Growth and the Generational Divide

There is no large movement in the West which wants rid of the mantra and system of economic growth. Growth means a positive change in a nation’s Gross Domestic Product (GDP); if an economy made more goods and services over a given time, it grew.

Growth is put on a pedestal and religiously adhered to. If a society today isn’t getting at least 2% growth, it is underperforming; if it has no growth, it is stagnant; if it has negative growth, it’s in a recession/depression and needs urgent stimulus to heave itself above even again. The notion that we must keep making more things, and that not doing so equals dysfunction and hardship, goes almost unquestioned in modern times. Unfortunately most of the growth of recent decades has enriched only the top of society: precious little makes it to anybody who isn’t already wealthy.

A few years ago, the BBC did a profile on France narrated by Robert Peston, which featured the now-President Macron. It was balanced to the point where a pig farmer was featured who questioned growth (segment starts 25 mins in). To paraphrase, he says: “our lives are short, we should focus on being happy not work hard to satisfy an elite’s desire for endless growth in a finite world, or else we’ll destroy ourselves.”

Peston deems the farmer a ‘proud man of the left’, and immediately switches focus to the violent and vitriolic far-right. A peaceful remedy of wealth redistribution, an end to overwork and no authoritarian anger isn’t sexy enough for the 24/7 News! Disaster! Calamity! cycle of our time. Implications of urgency, violence and calamity exploit our primal instincts, but distract from the concept that the growth system underpinning economics is unsustainable and self-destructive.
Putting aside these distractions; in the West we’ve seen growth falter as wealth concentrates in fewer hands: inequality. Meanwhile there continues a steady increase in ecological disasters and extreme weather events, species extinction, pollution of the oceans and air, and waste on an obscene scale. There is no mechanism in our economics to deal with this – the side effects (in economics speak the negative externalities or tragedy of the commons) inherent to growth economics are evermore apparent.

Neither gross inequality or ecological damage is addressed by an obsession in growth. Mass migrations, as a consequence of one or both of these results, may lead to increased violence, xenophobia and war. Suddenly, the fixation upon making more goods and services appears to be single-minded, defective and – ultimately – self-defeating. The wealthy collectively hoarding trillions of dollars seems at best idiotic, or at worst outright insane. Yet this system is the orthodoxy of our time.

The second part of this post concerns the idea of a generational divide: economic and cultural conflicts between the young, ‘Millennial’ generation, and the older, postwar generation known as ‘Baby Boomers’ or simply ‘Boomers’.

Generational conflict has always existed. The old have always judged the young as being lazy, immoral, disrespecting or entitled. Conversely the young have always viewed the old as being outdated, overly cautious, set in their ways, and too trusting of authority. Yet this trite discussion has come to life recently. Why?
The Boomers were born and matured in a time of unprecedented wealth distribution – the postwar consensus ran from the late 1940s to the late 1970s. Healthcare, education and housing were provided by the state, and wages consistently rose. As adults, in general they subsequently voted for politicians promising even more prosperity through a shrinking of the state and a casting off of inefficiencies via the profit motive.

Over time these measures have mostly helped the richest through privatization, lower taxes and looser regulations on employment. Those who continue to vote in this ideology are generally older people thought insulated from the economic malaise, and/or set in their views. Further, the old are considered more prone to xenophobic ideology. All of this contributes to the notion of a generational divide, increasing resentment.

Yet this argument relies on stereotypes, and is flawed. Firstly, whole age groups are clumsily lumped together, even as vast numbers of both don’t fit the stereotypes. Secondly because it is misdirection: the root cause of the divide – defective ideology of recent decades – is relegated to the background. The debate is an embodiment of divide and rule, which acts as an obstacle for non-rich people to improve their fortunes. Inevitably criticisms get more heated; Boomers are characterized as sociopathic, the young characterized as living in an entitled, deluded bubble ensconced by modern technology. Somewhere a supervillain twiddles his fingers together, and cackles: “All is going to plan!”

Not all young are marginalized, not all Boomers are rich and selfish – more people across all age groups are finding life increasingly difficult. If the young and the old cannot agree on common ground, acknowledge one another’s grievances, and unite then they will continue to be misdirected and find their differences exploited by those who gain from such distraction.

At first glance, the issues described above seem different. Yet both are rooted in the deeply flawed economics of our era, and both are exacerbated by the status quo.