Friday, June 27, 2014

A Generational Reckoning

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American pollster Paul Taylor turned 65 years old in 2014 and awoke to a reckoning on the horizon -- after nearly eighty years of entitlements, the United States may have to choose between reduced benefits for the elderly or raised costs for the young. In Next America: Boomers, Millennials, and the Looming Generational Showdown, Taylor applies a “generational lens” to the change underway in America, hoping to unearth a potential solution to the “big showdown” he observes in American politics. An executive with Pew Research Center, Taylor methodically shares exclusive survey data and catalogs a number of unique insights. In Next America, Taylor comprehensively documents the changes underway within and across generations and optimistically concludes with a “new compact” that might avert a much-feared hard landing. Taylor’s optimism is appealing, but the generational linkages he asserts may be more tenuous than portrayed and the paucity of leadership may be undermining the potential for a constructive resolution.

Diverse But Unrelated

Taylor ably documents the broader demographic changes underway, principally the country’s increasingly racially and ethnic diverse makeup, the impact of immigration, and the incipient changes to marriage and the family.

According to U.S. Census Bureau and Pew data, the American population in 1960 was 85 percent white, 10 percent black, and 4 percent Hispanic. In the intervening period, numerous factors, such as the 1965 immigration law and divergent birth rates patterns, have resulted in significant changes to the country’s racial and ethnic composition.

By 2010, the respective percentages were 64, 12, and 16, with 5 percent Asian and less than 1 percent categorized as Other; by 2050, the respective percentages are projected to be 43, 13, and 31, with 8 percent Asian and approximately 6 percent categorized as Other (chart below, Kindle location 147 of 6129).

In the period between 1960 and 2010, the change in the nation’s racial/ethnic composition has coincided with changes in immigration patterns, marriage rates, and birth rates.

Regarding immigration patterns, Pew and Census Bureau data has shown that American immigration occurred over three distinct periods: 1840-1889, 1890-1919, and 1965-present. During the first two waves, the proportion of immigrants from Europe and Canada amounted to 96 and 93 percent, respectively. During the last wave, the proportion of immigrants from Europe and Canada totaled only 14 percent. In contrast, the proportion of immigrants from Latin America and South/East Asia totaled 77 percent (50 and 27, respectively). From Mexico alone, the proportion of immigrants was 28 percent. Lastly, the absolute total of immigrants from Latin America and South/East Asia numbered 34 million, slightly higher than the entirety of the two preceding waves, 32.5 million immigrants. (These figures exclude the approximately 11 to 12 million immigrants in the United States illegally.)

Regarding marriage rates, Taylor explained that intermarriage rates have risen since 1960 (from 2.5 percent of marriages involving spouses of a different race/ethnicity from each other to 15.5 percent), but the proportion of whites marrying outside their race/ethnic groups remains the lowest at 9.4 percent. Blacks, Hispanics, and Asians intermarry at rates higher than whites, but as Taylor points out, whites remain the most populous group and thus constitute 43 percent of all new interracial or interethnic marriages. Taylor noted divorce rates may be declining, but only in part because less couples are marrying in the first place. In this vein, Pew Research Center data has shown that the proportion of all adults ages 18 and older who were married was 51 percent, a decline of 21 percentage points since 1960. Furthermore, the proportions currently married by racial and ethnic group diverge notably. More than half (55%) of whites are married, a decline from 74% in 1960. Among Hispanics, 48% are married, compared with 72% in 1960. Among blacks, only 31% are married, compared with 61% in 1960 (URL).

Regarding birth rates, Pew Research Center data has shown that foreign-born women still account for a substantial share of 2010 births, a trend going back to 1990 (URL). In May 2012, the Census Bureau reported that non-Hispanic whites accounted for a minority of births in the U.S. for the first time (URL). Lastly, the share of births to unmarried women continues to rise, with those to black and Hispanic women far greater than that of white women.

Taylor readily recognizes each phenomenon may strain the capacity for compromise:
“resilience will be put to the test… at a time when a growing share [of elderly] will have fractured family to which they are only loosely attached”
Nevertheless, he confidently predicts generational familiarity and sympathies will prevail:
“young and old Americans aren’t spoiling for a fight on this issue. They like each other too much”.

Fractured families and loose attachments may be an understatement.

Separately each trend may be innocuous, but cumulatively, elderly Americans may not only be generationally distinct from and unfamiliar with the young, but, more consequentially, completely unrelated.

Due to immigration patterns, the American population will feature preceding elderly generations of European immigrants accommodating succeeding younger generations of immigrants from Latin America (especially Mexico) and South/East Asia. Furthermore, if current marriage and intermarriage rates hold, couple and family formation among Latin American and Asian immigrants will exceed that of whites and European immigrant descendants. Lastly, if current birth rates hold, the number of children and overall family size among Latin American and Asian immigrants will similarly exceed that of whites and European immigrant descendants.

