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London Futurists Message Board Books/Media For Futurists › David Willets - The Pinch: How the Baby boomers took their childrens future

David Willets - The Pinch: How the Baby boomers took their childrens future and why they should give it back.

A former member
Post #: 370
Currently/nearly finished reading this very interesting book. David Willets (AKA Two Brains) Tory MP has a different slant on what the future may bring. He thinks that the UK's Baby Boomers (born between 1947-1965) have been greedy robbing future generations of future and present wealth. (I think we discussed this/ similar subject at a meeting once) Add in of course that generations greatly increased life expentancy (74 years men 79 women) and you have a vast looming pensions crisis. He paints a pretty doom and gloom outlook as gen X has too small a population to support the millions who will soon be drawing their pensions.
The resulting breakdown of the intergenerational contract is causing mighty problems and threatens much worse. In one chapoeter on post war demographics he sets out how the baby boom and the roaring economy had a series of unexpected consequences. It was not the 60's but the surge in earlier marridges that set the explosion of family breakdowns in the 1970's and 80's. The boomers then converted a once off surge in asset prices into higher incomesby borrowing against them. So that despite the recession the young are shut out of the housing market. This is so true when you think about it its almost oimpossible for my generation (X) to get a house in london unless you have a salary of 50+K!! In one arresting insight - he observes that although we think of modern twenty somethings life as very fast, in fact their transition into adulthood is actully much slower held back by lack of affordable homes or secure jobs!
Sadly he doesnt really offer any solution on how to tackle these challenges, he just aknoledges the political and economic power of the boomers without offring a clear idea (so far) on how to persuade them to reach out to younger generations. But the urgency of them doing so comes across clearly in what i think is a pretty interesting/important book.

It will be at CAmden Lending libary in a couple of days if anyone wants to read it when i give it back!
London, GB
Post #: 65
The whole shebang is far worse than you think - back in 1799, income tax at 10% was introduced as an emergency short-term measure to fund the Napoleonic wars - but the Government realizing they were onto a good thing decided to keep it going, and every few years hike the rate up (the same way they do with petrol and booze taxes) till its reached its present level 400% higher than when it started.

Then, back in 1909, Prime Minister Lloyd-George introduced the Old Age Pensions Act, paying retired persons a weekly sum of money from the taxes of those currently working.

No doubt fantastic news for pensioners at the time, but effectively if you retired in 1909 (or shortly thereafter), you'd have worked all your life and kept the bulk of your earnings, then been delighted to find that the government wants to give you a free handout.

Meanwhile, a century later, numbskulls like you and me are paying stupid levels of Income tax plus 12% National insurance on anything we earn, followed by 17.5% on anything we spend (unless its petrol or booze etc., when its even higher)... All whilst present day Politicians are milking the system to give themselves inflation-busting raises, claiming back all their day-to-day living expenses, and saving everything they earn for their old age, all whilst wringing their hands, putting on a hair shirt, and telling us plebs that there's no money left in the coffers for when we get old and sick.

But I digress: I think it might a tad unfair to say the Boomers have robbed future generations, since you have no control over the generation you were born into. But, forward thinkers such as Jeremy J. Siegel, Timothy Leary and Alvin Toffler have all noted the issues of the Boomer generation coming to retirement age, at least as far back as the 1980's (if I recall correctly).

However, what I find really interesting is that someone due to retire around 2010 would have been born around 1945, which in turn means that they would have been 22 in 1967 (the so called Summer of love), and thus quite possibly one of the original Hippies (a movement that was only possible because of the economic boom of the 1960's).

Nothing amazing so far, but roll on 20 years to 1987 and all the Hippies have since become Yuppies preaching "Greed is good", and proclaiming Margaret Thatcher to be a Saint.

I don't have figures to hand, but I'm wondering if that very same generation is more likely to be the ones treating their property like an ATM, borrowing huge amounts of money from brain-dead Bankers, and then declaring bankruptcy to avoid paying it back.

