal Reserve—found that the 2007-09 recession significantly reduced wealth for all age groups, and younger cohorts in particular. In 2016, millennial households held around 12% less wealth than did households headed by a person of the same age in 1989.

In 2019, the Federal Reserve Bank of St. Louis found older millennials’ debt-to-income ratios to be 23% higher than expected, based on previous generations at similar ages.

The overall real average wage of 2018 had the same purchasing power as it did 40 years ago, Drew DeSilver, a senior writer at Pew Research Center, wrote in an article. That means despite the strong gains in earnings and a growing post-pandemic labor market, many millennial households may not see more flexibility in their budgets, according to Mr. DeSilver.

Depression Soars Among Young People

Panic purveyors in the media and political class have had a heavy toll on young people.  A new study shows that depression and suicide rates among young people have soared as a result of the social isolation imposed by the pandemic.  

School closing have been particularly hard on young people.  The school closing are particular wrong headed because schools have not been shown to be centers for the transmission of COVID.  

"Being socially isolated, kept away from their friends, their school routines and extracurricular activities during the pandemic has proven to be difficult on youth," said lead researcher Sheri Madigan.  She is an assistant professor in the department of psychology at the University of Calgary, in Canada.

"An important consideration for keeping schools open should be the mental health and well-being of youth," Madigan said.  Children tend to thrive when their environment is predictable, and in-person learning allows for more consistent routines and structure, so keeping schools open may protect children from mental health problems, she said.

The increase in suicide and depression rates is particularly alarming.

Dr. Victor Fornari, vice chair of child and adolescent psychiatry at Zucker Hillside Hospital in Glen Oaks, N.Y., said he has seen firsthand the increase in mental health problems among the young.  "We've seen in our emergency rooms a 50% increase in suicidal adolescents presenting over the past 12 months and an almost 300% increase in admissions for eating disorders amongst adolescents," he said.

The pandemic has been stressful for adolescents as they struggle with home instruction and virtual schooling, Fornari said. "School is their social network. Without being with their peers, their friends, they're in a more stressful environment at home."

Not Your Parent's Economy

 Charles Hugh Smith from Of Two Minds blog explains how changes in the economy have resulted in massive inequality in America.  

This wholesale transfer of risk from elites to the workers is finally becoming consequential as wealth / income / security inequality is reaching extremes that are destabilizing society and the economy. As Gordon Long and I explain in our new video, The World Just Got a Lot Riskier crony capitalism has transmogrified into predatory capitalism as government, finance and the corporatocracy have allied into a seamless (and seamlessly corrupt) elite class that has offloaded systemic risk onto the unprotected class.

This is a bad development for young people who have no memory of a country where the middle class was much larger and mattered.  The passage pointing out how Federal Reserve's negative (real) interest rate policies are devastating small savers is well worth reading.  

4. Federal Reserve policies have destroyed safe yields on savings and money-market accounts, forcing workers to take on the enormous risks of the rigged stock market casino (which is rigged to benefit high-frequency traders, front-running trading houses, and those with asymmetrically distributed information, i.e. insiders).

A COVID Apology from the Media

In an extraordinary statement the chief editor of Bild, the largest German newspaper, apologizes for harming young people and especially children with all the scaremongering over COVID.   The apology  is a blunt admission of the harms caused by the media and government.  He says:

"Millions of children in this country, for whom we are all responsible as a society, I would like to say what our Federal Government and our Chancellor have not dare to say so far: We ask your forgiveness. We ask your forgiveness for a year and a half of politics, who sacrificed you."

The statement, which is in German but with English subtitles, is available here.  

This blog has pointed out on several occasions that high cost of the lockdowns and the fearmongering of the media and the political class.  Let's hope that the statement by Reichelt is a crack in the wall of media disinformation about COVID and its consequences for the population.  

Poll: Gen Z Most Opposed to Cancel Culture

Good news.  A new poll by the Morning Consult shows that Gen Z is the most opposed to cancel culture.  

Bad news: Millennials are most in favor of cancel culture.  

Ziad Jilani has the story:

Perhaps surprisingly, given its progressive leanings and similar social and political beliefs to the millennial generation, Gen Z was the cohort most opposed to cancel culture: 55 percent said they had a negative view of cancel culture, 8 percent were supportive of it, 18 percent were neutral, and 19 percent had no opinion. Moreover, it’s the youngest cohort within Gen Z—currently ages 13 to 16—who are most opposed to cancel culture, with 59 percent having a negative view of it. That number falls to 48 percent for the oldest cohort within Gen Z—ages 21 through 24.

Also: the poll again showed that Gen Z has higher approval of socialism that capitalism.  Not surprising given that they have grown up in an era of never ending bailouts, rampant cronyism, and Federal Reserve policy that favors asset owners who are generally older over asset buyers who are generally younger.  

