Nostalgia is a wonderful thing; it allows us to look back fondly at times in our lives which were often difficult and unrewarding. It can produce joy in the present moment and assist us in feeling optimistic about the future. I assume that it evolved in us as some sort of defense against suicide or despair; people who felt nostalgia were less likely to just walk into the ocean and not come back.
Of course, nostalgia can also be harmful. It can cause us to hold onto people, possessions, and situations which would be better left behind. Worse yet, it can cause us to drastically misinterpret the past, which in turn causes us to make mistakes in the present day. Such is the case with business-book-huckster Eric Chester’s lament regarding the elimination of teenaged paperboys and other forms of youth labor. Chester notes with disdain that today’s paper is “will be thrown from the window of a hail-damaged 2006 Saturn Ion by a 30-something woman, and it will land at the edge of the curb at least 35 yards from my front porch.” Things were different when Eric Chester delivered the newspaper in 1970, yesireebob.
To his credit, Chester doesn’t necessarily blame the Millennials for not having been paperboys, which is very generous of him. He’s identified another enemy — and since he’s a Baby Boomer, you can probably guess what it is.
Like so many jobs of the 20th century, the job of paperboy has been eliminated, and with it, the work ethic of generations past.
Teen employment in virtually every industry has dropped dramatically over the past 20 years.
And yet, when young people take their first job – or enter their first career position, employers expect them to not only have the required technical skills, they expect them to already know how to work. And regardless of what they’ve learned in a classroom, the vast majority simply don’t.
All of this is true. Wonder why that is?
The job(s) that would have given them those skills have been eliminated, given to a more experienced worker who is worth the $15 per hour the government has mandated, and/or handed over to a robot.
The fellow who sent this article to me noticed this comment and pointed out that many states and municipalities are raising their minimum wages. Could this be the reason? Is the minimum wage now so high that it puts adults into the jobs that kids used to do?
Before we get to that, I want to address Chester’s story. I, too, was a paperboy as a kid, first for the Columbus Citizen-Journal and then for the Suburban News Publications. Those newspapers relied on an army of grossly underpaid kids who were indirectly subsidized in many ways by parents who paid for bikes, helped their children in the winter, and delivered the papers themselves when the kids had chicken pox. I doubt that Chester actually delivered the 158 newspapers by himself every single day of the week, rain or shine, without fail. I bet his parents recall his job quite differently.
My mom stayed at home when I was a kid. Chester’s mom probably stayed at home, too. Those stay-at-home moms served as the glue to hold communities together. They cleaned their own homes, helped their kids, and served as an informal network through which social connections were made, careers were determined, and emergencies were solved. We don’t live like that now. We decided, as a society, to more or less double the size of our workforce by making women get involved. But we didn’t double the amount of available work. So everybody was paid less. This gradual evisceration of the middle-class wage went unnoticed because you couldn’t see it happen from day to day — but it happened.
At the age of 38, my father was basically where I am at forty-eight, career-wise. He drove a new Town Car and put two kids through private school. He had a much more valuable home than I do — about twice as valuable in today’s market. And my mom stayed at home. It’s true that Dad was frugal in ways that I am not; they didn’t have carbon-fiber mountain bikes or Paul Reed Smith guitars back then. But there is no level of frugality that would allow me to live the way he lived at the time. I’d need to earn four hundred grand a year, and we’d feel pinched still.
Oh, and he was also setting himself up to retire to a plantation in South Carolina.
Today’s kids don’t have moms to help them do the paper route. Their moms are out there trying to have careers of their own. So the kids go to school and then to aftercare. We used to call that being a “latchkey kid”. Nowadays it’s rare for a child to go home after school until he’s old enough to be at home by himself. Given how our society winks at violent pedophilia nowadays, I’d define that age as sixteen for boys and 42 for girls. If Eric Chester were thirteen in 2020 instead of 1970, he’d be eating a pre-packaged snack while waiting for a schoolbus instead of delivering papers and then returning home for a hot breakfast, because his mom would be busy making PowerPoints for a living and Amazon shopping on her company laptop while planning her next business trip to see her excitingly demanding boss.