As to solutions; Jeremy J. Siegel expects that as Boomers age, they will tend to move to retirement villages, thus increasing the supply of available property, which in tern would tend to lower house prices. Then, as Boomers start dieing, investments they have made will tend to be sold by younger generations, to help finance the cost of having a family, reducing debts or improving their standard of living etc., which in turn will tend to impede raises in stock market values (the thing your pension is dependant upon).

The upshot of this is the theory that one should avoid property investments, and instead invest in retirement facilities and geriatric healthcare, since these should be growth areas for the future.

These ideas might not be as crazy as they sound, since in recent years, Britain has developed a strange obsession with owning property, whilst much of the rest of Europe has been quite happy to rent.

So, while UK divorce rates have skyrocketed, immigration has been encouraged, and population growth allowed to spiral out of control in Britain - meaning more houses are needed - all while the government has restricted planning permissions, encouraged supermarkets etc. to hoard land, and cheered on house prices rising to levels about 30% higher than equivalent properties in other major European cities. This in turn encourages speculators to try to make a fast profit in a rising market (and further restricts supply).

However, now that the Pound is continuing to decline in value, Britain will be a less and less attractive place for immigrants, who will have since discovered that the wages they are earning today buys them less and less of their native currency, so they will at some point decide that they are better off returning home, along with many UK nationals who will realize that Britain really is broken and therefore they can have a much better life in some other country where they will pay less tax. Thus, this and the deaths of the Boomers will quite likely free up many homes, greatly increasing supply, deterring speculators and further exacerbating the decline in UK property prices.

The question therefore becomes is it worth sticking round to buy cheap UK property? Since we will have become a third world country in just a few years time...
A former member
Post #: 372
I dunno, Nothing i love more than to blame previous generations for thier mistakes! :) much easier than admitting to your own (like new labour).
London, GB
Post #: 67
An old priest lay dying in a London hospital, having served the capital's parishioners tirelessly for many years. He motioned for his nurse to come over.
"Yes, Father?" said the nurse.

"I would really like to see Gordon Brown and Alistair Darling before I die," whispered the priest.

"I'll see what I can do, Father", replied the nurse. So she sent the request to the Houses of Parliament, and soon word arrived back that Brown and Darling would be delighted to visit the priest.

As they drove to the hospital, Brown commented to Darling: "I don't know why the priest wants to see us, but it certainly will help our images and might aid the election campaign."

When they arrived at the priest's room, the priest took Brown's hand in his right hand and Darling's hand in his left. There was silence and a look of serenity on the old priest's face.

Finally, Brown spoke: "Father, of all the people you could have chosen, why did you choose us to be with you as you near the end?"

The old priest slowly replied: "I have always tried to model my life after our Lord and Savior Jesus Christ."

"Amen," said Brown. "Amen," said Darling.

The old priest continued: "He died between two lying thieves; I would like to do the same..."
A former member
Post #: 373
Dirk B.
user 9941666
London, GB
Post #: 52
The solution is simple.
Abolish age discrimination and retirement age.
No state pensions - replace with unemployment or sick benefit if the OAP can't get a job.
Right now there's whining aplenty about how we are short of skilled labour and having to import it. Meantime, people who would like to continue working are dumped because they hit an arbitrary age.
Oh... and push research into anti-aging tech and nootropics to let the OAPs compensate for any deterioration in mental faculties. Right now, I'm writing this while under the influence of modafinil. In the words of the tabloids, I'm high on a cocktail of mindbending drugs:-) Also doing a bit of Java MIDI programming for work. I mean, what else is there to do between Midnight and dawn?
A former member
Post #: 378
That modafil made me really violent! (no Joke) does'nt seem to agree with me at all. I tried it out at a Techno Festival recently and theres something about it that just doesn't work - i got very confused and agitated and had to stop taking it after the second day for fear of hurting myslef or others. Seems that some people's brain chemistry doesnt suit it - shame really because it seemed like a great thing to take to stay awake for days without drawbacks, I suppose not all notropic drugs suit all.