Financial Repression Coming

Peter Schiff lays out the case for financial repression--interest rates below inflation rates--in a blog post at SchiffGold.  

The fact is that given all of the debt the US economy can’t handle the high interest rate environment necessary to tame rising prices. The Federal Reserve boosted interest rates modestly to 2.5% in 2018 and all hell broke loose. The stock market crashed, and the Fed was forced back to loose monetary policy even before the coronavirus pandemic. As Schiff noted in a podcast, if the economy couldn’t handle higher rates in 2018, it certainly can’t handle them today.

The level of debt is so much greater than it was then. And so, the more debt you have, the lower interest rate is required to be able to service that debt. So, if two-and-a-half percent was too much when the national debt was significantly lower than it is today, then that threshold is much lower. I don’t even think we could survive a move to one percent from the Fed.”

It seems almost certain the massive budget deficits will continue into the foreseeable future. That means the government will need to continue borrowing and it will need the central bank to keep its thumb on the bond market to make that possible. That means no tightening.

Financial repression is bad news for young people trying to save and accumulate assets.  Millenials and GenZers wealth is far below that of the Boomers and older generations at the same age.  Financial repression is going to make it even harder for young people to build nest eggs as inflation eats up their savings.    

Bidenomics Explained

 It's really not that complex.  Just substitute Biden for Corbyn and it all makes sense.

Losing the Trust of the People You Need Most

For a long time I have been blogging about how the loss of faith in our institutions is the biggest threat to the American nation.  This is a problem for young people in part because it is only people that believe in America that are going to invest in America.  I use "invest" not in terms of $$$s but investing their lives for the betterment of the country--police, military, firefighters, dedicated public servants, entrepreneurs, volunteers, etc.  If none of us invest ourselves, American becomes hollowed out.

A brilliant essay by Darryl Cooper (a/k/a) lays out how the FBI and the corporate media have abused the trust of Trump supporters.  This is a dagger at the heart of our country because these are precisely the same  people that are the ones that invest their lives in America.  As Cooper puts it:

It's hard to describe to people on the left (who are used to thinking of gov't as a conspiracy... Watergate, COINTELPRO, WMD, etc) how shocking & disillusioning this was for people who encourage their sons to enlist in the Army, and hate ppl who don't stand for the Anthem. 13/x 
They could have managed the shock if it only involved the government. But the behavior of the corporate press is really what radicalized them. They hate journalists more than they hate any politician or gov't official, because they feel most betrayed by them. 14/x 
The idea that the press is driven by ratings/sensationalism became untenable. If that were true, they'd be all over the Epstein story. The corporate press is the propaganda arm of the Regime they now see in outline. Nothing anyone says will ever make them unsee that, period. 15/x 
This is profoundly disorienting. Many of them don't know for certain whether ballots were faked in November 2020, but they know for absolute certain that the press, the FBI, etc would lie to them if there was. They have every reason to believe that, and it's probably true. 16/x 

Millions are and will continue to ask whether this is the types of country that they will invest themselves in or encourage their children to do so.  Brennan, Clapper, Comey, Corporate Media, Big Tech etc. have done tremendous harm to this country by sowing distrust and outright lies.  The losers of course are young people who will increasingly live in a country that fewer and fewer are are willing to invest themselves in.   

America's Slide Towards Socialism

 New poll by Axios (here and here) finds that Americans are more accepting of socialism than ever.  

But, young adults’ perceptions of capitalism have been the real driver of topline change in the past two years. Today, 18-34 year-olds are almost evenly split between those who view capitalism positively and those who view it negatively (49% vs. 46%). Two years ago, that margin was a gaping 20 points (58% vs. 38%). By contrast, views among adults ages 35 and older haven’t budged, with wide margins of 35-64 year-olds and 65+ saying they view capitalism in a positive light. 

Among adults in Gen Z (ages 18-24), perceptions of capitalism are truly underwater: 42% have a positive view and 54% have a negative view. 

 Approval of capitalism is falling even among young people that identify as Republicans.  

And more specifically, young Republicans have seen real movement in the past two years: in 2019, 81% of Republicans and GOP leaners age 18-34 had a positive view of capitalism; today, that number has fallen to 66%. Among Republicans 35 and older, views haven’t shifted as substantially.

More at Jonathan Turley's blog who makes the very insightful comment about the role of the education system in turning young people against capitalism:

The shift in favor of socialism is no surprise for some of us. My kids were often given material and lessons in their public high schools that criticized capitalism while rarely pointing out the failures of socialist countries like Venezuela.