There’s also the fact that you could ride a bicycle around an 85-paper territory in about 45 minutes back in 1970 when everyone took a paper. I used to walk mine and it rarely took more than an hour. Today, with maybe one in ten or twenty households taking a paper, you need a Saturn with hail damage to make it work time-wise.
You get the idea. We won’t have paperboys until we restore the America which needed them: a country where people were literate, interested in the news, and willing to pay for en masse, while also making sure we had moms at home to look after the paperboys. What about the rest of Chester’s assertion? Are teenagers no longer working because the minimum wage is high enough to attract “experienced workers”?
This chart answers that question. The minimum wage, in real dollars, hasn’t been this low in the Boomers’ lifetimes. It was half again as much back when Chester&Company were working their summer jobs. But I think that the real story is even more frightening, because that light blue line which shows “productivity” is really a measure of what people are paying for fixed assets now. The minimum wage was $3.35 when I worked at Rax as a 15-year-old; it’s $7.25 now. I lived with my mom in a townhome which now rents for almost four times what she paid; two years prior, she had sold our house for — wait for it — one-ninth of its current price. She’d just bought a new Honda Civic S for $6,495; that’s a $26,000 Civic Si today. So the minimum wage would really need to be ten or eleven bucks just to keep pace with that — and that’s before you consider the fact that certain costs, like healthcare and education, have done far more than triple in the thirty-three years since then. I could have gone to Ohio State for $380 a quarter; that would be $2,810 now.
I can make a pretty strong argument that the “Fight For $15” minimum wage doesn’t buy what my Rax wage of $3.35 used to buy. And yet Eric Chester is right: even at $7.25 an hour, you can find plenty of full-time adults to do the work that used to be done by kids and part-time workers. What happened?
You know what happened. The “Greatest Generation” decided in 1965 to open the floodgates for immigration. Their Boomer successors voted again and again to remove even the most nominal of limits to incoming labor. We’ve had more than thirty million new legal immigrants since the turn of the century, which sounds insane but is, in fact, the case. There are about 45 million legal immigrants and another 11 million “undocumented” immigrants in this country.
Adding 56 million people to the American economy, more than half of which are considered “low-skilled” workers, did exactly what you’d expect to wages. We are told that “the economy benefits” from this additional labor, which is a nice way of saying that the stock market benefits. What happened to human beings? Read for yourself:
- Real wages rose at the top of the distribution, whereas wages stagnated or fell at the middle and bottom. Real (inflation-adjusted) wages at the 90thpercentile increased over 1979 to 2018 for the workforce as a whole and across sex, race, and Hispanic ethnicity. However, at the 90th percentile, wage growth was much higher for white worker sand lower for black and Hispanic workers. By contrast, middle (50thpercentile) and bottom (10thpercentile) wages grew to a lesser degree (e.g., women) or declined in real terms (e.g.,men).
- The gender wage gap narrowed, but other gaps did not.From 1979 to 2018, the gap between the women’s median wage and men’s median wage became smaller. Gaps expanded between the median wages for black and white workers and for Hispanic and non-Hispanic workers over the same period.
- Real wages fell for workers with lower levels of educational attainment and rose for highly educated workers.Wages for workers with a high school diploma or less education declined in real terms at the top, middle, and bottom of the wage distribution, whereas wages rose for workers with at least a college degree. The wage value of a college degree (relative to a high school education) increased markedly over 1979-2000. The college wage premium has leveled since that time, but it remains high.High-wage workers, as a group, benefited more from the increased payoff to a college degree because they are the best educated and had the highest gains in educational attainment over the 1979 to 2018 period.
Let me put this in unkind but forthright terms: In the post-1965 America, the harder you work the less you’ll be paid, and the more your wages will sink over time. And I should remind the reader that these “real” wages are adjusted to CPI, which is great if you’re shopping for a hamburger but absolutely useless if you’d like to own a home, get a college degree, or enjoy some life-saving medical treatment. Even the “high-wage” workers who saw pay increases on paper aren’t necessarily seeing an increase in their standard of living. This is true in Ohio, where homes in nice neighborhoods are only priced at ten times what they were forty years ago. Imagine how true it is on the coasts. Remember The Brady Bunch? Six kids, a stay-at-home mom, and full-time help. Dad was an architect. Glassdoor says that a top-rate architect in California can earn $150,000 a year, which is about $8,000 a month after taxes in California. Living in that neighborhood now would cost you a minimum of $1.6 million dollars, so that’s about $12k a month in principal and interest. If you really wanted the Brady Bunch lifestyle now, with six kids in school, two cars, and a maid, you’d have to
a) earn $750,000 a year;
b) forget about taking vacations or buying new clothes for anyone but Marcia.
