Andrea Tinker, professor of
Social Gerontology at
King's College,
London recently published the results of research into the way that the changing age distribution of the population is affecting different generations. Her conclusion is that
today's under 30s are the first generation who can expect lower living standards than their parents. In this writeup, I will present some
British demographic statistics, and my own hypothesis as to the underlying reason for Professor Tinker's conclusion.
- In 1999, about 20% of Britain's population was over 60. This is predicted to rise to 34% by 2050, with half that number over 80.
- Fewer children are being born: 91 live births per 1000 women in 1961, dropping to only 55 in 2000. In the 25-29 age group, the drop is even more dramatic, from 178/1000 in 1961 to 95/1000 in 2000.
- Between 1993 and 2000 the number of under-25s owning their own property has fallen from 21% to 19%. The number of 25-29 year olds living with parents rose from 18% in 1978 to 23% in 1998.
- The number of 25-35 year olds living alone rose from 2% in 1973 to 12% in 2000. The average age of a first time house buyer is now 35. The average household income is GBP 24,000/year - the average mortgage exceeds GBP 140,000.
- Tax relief on mortgages and grants for university education have been slashed. Professor Tinker believes that people born within the last 30-40 years face paying 1/3 of their lifetime's earnings in taxes just to support pensioners born before them.
- In 1997, Gordon Brown started taxing pension funds. It is estimated that GBP 100 billion has already been siphoned off - money that belonged to current contributors. The principle of compound interest means that the people who suffer the most will be the most recent joiners. Meanwhile, MPs recently voted themselves a 20% boost in the pensions - funded by the taxpayer.
It is clear that the trend is towards fewer taxpayers supporting more pensioners. I believe that this is no coincidence, rather that the generation(s) born since
1970 were systematically and deliberately set up by the policy makers of the so-called "
baby boomer" generation.
They set up a system for healthcare and pensions under which taxation is immediately paid out to recipients, rather than being invested for growth and the purchase of an annuity in a real pension system. They did this at a time when they knew that their own contributions would be minimal, given the population's age distribution at the time. Quite cynically, they decided that it would be easier to levy punitive taxation on their own children and grandchildren than invest for their own futures.
The money they saved by doing so, they poured into the housing market, driving up prices and placing mortgages out of the reach of many first time buyers. This created massive inflation in property prices - almost 20%/year at present - which they benefitted immensely from, already being owners of at least one property.
The state education system has been systematically wrecked. Grammar schools and the Assisted Places Scheme which sponsored children to attend fee-paying schools have been abolished, as the baby boomers further try to pull the ladder up after themselves. These same baby boomers, who once swore never to trust anyone over 30, are now in positions of responsibility and have carefully structured corporations to ensure that today's under 30s cannot enjoy privileges such as a job-for-life that the baby boomers enjoyed. They are scrapping defined-benefits pension schemes, after making sure that they got them for themselves, at the expense of those currently paying into employer's pension funds - us.
We are also paying the price for their disasterous social experiments. Soaring crime rates and falling literacy rates originate in the pseudo-liberal ideals of the baby boomers, who knew that they would escape scot free while their children and grandchildren would pick up the pieces for them. Rather than being the unfortunate result of a well-intentioned experiment than didn't work out, it is indicative of the baby boomer's defining attitudes: firstly, that nothing matters to them more than instant gratification, and secondly that they will never have to face any consequences for their actions.
What can we do? It may be too late; huge damage has already been done to the economic and social fabric of our country. The only hope is that when those of us born since 1970 are in power, that we use that power wisely: to ensure that not a penny of our our generation's money is wasted on or by those that came before us. Let them live on the pensions that they knowingly intended for us, with the standards of healthcare and accomodation that they intended for us, and let us invest our own money in our own future and our own children.