Why You Should Be Gravely Concerned About the Old-Young Wealth Gap in the US

"You can't get a grip if there's nothing to hold."
~MGMT, from "Flash Delirium"

What is the wealth gap between younger and older Americans, and what does this situation portend for the future?

The Associated Press' Hope Yen reported Monday that the wealth gap between the young and the old in the US is the highest it has ever been on record. The wealth gap between younger and older Americans has been "worsened by a prolonged economic downturn that has wiped out job opportunities for young adults and saddled them with housing and college debt".

Yen: "The typical US household headed by a person age 65 or older has a net worth 47 times greater than a household headed by someone under 35, according to analysis of census date released Monday." Thus, the wealth gap between older and younger Americans today is more than double what it was in 2005 "and nearly five times the 10-to-1 disparity a quarter-century ago, after adjusting for inflation".

The Great Recession has hit American young adults particularly hard in recent years. Where many young Americans have been saddled with excessive student loan debt while struggling to find employment, it should be no surprise that young Americans are beginning to speak up and have their voice heard regarding this sociologial quagmire. Yen: "Complaints about wealth inequality, high unemployment and student debt also have been front and center at Occupy Wall Street protests around the country."

While all age groups are facing an increase in wealth inequality, for younger Americans in particular delayed marriages, increases in single parenting, the housing bust, and the recession have made life difficult. Where the elderly have a safety that many young adults may lack, labor economist and professor Harry Holzer commented, "It makes us wonder whether the extraordinary amount of resources we spend on retirees and their health care should be at least partially reallocated to those who are hurting worse than them."

The widening wealth gap between older and younger Americans should come as an ominous sign for many Americans. Akin to Franz Kafka's Metamorphosis, it would seem that younger Americans have been left to fend for themselves like lonely beetles-in-bedrooms amidst a depressing financial crisis in a cold, hopeless universe. I am sure for many young Americans life is quite Kafkaesque right now. As such, I think the widening wealth gap between old and young could very well mean bad economic karma for older generations in the years to come.

Some individuals commenting on the AP's old-young wealth-gap article published on CNBC suggested that older generations are being selfish in reaping substantial benefits while younger generations will get their revenge on older generations when the time comes -- in particular, in terms of care for the elderly, benefits, and subsistence. However, some commented that young Americans are lazy and think that they are entitled to everything, so the street goes both ways. And when all is said and done, many in the US are struggling financially in all age groups; even in light of the old-young wealth gap, where some young adults may be well-off today, many elderly may be starving with no money to pay the heating, electricity, and water bills. The street goes both ways. Nonetheless, when it comes to the wealth gap between older and young Americans, I believe there is a sense of economic karma in play.

Some commentators would like you to believe that many in Generation Y are merely whiners and thus Generation Y is the so-called "entitlement generation". I would pay no attention to the critics cynically labeling all of Generation Y the entitlement generation; I personally think that the idea of Generation Y being an entitlement generation is simply red herring. Red herring for what, you may ask?

Cynically labeling Generation Y the entitlement generation is red herring for the fact that older generations are not retiring thereby flooding the workforce, distorting the labor market, and effectively not allowing younger adults to make the rite of passage from graduation into a career. Cynically calling Generation Y the entitlement generation is also red herring for the fact that most members of Generation Y have been roped into society-wide Ponzi/pyramid-schemesque regimes of higher education and Social Security.

I can recall after I graduated college, I was able to secure only a mindless, low-paying, meaningless job in retail; I couldn't stand it, but it was the only job I could find at the time; to say the least, it was not the ideal job. Nevertheless, even then I was grateful for at least having a job. As I learned from my own experience, it does no good to blame oneself for society-wide financial crises. Many young Americans may be tempted to blame themselves for having to work in wage slavery or for having to live in their parents' basement or for having to be romantically lonely with no career path, but I would encourage them to not blame themselves and to not lose hope and to continue working hard for what they want out of life.

There may very well be some young Americans out there who feel betrayed by virtue of getting their Bachelor's degrees only to find that the only available careers were in fast food, retail, and the military. There may very well be some young Americans who feel that older generations are willfully attempting to corral young adults into alienating, meaningless, brainless, wage slavery jobs as older Americans refuse to retire and pass the occupational torch to younger generations. There may very well be some young Americans that are having to resort to taking antidepressants to deal with a perceivably hopeless existence on an overpopulated planet where both career and romance are out of financial reach.

