I read a very disturbing article this week about a “Lost Generation” of American children. It sounds quite chilling, as if some macabre science fiction movie were being released about alien abductions and zombies gone wild. The reality is actually much scarier than any Hollywood thriller. Richard Freeman, a Harvard economist, coined this phrase to describe the growing number of recent college graduates who have entered the workforce since this great economic downturn only to find themselves underemployed, unemployed, still at home and more likely to be in poverty than at any time since World War II.
It gets worse. Today’s young people are continuing to delay marriage and purchasing homes, the bedrock of starting a life together. They are more prone to have children out of wedlock for reasons that escape me since fully 20% of them live in poverty. For this ever growing number of 20-somethings, the dream is fast becoming a nightmare. The promise of a meaningful career based upon a college degree has faded but their debt has not. Never before have the cost of education, and the subsequent debt that accrues, been more onerous and the prospect of obtaining relevant employment been more distant. The debt to opportunity ratio is approaching zero as wave after wave of young graduates come ashore each May.
For them, their fortunes have reversed. The stereotypical way of paying for tuition was to get a job as a waitress or barista. Now the young graduate is just as likely to be settling for such a job after graduation in order to pay off the college loan. Employment among those 16-29 is a mere 55.3 percent; teenage employment is only a startling 30 percent.
If this were a short term thing, a normal business downturn, it would be an insignificant blip on the radar. Instead, this protracted poor performing economy is likely to forever alter the job prospects of these graduate classes on the shoreline. Some will settle to be forever underemployed or sidetracked from their careers by their own choice. Others still will find themselves edged out by the fresher graduates several years down the road. Imagine the questions that employers will ask: how did you allow yourself to take your degree in sociology and parlay that into a gig at Starbucks? Hiring managers have short memories and unshared experiences.
Already, the calculus of the hiring equation is askew. The longer this downturn persists, the lower starting salaries will become and the slower will be the accumulation of wealth. It will take longer for couples to scrape together the down payment for their first home. Families will be smaller. Worse yet, expectations will be forever diminished.
In short, those of Generation Y will likely have a better chance of living the American Dream by daydreaming about it in the comfy confines of their parents’ home than by seeking to make their own way in the world.
There is another twist to the equation. The number of immigrants- legal immigrants- in this country continues to increase. So does the number of illegals. In any case, the majority are unskilled. Let’s put aside the debate of whether or not their presence takes jobs away from Americans. The fact is that a bad economy is an equal opportunity squelcher of unrealized expectation. If our native born population cannot find work, those who cross the border in any manner will only add to the misery of those struggling to find meaningful work.
The true irony is that there exist in this country more than 2 million job openings that cannot be filled because of a growing mismatch of skill-sets versus opportunities as our educational system is not producing the correct mix of graduates for the workforce and our immigration policies favor the unskilled over the skilled.
There is work to be done in Washington. Just this week there is news about unscrupulous government spending: $600 million in Social Security paid to dead people; $500 million paid to SOLYDRA even though the Obama administration knew the company was hemorrhaging cash; $107 million in tax credits to a leading Missouri Obama fundraiser; and surely others too heinous to mention.
It is not about Left vs. Right. It is about right vs. wrong. Government can be the solution to our problem only if government stands aside. Please, you’ve done enough to help. In one respect, President Obama was correct in pointing out that many of the proposed remedies in his jobs program have been supported at one time or another by each party but throwing spaghetti against the wall to see what sticks is not a solution.
Here is your solution: reform the tax code, focus regulatory burdens on safety and shared national interest, cut the growth in government spending and borrow less money. The economy will rebound and the revenues will increase to fund whatever society we wish to create.
In the meantime, there is a Lost Generation of Americans depending upon action in Washington, my children included. They are looking for leadership in Washington. Does anybody have the courage to lead?