Indeed, Venezuela continues to receive support despite a blood-soaked regime that has destroyed free press and free speech rights as well as reducing the country into an economic basket case. Recently, the Democratic Socialists of America (which claims supporters in Congress) visited Venezuelan dictator, Nicolas Maduro.  Previously, we discussed the delegation of Chicago Teachers visiting the country and showering it with praise as political prisoners languished in the jails of Maduro.

The pandemic has led to a massive increase in government spending which is also likely to shape the views of many on the benefits of government controls and centralized programs.  These polls show a generation coming to age that is ready to embrace aspects of Marx’s Das Kapital over Smith’s Wealth of Nations.

 

 

Just 36% of Young People are Proud to Be American

 Disheartening but not unexpected news from a new Issues and Insights poll of Americans.  Just over a third of 18-24 year-olds say that they are very or extremely proud to be American.  That compares to 68 percent for the country as a whole.   

So, which is the one – and only one – demographic group in the I&I/TIPP poll that is not proud to be American? It’s young people age 18 to 24.

The poll found that only 36% of this group say they are very or extremely proud, making it the sole demographic group tracked among whom pride falls below 50%. The poll found an almost identical share of the 18-24 crowd (35%) say that they are only slightly or not proud at all to be an American.

Is this youthful rebellion? The result of years of indoctrination by a leftist education system? Is it due to the young’s susceptibility to the siren song of socialism?  Whatever the case, this strong anti-American sentiment appears to dissipate with age.

Pride in America rises to 59% for those 25-44; 75% for those 45-64; and 86% for those 65 and over.  

Still, the findings are worrisome, and they are a reminder of Ronald Reagan’s observation that: 

Freedom is never more than one generation away from extinction. We didn’t pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same, or one day we will spend our sunset years telling our children and our children’s children what it was once like in the United States where men were free.

An upside is that 25-44 year olds are much more proud of this country than 18-24 year olds.  Perhaps this reflects that the further one gets from the left-wing indoctrination of the American education system the better one feels about our country.   

Liberals too are less proud of this country than conservatives.  That's a shame as liberals are the ones in charge of most American institutions--academia, K-12 education, administrative government, Hollywood and the culture.  As a result, our country is being run by people who really don't like it very much.  That's a problem.    

Inflation Concerns Cut Across All Generations

Those of us that experienced the 1970s and 1980s know the costs of inflation well.  Inflation makes it more difficult and risky to save and plan for the future.  It also creates a sense, rightly or wrongly, that one's earnings fail to keep up.

Now we are seeing inflation rates that are like that in the 1970s.  All Americans, especially young people, are rightly concerned.  

According to a Harvard/Harris Poll most young people correctly view excessive government spending and Federal Reserve money printing as the reason for inflation:

    Q: Are you concerned about increased inflation?
    18-34 Very/Somewhat Concerned: 87%
    All: Very/Somewhat Concerned: 88%

     Q: Are you concerned or not concerned that spending an extra $5 trillion dollars for the Biden infrastructure and families plan will lead to ...
   (18-34 only)

    Higher taxes down the line:  81%

    Runaway inflation: 78%

    Economic uncertainty: 79%

    Lower economic growth: 76%

    Negative impact on your finances: 76%

Young people are rightly concerned about all of these things.  More spending will mean higher taxes and higher rates of inflation (as government prints money to pay for these things).  Ditto on economic growth and impact on one's finances.    

Standing up for free speech

Miss New Jersey contestant lays out the case for free speech and against cancel culture.  Brave and inspiring.  Read about it here.  

Miss Northern Highlands Justine Murray went off on campus censorship on stage at the Miss New Jersey pageant:

“Our generation is experiencing an epidemic of censorship and entitlement. And it’s because our professors and our celebrities are teaching students to be narcissists, to believe that any of you that differs from their own is an existential threat,” she said in a video posted to Twitter of the competition.

“And this is what I experienced on my own campus with censorship to the point where people believe that speech is violence so that they can threaten other people with violence, simply because they disagree with them.”

—

“It is listed first under the Bill of Rights for a reason. Without it, all other liberties crumble. But today, we’re watching free speech get hammered to the ground by the very institutions that are supposed to promote diversity of thoughts,” she said.

“The mere words ‘I’m offended’ are now being used as an excuse to silence students, fire professors and cancel people simply because they do not know the popular line of thought,” she continued.

Well put.

Millenials Shifting to the GOP

Author Ryan Girdusky has crunched numbers on millennial voting patterns.  He documents a shift of millennial voters to the Republican Party.  The biggest shifts have been in the Midwest--a battleground area in national and state elections.

Here's an interview with Ryan by The Hill

This is very good news for lovers of freedom and economic opportunity.  

