Last week, The New York Times ran an op-ed under the bylines of Emily Holzknecht and Binyamin Appelbaum.Holzknecht is a producer with Times Opinion Video. Appelbaum is the lead writer on economics and business for the Times editorial board. The piece, a highly produced video with a short introduction by the writers, is titled “How Boomers Blew Up the American Dream.”
The video is a collage of short comments by young Americans, strung together into a narrative storyline. The authors’ intro begins, “Hey, boomers! Younger Americans would like a word.” It concludes, “We have one simple request: How about an apology?”
The video collage, made up of several voices, begins:
Americans born in the decades after World War II were handed the world on a silver platter. Cheap college, cheap housing, abundant opportunity. The vast majority of you ended up wealthier than your parents, and Lord knows it wasn’t because you were smarter or worked harder. It was because America was an escalator. You just had to stand on it. You’ve been an electoral powerhouse since the ’80s. When presented with a choice between protecting your interests or investing in a better future for your children, you usually chose yourselves. More benefits for boomers, more tax cuts for boomers, and borrowed money to make up the difference … almost 30 trillion on the national credit card.
Nearly all of this is malarkey. It wasn’t “boomers” who destroyed the egalitarian postwar social contract. It was Ronald Reagan and the presidents who followed. Far from boomers cutting taxes for themselves and spiking the national debt, the reality is that taxes were cut mainly for the rich and the ratio of debt-to-GDP, which was over 120 percent of GDP at the end of World War II, came down to under 35 percent under Carter and then was pushed skyward again by Reagan. And the broad prosperity of the boomer era wasn’t just a matter of lucky generational timing. It was rooted in a different politics.
Holzknecht, who graduated from the CUNY Newmark Graduate School of Journalism in 2016, is in her early thirties. Appelbaum is in his mid-forties. By the conventions of generation-naming, that would make them millennial and Gen X, respectively. But as journalists, both are old enough to know better.
It’s a sign of how debased our political understanding has become that even two smart writers for the Times fall into the popular fallacy of looking at policies that affect life chances and the survival of the planet not through the lenses of class and power, but in terms of generational clichés. It’s even more appalling that the Times lead editorial writer on economics, no less, would look at generational averages rather than income and wealth dispersions.
In oligarchic America, there are a lot of filthy rich Gen Xers, while tens of millions of others struggle. And the millennial children of the top 1 percent are even richer. You don’t hear them complaining about generational injustice.
LET’S TAKE A CLOSER LOOK at the economic package that enabled many of my generation to lead materially fulfilling lives, why we got it, and what became of it. If the initials FDR are not part of your story, you are an economic illiterate.
The postwar boom was built on the regulated capitalism that pulled America out of the Great Depression (aka the New Deal), plus the added economic stimulus of World War II and then the Cold War. Thanks to strong unions and constraints on predatory industries, the economy grew more equal even as it grew at record rates. There was some lucky timing to the story, but that luck was built on an egalitarian politics.
What happened next was that capitalism became predatory again, thanks to shifting political power.
The economy is far richer on average than it was at the peak of the postwar boom. The difference is that close to 100 percent of the economic growth in the years since the financial collapse of 2008 has gone to the top 1 percent.
The Times might have unpacked the several elements of the good life that were available to the median (white) boomer, and asked where they went off the rails and what it would take to replicate them; it’s an interesting and complicated story, instead of an oversimplified and overproduced validation of the boomer myth that presumably got lots of cheap eyeballs among younger readers.
Consider the more equal income distribution of the boomer era. It was one part strong unions, one part well-regulated industries and capital markets, one part tax policy, one part increasing social insurance (both government and a corporate welfare state), and one part norms of fairness that were reflective of the politics of the era. None of it can accurately be understood generationally.
Much of that package could be restored with different policies. What’s tricky is that the industrial corporations of that era were oligopolies, largely insulated from cheap foreign competition; and the vast majority of workers had payroll jobs rather than gigs. Even so, that challenge could be addressed with different trade policies, and different labor policies removing the economic advantages that employers get from shifting payroll jobs to gigs. Different policies could also restore the effective right to organize and join unions.
