All our lives, we Boomers heard how we changed society. All our lives, we Boomers heard how much more difficult it was for our large bubble of population – getting into college, getting jobs, finding homes, etc. In 2014, we even hear how we who are over fifty are now causing the divorce rate to spike. But, looking at our generation today, our lives have been privileged. We grew up in the safest time in the history of the world, the 1950’s post war boom. We could walk to school and my brother and I even went alone to Manhattan on the subway while preteen age. Today, children cannot leave their homes unattended. We grew up in an economic boom time. The sky was the limit. Our only limitation was our large number. Yes, I think we have to thank “the greatest generation,” those who lived through the depression and World War II, for creating policies and being savers and leaving us with their savings, to still keep our Boomer lives privileged in retirement. Are we Boomers the last to experience the American Dream?
This Grandma hopes not. After all, as a grandma, I hope my grandchildren will have a better life than I have. Yes, I want more for them. Watching television and hearing about the environment, climate change, world unrest, and the impact on their lives gives me pause. Living through this recession and its lingering effects give me pause. Now, it seems, the future has limitations for our children and grandchildren that give me pause.
I am almost ready to stop reading the articles about this coming generation. Each one seems more depressing than the next. Then, reading the New York Times, Sunday, April 20 2014, I came upon an article, “Postponing the American Dream.” This Grandma can deal with delayed gratification, so I read on, even thought the initial blurb was off-putting, “How a Shortage of Young, Willing Home Buyers is Holding Back the Economy.” Are we now blaming the coming generation for holding back the economy when the economy is the reason they are being held back?
Okay, the article does mention the housing bubble, banks not lending, builders who quit building, but what hits me the most is the missing buyers and missing households which is what the article is mostly about. In our twenties, we Boomers were creating households and buying our first homes.
The author, Neil Irwin, explains:
“Household formation,” as economists call it, is the foundation of demand in the housing market. When a young adult moves away from home and gets her own apartment, a household is formed; when a retiree moves out of his own place and into the apartment above the adult child’s garage, one ceases to exist. The number of American households is in constant motion; it is determined by millions of individual decisions that Americans make about their living situations. Since 2007, those decisions have tilted overwhelmingly toward not dividing up into as many households as in the past. . . . .Trulia estimates that by last year there were 2.3 million of those “missing” households –households that would exist if historical patterns had held, but instead are nowhere to be found.
Mr. Irwin seems to point primarily to the fact that the recession has hit the 18 to 34 year olds hard and only 62.9 percent had jobs last month, down about 7 percent from the same time in 2007. And those who have a job do not seem to have a good enough job to afford to own a home. Student debt, needing a stronger down payment, and not wanting the hassle of a home are listed as reasons why home ownership is down. We Boomers are mentioned in the group that more and more does not want the hassle of home ownership. I remember how shocked I was to learn that home maintenance costs are annually significant in comparison of the cost of a home – how many of us Boomers were told that before we bought homes!
Rental units are increasing in number and, according to the article, “smaller rental apartments that generate less spillover benefits for the broader economy,” are contributing to us being stuck in a vicious cycle: A moribund housing market saps the economy of strengthh, and the ensuing weakness – high unemployment, slow wage growth – means that fewer people are leaving the nest for a home of their own. . . .How to get out of the cycle?
Through a grinding, gradual process of which the 2.3 million missing households start looking for their own places, which generates more building activity, which strengthens the economy and results in more jobs and higher wages.
What happened to the student loans and the lack of jobs and the lack of adequate jobs and the banks not lending money? REALLY. This Grandma wishes that there was such an easy answer to everything. At least the author recognizes some reality:
None of that, however, can happen instantly through some policy change, like a tweak in federal housing rules to make it easier to get a loan, or further measures from the Federal Reserve to lower mortgage rates. More than anything, it takes time.
The author concludes with a quote that says 2017 “is the year everybody throws out as when we’re back to normal. The person quoted says, “That still seems unbelievable to me.”
To me too. It seems that conventional wisdom is that the next presidential election is 2016 and, by some miracle, the new president is going to make it all better for the next generation, our children and our grandchildren.
Here the world goes again, ignoring the Boomer generation. The “experts” look at “historical patterns” forgetting we Boomers change history by our extraordinary numbers. We have the majority of the wealth in America. We are at the height of our professions. The housing market should be looking to build for us who are downsizing or moving to retirement locations to boost the economy for everyone!
In the meantime, we should be proactive for and with our own and those who mean much to us. Again, because of our numbers, we CAN effect change. We need to mentor and help those who mean much to us who have been hindered by the economy. We need to sponsor and promote and connect those who mean much to us. We need to advocate for what is important to us, whether it be dealing with climate change or the economy or some other cause. We have the biggest voice and now we must give the biggest hand. . . . and in some cases, handout, to our children and grandchildren, within our means and without jeopardizing our own future.
Knowing what that is and how and how much is a challenge. A long (we never say old) friend just stopped subsidizing his grandchildren’s schooling when he realizing the parents of the grandchildren were not moving forward and just relying on him. His reasons were twofold: his own future retirement had to be considered and his children’s lack of appreciation and motivation was becoming more detrimental to that family structure. They, like the economy, were moribund, and he felt he was making them weaker rather than stronger.
What a dilemna we Boomers are in! We are not our parents’ generation. We do not want to live above our children’s garages. We are active and young and want a life of our own–and to continue the privilege that we have come to expect. But we also want our children and our grandchildren to have the benefits of the American Dream.
Postponing the American dream for our children and grandchildren is okay if that is reality and we are only talking about postponement. This Grandma is not so sure. But 2017 is not far off. This Grandma can mentor and sponsor and promote change that will be beneficial for home ownership as a goal for those of the next generation who want that goal. The next generation, too, are older when they begin the so called “household formation.”
Yes, we Boomers have changed society as we have gone through our stages of life. I, for one, feel privileged. I hope our children and grandchildren will feel privileged to live in America and have the same opportunities as we did but I am concerned. Are we Boomers the last to experience the American dream? Think about it. I wish thinking about it brought me
Joy,
Mema
Comments