All the aforementioned issues and more play into what appears to be a growing societal angst among younger Americans; I believe the prominence and viability of the Occupy Wall Street movement is a testament to this. As such, all age groups in the US would do well to consider the future in light of the current wealth gap. As this societal angst in American young adults festers through the years, it will be interesting to see how it evolves and translates into policy in the near the future. Young Americans' societal angst has to go somewhere.

Into what could that festering angst and resentment in American young adults (over being corralled into wage slavery, being effectively denied a respectable, meaningful, humanistic career creating a product, having a worse status than the previous generation, and being saddled with debt owing to various social conventions that have not paid off) translate in the future of American society? Such thoughts are indeed precarious.

In the future, if a widening wealth gap between older and younger Americans festers into widespread generational resentment and frustrated angst, the result could give way to overt violence and harassment towards the elderly in the future. Unfortunately, in some ways we are seeing this already. Fox News reported on Nov. 7 that Occupy DC protesters assaulted conservatives and even pushed an elderly woman down the stairs. The 78-year-old woman suffered multiple injuries, including a bloody nose, cuts, and large bruises. The Drudge Report also recently had a story about youths beating up an elderly gentleman for no apparent reason in Philadelphia; the young men did not even take the elderly victim's keys, cellphone, or wallet. There is a good chance that if societal resentment and angst grow owing to perceived income inequality based on age differences, violence and harassment against the elderly could increase.

Given the emergence of Obamacare, one has to wonder what the future of health care for the elderly in America will be. While conservatives criticized Obamacare in that the government would be setting up supposed "death panels" to determine health care for individuals, if societal resentment and angst based on age differences persist, Americans' attitudes towards the elderly with respect to health care could change -- and not for the better -- in order to cut costs, limit spending, and preserve funds. Where the middle-aged Americans of the future in a few decades are caught between feeding their elderly parents and feeding their own children, the dilemma could spell doom for the older generations of today.

The issue of health care for the elderly brings to mind an important crux with respect to a widening wealth gap between the old and the young. As older generations retain relative wealth while younger generation struggle to establish themselves, support their families, and feed their children, could Americans' attitudes towards euthanasia change in the decades to come? And if so, what would the legalization of euthanasia portend for the older generations of today? Such a deep concept could not be sufficiently explored in this article, but given the stark generational differences of wealth in American society, perhaps some elderly Americans in the future would be willing to sacrifice themselves for the benefit of their children and their grandchildren.

Given the course of American society and changing social attitudes, I could see older baby boomers in the future (perhaps those one day suffering from terminal cancer) seeking out euthanasia as a way to preserve funds that would pass to younger generations by will or probate -- thereby passing wealth on to the younger generations by way of sacrifice -- ensuring the survival of the future generation.

While euthanasia may be a sensitive and macabre issue, for me this brings to mind the issue of smoking cigarettes. As life expectancies have risen, one has to wonder if the popularity of smoking was some subtle form of biological "parental intuition" courtesy of the so-called "Greatest Generation" (and previous generations as well) to prevent younger generations from having to be weighed down in taking care of older generations while trying to also raise future generations. This would be akin to the "parental intuition" of the Greatest Generation that the phenomenon of rock 'n roll in the 50's and early 60's would evolve into something relatively dysfunctional and ugly with drug use, societal dysfunctionality, and the collapse of the common norms of societal morality. One has to wonder.

Of course, if Americans are reluctant to legalize euthanasia and the number of nursing homes increase, there is always the possibility of tent cities for the elderly in the future. As I have written previously: "On the topic of retirement, if many Gen-X and Gen-Y Americans find themselves unemployed (and unemployable) going into the future, unable to buy homes, get married, or have children, how will the younger generations be able to take care of the elderly generation of the future? Where will the funds come from? Where will the money to pay the health care costs come from? I mean, seriously, what, are we going to have tent cities set up for...elderly citizens in the future? ...If echo boomers are not able to walk on their own now as grown adults of productive age, how will they be able to walk in the future carrying the elderly generation on their back?"

In this way, although more nursing homes could be constructed in the future, given the dire economic situation in which we find ourselves, one has to wonder if tent cities for the elderly are in America's future. Tent cities used as nursing homes may sound a bit far-fetched, but it's probably closer to reality than we would care to entertain at present.

Either way, the key here comes down to job creation, hard work, and a bit of patience. Or in more spiritual language: faith, hope, and love. If young adults can persist at least until the current financial crisis is a thing of the past, perhaps the future will be bright. If resentment and angst in young adults fester over time, then we have to be realistic about the implications for American society as a whole going into the future. That resentment and angst in contemporary American young adults will have to go somewhere. To say the least, there is a sense of economic karma at work here. Just something to keep in mind.