“Okay, Jack, I get it,” you’re saying. “Everything sucks now. But surely things got better for some people?” Well, yes. Take a look at Eric Chester. He was thirty years old in 1987. Let’s say he bought an index fund. It’s worth ten times what it was then. Let’s say he bought real estate in Ohio. It’s worth as much as ten times what he paid. If he bought real estate in Calfornia — or Denver, where he lives — perhaps it’s worth twenty times what it was then. Every single economic policy change since about 1990 has had two primary effects:
a) lowered real wages through increased labor market participation and/or lowered demand for labor;
b) increased the value of fixed assets or investment instruments
In other words, if you were “holding” in 1987, when the oldest Boomers were forty and the youngest were twenty-five, you’re golden now. If you were just starting your career in 1987, you were racing against time. If you’re starting today, the deck has been stacked against you higher than you’ll ever clear. Want to live the middle-class life of 1975? Better hope your IPO nets you ten million bucks. The wealthiest of the Baby Boomers deliberately created a world in which they’d pay less for the things they wanted (employees, labor, televisions) while being paid more for the things they owned (real estate, index funds, 1959 Les Pauls, 1985 Porsche 911s). It was a hell of a trick, wasn’t it?
Eric Chester looks at the hellscape generated by his generation and what he sees is that there aren’t any more paperboys. I look at it and I have serious concerns. I note that support for explicitly socialist government is growing by leaps and bounds. Some of my friends think this is because the Millennials are stupid. “Don’t they know that they won’t be the people who benefit from a communist government?” This is what I think the proto-socialists have figured out:
* In the event of a Red Revolution in this country, they have a very slim chance of becoming part of the nomenklatura who have power, real estate, and freedom to determine their own lives.
* If there is no Red Revolution, they have precisely zero chance of ever owning a home, saving for retirement, or starting a traditional family.
This is where the situation in our country becomes dangerous. As long as there is some chance of succeeding in the current state of affairs, people will generally play along. If you take away all of their hope, they have nothing to lose. Talk about bread lines and mending old clothes doesn’t frighten people who have already internalized the fact that they will be earning close to starvation wages for their entire lives. This is particularly true if they have no children who would be at risk. It’s a roll of the dice for them and things can only come up better.
Very few people in my generation grew up screaming “EAT THE RICH” and stuff like that. We figured we had a chance to be the rich, even if things might not be as easy for us as they’d been for our parents. The twenty-five-year-olds of today no longer think they have any chance — and they live in an echo chamber of $25-per-article bloggers who screech night and day about the potential benefits of violent economic redistribution.
Now here’s the good news: This situation could right itself. Within twenty years, there will be a massive redistribution of wealth in this country through the simple mechanism of probate courts and inheritance. The price of many things will go down, from 1959 Les Pauls to warehouse space. I suspect a lot of Millennials will leave their microliving apartments and head back to suburban enclaves made affordable by the death of their existing occupants and the unwillingness of various inheritors to live in Florida or Phoenix. The stocks will be given to people who would rather sell than hold.
We might also see some societal changes as a result of today’s coronavirus and its many pandemic successors to come. Tommy Friedman’s flat world doesn’t look so attractive when the container ships can’t enter port and every Eat, Pray, Love trip is a chance to wind up isolated on a Navy base for a year. We’re going to have to start making things again. And we might find that we no longer need to own or consume as much as we thought. When most of the available jobs are in manufacturing and not in the creation of PowerPoints, perhaps some people will decide that staying home is a better alternative. Which means they’ll have time for children, and cheap homes in which to raise them. Those new parents will want something to read, and someone to deliver it. In other words: Ask not for whom the paperboy throws; he might be throwing for you.