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🌊 The Mortgaging of Gen Z’s Future
As the debt grows, the youth will have to pay it off
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By Max Frost
We Maxes, age 30 and 28, straddle the Gen Z-millennial divide. We founded RocaNews to provide a fresh take on the news for this generation. That compels us to write this piece on how today’s politicians are mortgaging the future of our generation and many to come.
We don’t view this as opinion, because we don’t see a way around the cold, hard facts. Read below and feel free to disagree. If you do, please let us know why.
Our parents – Boomer and Gen X – have pointed out for decades that we need to save and invest our money to take advantage of compounding interest. A dollar spent today is a dollar plus interest you won’t have in the future. Our politicians have neglected this advice, and one day, we’ll pay for it. To understand how, let’s take a quick trip through time.
It’s 1980: The median US home price is around $65,000, and the average cost of a four-year college education is $9,438. The average annual tuition at a public, four-year university is $804 – around 6% of the then-average salary of $12,513. It’s the peak of the Cold War, but the US national debt is “just” $890B, equating to $4,048 per US citizen.
Now it’s 1990: The Cold War ends and the world enters a period of dramatic economic growth, which President George H. W. Bush labels the “peace dividend.” The tech sector booms as free-market policies seem to be on an unstoppable ascent. Among various moves, President Clinton signs NAFTA (1992) and deregulates the banking sector (1999).
Yet despite the boom, the debt explodes: In 1988, it’s $2.6T; in 1991, $3.6T; in 1999, $5.7T.
Those were economically strong years, but the US spent like crazy. Then, actual crises begin to hit. What does the government do? Spend more.
The spending blowout continues from 9/11 through 2007, when the federal debt reaches $9T. During the Great Recession, it increases by more than $1T each year. By 2016, it reaches $20T.
And it keeps climbing!
To $23T in 2019…$27T in 2020…$28T in 2021…and $31T in 2022…and $35T in 2024.
Finally, we reach 2025: The average home price is $416,900, and the national debt is $37T, equating to $108,000 per US citizen. Compared to 1980, the US population has grown by 55%, but the number of manufacturing jobs – a proxy for work that doesn’t require a college degree – has declined by 35%. So most high-paying jobs now require a degree, but those cost between $100,000 (in-state, public) and $300,000 (elite, private).
On the one hand, median salaries are higher than they have ever been, and consumer goods, often built in cheap foreign factories, are more affordable than ever. But perhaps the three most important costs – healthcare, housing, and education – have vastly outpaced inflation and salary growth.
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Editor’s Note
In our extensive travels across this country over the last year, we’ve developed a greater interest in and fondness for the US than we ever had before. The amount of good-spirited, hard-working people never ceases to amaze us. That being said, we’ve also seen a lot of pessimism and hardship, especially among younger people. Today’s story sought to explain some of why that’s the case. Thanks for reading. As always, we love to hear from you, so send in your thoughts on today’s article here.
Tons of responses to yesterday’s story on Dollar General. If you missed it, you can read it here free. Now, to those replies.
AJ wrote:
I was very excited to see the title today! When I lived in missouri, I built dollar generals from 2011-2014 . We traveled from Colorado to west Virginia. Built them everywhere. Dollar general started there expansion during the economy slowdown. And they purposely targeted walmart more than mom and pop stores. If they knew people had to drive 20-30 minutes to Walmart , then boom they put one in so they only had 5 minutes. We put some in some very remote places that the locals were very happy to get one. We just got a new one by us a few years ago. 15 minutes to Walmart so we use it if we need a jug of milk or something. Still do all our other shopping at Publix or Walmart but its handy for essentials. Back when when I built them they were notorious for being cheap. Like penny pinching. And now the new stores have things like motion sensors at the front door that dim the lights in the store if they dont sense movement in 5 minutes. So if your in there shopping and then the lights dim , the manager will be at the front door jumping up and down to get the lights back on!
Emma wrote:
Is this not just uncontrolled capitalism? Whoever can provide a better service for cheaper will survive.
Perhaps you've just found it shocking because you've suddenly connected it to real people's small businesses going under?
Maria wrote:
It’s the problem. Soon, the country will be run by only a few corporations as giant companies continue to buy out smaller ones, just as Dollar General continue to grow and push out small businesses. I feel like I’m watching the opening scenes to a post-apocalyptic movie. It won’t be long before the U.S. will be run by 3 or 4 huge corporations. It’s frightening.
And Katrina wrote:
I live in a very rural area of SW Colorado. We have a Dollar General in a small town about 15 miles from my home. It is definitely a plus for the area. The store is very clean and well maintained by the staff. The employees are extremely helpful and always nicce. Everyone is greeted with a smile. The prices are so good compared to most chain stores . If they would just add a few fresh veggies and fruit, I would never have to drive 55 miles to get groceries .
And in case you’ve missed our other latest reports, find them below:
See you tomorrow,
Max and Max