The answer I think is a revolution and mass culling of anybody over the age of 60 who is a owns more than two homes. These houses can be sold then to pay for the pensions crisis and the next generation as its a smaller group! biggrin

Seriously though we do need to be aware of these things over the next few years because I don't earn enough tax to pay for my parents pensions let alone the other 1.8 million boomers who are due to retire over the next 10 years. Makes me want to get into politics myself....
Dirk B.
user 9941666
London, GB
Post #: 54
Well, the constraints are obvious: more tax or less pension.
BTW, how much modafinil were you taking? The most I've ever done in a 36 hr period (my max duration before I hit the wall) is 600mg. BTW, are you sure it was modafinil?
Strange thing is, when I took it together with resveratrol I was sick for 24hrs like I had flu, so I don't do both together anymore.
Maybe it affects you more like a conventional amphetamine. I know when a friend of mine takes it she gets a bit "argumentative". Anyway, it's supposed to increase short term memory capacity, if you can avoid the fights :-).
London, GB
Post #: 71
Well, the constraints are obvious: more tax or less pension.

I can only surmise that you've either been taken in hook line and sinker by the Government's excluded-middle argument; or that you revel in ignorance and stupidity...

The possible answers to the problem are legion and more multifarious than committing political suicide by announcing "Everyone is getting a pension cut!", or simply whacking up taxes - whereby the rich move to sunny Belize or some similar area and pay less tax on their income, and middle income earners just negotiate to exchange money from their top tax bracket for perks that the Employer then offsets against corporate taxation.

What is the answer? Off the top of my head, (and just in case you really are a dimwit, I already figured out that some of these ideas would clash with each other):

So, how about we simply transfer resources from other areas? - the £3.2Bn per year we piss away on Europe's Common Agricultural Policy could be a good place to start...

How about just downsizing the Government? - India has a population many times the size of Britain, yet it has half as many MPs - and Economists tells us that the Indian economy has been growing at a phenomenal rate over the past few years and that this growth is predicted to continue long into the future.

How about simply extending the retirement age? - people would have longer to pay into their pension coffer, and are a few years closer to kicking the bucket when they eventually retire, both factors that should translate into a bigger annuity.

What about changing the Savings method? - If I pay into any pension scheme, the money is locked up till I hit at least 50. Therefore, if I hit 40 and find that I have a terminal illness, why can't I use the pension pot I'd never be able to claim to pay for my palliative care? As it stands, I'd have to pay into two separate schemes effectively costing me twice as much. Worse still, annuities connected to pensions are some of the worst investments one can make - but come retirement, the law says you must buy one - the only reason I can intuit for such whacky legislation is to stop pensioners spunking the lot on prostitutes, sex lines and speed boats, and then pleading poverty and asking for handouts.

Presumably, using a more Marxist tactic, the Government could legislate forcing all companies to use defined benefit pension schemes, rather than the currently popular defined contribution pension schemes.

Europe could be expanded to allow in countries like Turkey, who are relatively moderate Mohammedans, eager to join the Union, and full of young people, all of whom would then be paying taxes that would support our aging population.

I'm sure that given a little more thought, many many more potentially viable solutions could be dreamt up. But, unfortunately, brain power is something that seems to be in remarkably short supply amongst UK Politicians.
Dirk B.
user 9941666
London, GB
Post #: 55
None of your solutions will work for long.
Even the best, reducing government, depends on finding productive employment for the no-longer-govt employees. Otherwise, you simply "tax" former govt employees by reducing their pay to the level of unemployment benefits.

Transferring resources - not enough resources.

Changing the saving methods as you propose would actually reduce the amount in the pot for pensions.

Immigration won't work because we would need to import tens of millions of people. And keep doing it as that workforce got older.

I'm rather surprised you don't seem capable of thinking thinks through, even superficially. Or using google.
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