 

Young Swiss Reject Climate Taxes, Regulation

 Voters in Switzerland rejected three referendums that would have limited CO2 placed new taxes on motor fuel and airline tickets.  This was all part of a plan under the Paris Climate Agreement.  Other referenda would have banned the use of pesticides and chemicals in farming setting back one of mankind's great technological advanced.   BBC reports: 

Switzerland's policy on fighting climate change has been thrown into doubt after voters rejected key measures in a popular vote.

A referendum saw voters narrowly reject the government's plans for a car fuel levy and a tax on air tickets.

The measures were designed to help Switzerland meet targets under the Paris Agreement on climate change.

Many voters appear to have worried about the impact on the economy as the country tries to recover from Covid-19. 

The referenda drew particularly strong opposition from young voters who rejected the measures in overwhelming numbers.  

One reason the vote failed was lack of agreement among climate activists. Many rejected it because the law did not go far enough. But what is particularly interesting about this referendum is that the strongest opposition came from young people. 60-70% of the 18-34 year old voted No in the three categories.

 Perhaps this is a sign that younger voters are starting to reject the heavy-handed, top down approach to climate issues so favored by the ruling classes in the EU and United States.   

More here

A downside of remote work for young people: missed promotions

Bloomberg reports that lots of millennials are fed up with 100% work from home.

While experienced employees often have established professional networks and dedicated home offices, younger staff say the pandemic has left them under-informed and cut off from their teams. There are now growing concerns that they are missing out on career opportunities older colleagues took for granted.

Well over half of staff aged 21-30 stressed the importance of being able to meet and work with colleagues in person again, according to a 6,000-person survey carried out for Sharp Europe, a part of Sharp Corp., results of which were shared with Bloomberg. Nearly 60% said working in a modern, collegiate office environment has become more important to them over the past year.

I've been blogging about how the lockdowns harmed the careers and mental health of young people. The shift to work at home may be great for older workers who have connections in the workplace. Young people may find work at home enjoyable in the short term but not so pleasant in the longer term.

Get Ready for a Decade of Financial Repression

There's some interesting data in the new Biden Budget.  The budget assumes that inflation will be between 2.1 and 2.3 percent from 2022 to 2031.  That will be above both short and long term interest rates.  That means investors can expect a negative return on low risk assets--things such as bank deposit account and CDs--for the next decade.  The chart below is an excerpt from the economic assumptions section of the Biden budget.

Financial repression--setting interest rates below the rate of inflation--will devastate small savers.  This includes poor and middle income Americans.  It will also hurt young people trying to accumulate wealth for the purchase of a home and the elderly who are generally more likely to favor low risk assets.   

Financial repression also contributes to the growth of inequality.  Wealthy individuals and the large banks have greater ability to take risk or to engage in sophisticated investment strategies that will yield higher returns.  Poor and middle class Americans as well as smaller bank and financial institutions have less ability to bear risk.  

This is further evidence that young Americans are and will face a far more difficult investing environment that previous generations did.

Gen Z: Staying Afloat with Credit Cards

 Young Americans were particularly hard hit by the lockdowns and by the slower than expected recovery from the pandemic.  Given the combination of the twin shocks of the Global Financial Crisis and the COVID pandemic, it is not surprising that Millenials and Gen-Zers have had a harder time building wealth than previous generations as seen in the cart below.  

 

How the Fed Contributes to Generational Inequality

Stanley Druckenmiller lays out how the Federal Reserve's asset purchases are increasing inequality in America.  These asset purchases raise the price of financial assets.  That benefits the holders but does little for those who don't own stocks.   

Though framed in terms of the rich versus everyone else, Fed policy also increases inequality between the generations.  Older generations have had time to build up their holdings of stocks and other financial assets.  Their portfolios have benefitted form the run up of non-stop Fed simulative policies for the past thirteen years (low rates, massive asset purchases).  Younger generations are the losers.  Young savers and investors are confronted with having to buy into a massive asset bubble with inflated asset prices for everything--homes, stocks, bonds etc.--or to save with negative real interest rates.  

As I have blogged before, the current investing environment is one of the worst for young people in the past 40 years.  A big part of that is the never-ending stimulus of Fed programs. 

Millennials are Not Going to Get Rich Thanks to "Bernie Sanders' Policies

Investment giant Charlie Munger tell it like it is at the Berkshire Hathaway annual meeting. 

However, instead of offering some support to these newly-hatched capitalists who dream of achieving Buffett's success, however on a far more truncated timeframe, Charlie Munger had some stark words of discouragement when it comes to the next generation seeking to master the stock market.

“Bernie Sanders has basically won," the 97-year old said. "He did it by accident, but he won."

Munger then followed up with a sad truth which the largest US generation will hate to hear: "the millennial generation is going to have a hell of a time getting rich compared to our generation" the billionaire said, referring to its engagement with the stock market, where for now at least, millennials appear to be winning but Munger is confident that it will all end in tears.