Public universities could be free again if we just restored taxes on the filthy rich.
But the more that young people focus on supposed generational injustices rather than the real injustices of class and power, the less likely they are to embrace a politics that might make a real difference. That’s one reason why the generational myth is so convenient to elites, including, evidently, the Times.
One of the young people in the video complains that even public universities cost about four times what they did, adjusted for inflation, than when boomers were young. Fixing that is the easy part. Once, public universities were 100 percent tax-supported and tuition was free. They could be free again if we just restored taxes on the filthy rich. The culprit wasn’t “boomers”; the culprit was political conservatives of all ages.
Private universities are a more complicated story. As their model became more corporate, they kept raising tuition. Federal policy helped by promoting student loans without asking in return that universities keep tuitions within reasonable bounds. But even if private universities remain expensive, about 70 percent of all bachelor’s degrees are awarded by public ones. The number is much higher if we include community colleges, which are already free in some states and could be everywhere.
Good pensions were another part of the package that about half of the boomer generation received. Where did they go? In the 1980s, most corporations found it expedient to replace traditional good pensions with inadequate 401(k)s that shifted all of the risk to workers and retirees. As lifetime employment becomes rarer, that system would be hard to restore, but universal and portable pensions under Social Security could accomplish much the same thing. What it takes is a politics of taxing the oligarchy rather than kvetching about boomers.
The trickiest part of the story is housing. The New Deal restored the collapsed system of mortgage finance. The GI Bill helped with zero-down-payment mortgages. The interstate highway system helped turn farmland into suburbia. FHA worked with developers to promote construction of tract homes. Rent control left over from World War II helped keep rentals low. But as America ran out of cheap development land, housing became more expensive. And then housing became a hedge against inflation, pushing up housing prices further.
Homeowners who bought in early enjoyed windfall increases in net worth at the expense of their figurative and literal children and grandchildren. But this was not the consequence of boomer greed, but of circumstances and deliberate policies. NIMBYism adds to the problem, but NIMBYs come in all ages. Digital billionaires guarding their preserves tend to be young.
Here again, we could have a different set of policies. Government could be subsidizing construction of new homes, and of affordable rental housing. There are lessons from other countries. In Vienna, half of all rental housing is social and affordable. Middle-class families are eager to get into it. In Sweden, all development land is municipally owned, thus preventing speculators from bidding up prices. This makes both rental and owner-occupied housing less costly and more plentiful.
I vividly recall that when Michael Dukakis, a serious student of affordable housing, was the Democratic candidate for president in 1988, a running joke had it that his idea of light summer reading was a book on Swedish land use planning. Any nation that turns insights into affordable housing into a joke deserves what it gets. But I digress.
APPELBAUM COULD HAVE WRITTEN that complex explainer story. Maybe he still will. He knows the history at least as well as I do. In 2019, he published a terrific book titled The Economists’ Hour: False Prophets, Free Markets, and the Fracture of Society. In it he explained how most of the analysis and policy advice of mainstream economists had turned out to be wrong.
I sent him an admiring note, adding that one missing chapter might have addressed how and why the insights of dissenting economists like Joe Stiglitz turned out to be right, and the role of wealth and power leading them to be ignored, while chronic sources of bad advice like Larry Summers had far too much influence. Appelbaum sent back a nice note saying that he wished he had included such a chapter.
It is understandable that there is a lot of economic illiteracy among millennials and Gen Xers. They look around them and so many of the people they see with comfortable homes and secure retirements from stable careers are people in their sixties and seventies, with life courses seemingly not available to themselves. So they conclude that “the boomers took it all.” But those who took it all are not a generation but a class. With a different politics and a different set of policies, younger Americans could have what boomers had.
It is bad enough that this form of economic illiteracy serves the myopic tendency to excuse oligarchy. What is inexcusable is that The New York Times reinforces it. It isn’t that “boomers” owe future generations an apology. It’s that Appelbaum and Holzknecht owe Times readers an apology.