Millennials Can't Afford to Ignore Washington
The following is adapted from Disinherited: How Washington Is Betraying America’s Young (Encounter Books: May 12, 2015).
Tens of millions of Americans are between the ages of 18 and 30. These so-called millennials are, or soon will be, entering the workforce. Their situation is substantially worse than that of prior generations of Americans. It is not because they are less intelligent. It is not because they have worked less. It is not because they are any less deserving of the American dream. It is because Washington consciously made decisions that render their lives more difficult than those of their parents or grandparents.
Mary Parrilli, now in her 20s, living outside Chicago, told us: “I am outraged. We have been scammed, end of story. I do not expect to get back any of the money I am paying into Social Security—to me, it’s just another tax. I think people should help the elderly, especially their own family, but it is immoral for the government to force this upon us. This is a perfect example of punishing the young and successful, and rewarding the irresponsible.”
The explosive growth of programs that benefit the old at the expense of the young is only one aspect of the myriad government policies that disadvantage America’s younger generation. Not only are the young forced to pay for their parents’ health care and retirement benefits, but they also encounter an education system that bankrupts them and leaves them far behind their peers in other countries. When young people leave school, they face a hostile job market littered with government regulations.
Why do politicians refuse to respond to the mistreatment of so many young Americans? Why is it so difficult to alter the egregious policies that keep young people unemployed, uneducated, and liable for trillions of dollars in unfunded promises?
In Washington, D.C., and in state capitol buildings around the country, entrenched interests protect the old, who have had the time and resources to build up a powerful political apparatus. Washington politicians dare not take on the American Association of Retired Persons, one of the largest interest groups in the country, and change the unsustainable trajectory of entitlement programs. Rather than modify the benefit structure of Social Security to defend its solvency, the AARP chooses to protect generous benefits for today’s retirees and disregards the future.
To accomplish this, the AARP deploys its vast lobbying machine. The organization spent $25 million on lobbying in the 2012 presidential election cycle and more than $16 million in the 2014 midterm election cycle. Based on money spent lobbying, the AARP consistently ranks in the top 1 percent of organizations tracked by the Center for Responsive Politics.
At the state level, public sector unions keep in place defined-benefit pension plans that promise generous payouts to today’s retirees at the expense of everyone else. While union bosses are free to negotiate favorable contract terms with the politicians that they bankroll, critical parties are left out—taxpayers and those who will be responsible for paying unfunded liabilities in the future.
Many other interest groups lobby for policies that harm young people, such as minimum wage hikes and other labor market regulations that prevent the unskilled from entering the job market. Occupational licensing laws stay in place thanks to the efforts of those who already hold those licenses and want to defend their favored positions. Teachers’ unions protect the jobs of poor educators and stand in the way of meaningful education reforms that would greatly benefit students and younger, more effective teachers.
Young Americans have no American Association of Young Persons to defend them. No lobby exists for getting rid of occupational licensing, and efforts to reform entitlement programs have gained only limited traction in Washington. Many government programs disburse concentrated benefits but have diffused costs, and the young consistently end up bearing the costs but missing out on the benefits. To the political powers that be, young people and their burdens are effectively invisible.
Proportionately, the young do not vote. Seniors, though, take voting as seriously as a job. In the 2012 election, turnout among those ages 65 and older was 72 percent, compared with 41 percent for 18- to 24-year-olds. The gap between voter turnout for the young and old increased from 15 percentage points in 1964 to 32 percentage points in 2012. Given the indirect costs imposed on young people by many government policies, these statistics are surprising, though many young people might not realize how the policies are directly affecting them. “Our generation has grown up with full acceptance of crushing national debt,” one frustrated 25-year-old told us. “We might not care as much as we should because we have never known life without it.”
One reason young people choose not to vote is that many feel alienated by America’s two-party system. Two-thirds of millennials perceive government to be inefficient and wasteful. The last five years have left a sour taste in young people’s mouths. Back in 2009, 40 percent of millennials saw government as inefficient and wasteful. Now, only 18 percent believe regulators have the public’s interest in mind.
Over 60 percent of millennials describe themselves as socially liberal, yet 73 percent favor allowing people to have private Social Security accounts. Additionally, 64 percent say that cutting government spending would help the economy, and 59 percent say cutting taxes would grow the economy. On the whole, young voters find themselves politically unaligned, as they tend to be socially liberal and fiscally conservative. This could help explain why millennials appear politically disengaged and why they often choose to remain independent.
Unfortunately, even if young people ignore the political process, the political process does not ignore them. But greater engagement by the young alone will not sufficiently pressure Washington to change course. Americans of all age groups need to understand the level of unfairness current policy creates. At the same time, Washington must allow young people to use the skills they have. This means America must evaluate its countless regulations, laws, and policies through the prism of how they affect new entrants to the workforce. Some regulations need to be abandoned in favor of a more hands-off approach that will let young people flourish.
The Internet and technology fields are currently the most unregulated sector of the economy. In this arena, America’s youth are in high demand and add significant value to the creation, production, and distribution processes. Rather than hindering their progress, government needs to provide the right conditions for them to succeed.
America’s problems have solutions. This is not generational warfare, but rather a case of an unintentional, but real, betrayal of America’s young. What is needed is a joint effort on the part of young and old to force politicians to discuss the issues and begin implementing solutions. Millennials’ parents and grandparents do not want to pass a future of higher taxes on to their grandchildren and great-grandchildren. They want solutions as much as anyone.
Diana Furchtgott-Roth is a senior fellow and Jared Meyer is a fellow at the Manhattan Institute. This article is adapted from their new book, Disinherited: How Washington Is Betraying America's Young (Encounter Books, May 2015). Follow Diana on Twitter @FurchtgottRoth and Jared @JaredMeyer10.