By 2050, according to 2008 Census Bureau projections, black, Hispanic, Asian, and other immigrant individuals will constitute the majority of Americans up to the age of 24. Conversely, white (not Hispanic) individuals will constitute the majority of Americans ages 65 and older. (The median age of black, Hispanic, Asian, and other immigrant individuals will be in the mid-30s, that of white (not Hispanic) individuals will be 44.)

In effect, white Americans will be having less progeny in comparison to black, Hispanic, Asian, and other immigrant groups and their progeny will be a smaller percentage of the overall population.

In previous eras, generational conflicts, to the extent they existed, were ameliorated by the fact that elderly individuals had family connections to younger individuals and, in the aggregate, these multi-generation family lines constituted the bulk of the population.

In the future, one can reasonably conclude that familial linkages in 2050 between Americans of European ancestry and Americans of Latin American and Asian ancestry could be minimal to none.

Taylor is right that a senior citizen of European descent will very much like the young Latin American and Asian families down the street, but expecting these two generations – two generations dissimilar historically, culturally, politically, linguistically from each and without familial links – coming to terms on how entitlements will be restructured may be overly optimistic.

Popular With Those Who Wouldn’t Know Better

In documenting America’s generation profile, Taylor acknowledges the scholarship of American demographers William Strauss and Neil Howe, who established a popular framework depicting various generational archetypes. While Taylor notes the framework attracted criticism for being too “formulaic,” he argues generalization helps spotlight the principal commonalities and differences between generations. Like Strauss and Howe, Taylor identifies four generations:
1. Silent Generation (born 1928 to 1945)
2. Baby Boom (born 1946 to 1964)
3. Generation X (born 1965 to 1980)
4. Millenial (born after 1980)

Taylor’s choice of birth year brackets differs slightly from Strauss and Howe. While only diverging by four years (e.g. Strauss and Howe identified 1943 to 1960 as the Baby Boom cohort), Taylor inadvertently queues another of the pair’s observations.

In 13th Gen: Abort, Retry, Ignore, Fail?, Strauss and Howe previewed Taylor’s retrospective by focusing on the relationship between the Baby Boomers and Generation X. Unlike Millenials, Gen Xers constituted a smaller cohort than the Baby Boomers and were deemed, rather unfairly, the modern-day equivalent of the Lost Generation. Strauss and Howe demonstrated otherwise however, particularly because all the cultural icons allegedly representing their vacuousness and alienation (e.g. Madonna, Spike Lee, Matt Groening) were not Gen Xers, but actually Boomers.

Strauss and Howe outlined the inaccuracy of this depiction but did not ask what unpopularity with contemporaries – while achieving popularity among a younger generation – says about an individual.

One potential answer is that maybe such standing means generational peers recognize the individual’s worldview is somewhat incongruous with their shared experiences and attractive only to those with fewer (or no other) experiences to draw on.

Like Barack Obama, the current president of the United States.

The breadth of President Barack Obama’s support among younger voters is well-known. However, according to Taylor’s data, Obama’s dearth of support among older voters includes his peers in the Baby Boomer generational cohort.

According to Taylor’s generational brackets, Baby Boomers were turning 18 (e.g. the legal age to vote) right through 1980, among them Barack Obama who turned 18 in 1979 in the middle of James Carter’s presidency. Examining generational voting history (chart below, Kindle location 147 of 6129), Taylor showed how a cohort voted compared to the national average. Based on Pew data, Obama’s Baby Boomer peers were more likely to vote Republican in presidential and congressional elections, specifically 1994, 1996, 2000, 2002, 2008, 2010, and 2012.

Moreover, the first tranche of Generation X that turned 18 during the Reagan-Bush era from 1980 to 1992 has also generally voted Republican. The second tranche turned 18 during President William Clinton’s time in office between 1992 and 2000. This group has been strongly Democratic since 2002, but, as recently as 2004, went Republican.
However, Obama’s popularity has appeared to have peaked with his second inaugural in 2012. Ever since then, the bottom has apparently fallen out from beneath him amid numerous policy fiascoes and emerging scandals and Obama has seemingly lost the confidence of the voting public.

Unless reversed, Obama’s decline could negatively influence the impression of youngest voters, who would now have the experience of a failed presidency similar to Baby Boomers who went on to heavily favor Republicans in the wake of the Carter era.

Immigration First

In Taylor’s estimation, presidential leadership could bring the elderly and the young together on entitlement reform because, after all, “their fates are intertwined.”

Taylor, however, assumes the American people are united on the more polarizing matter of immigration. The current president – the one rejected by his generational peers and rapidly losing credibility with all segments of the public – and the majority of the nation’s elite are united in favor of liberal immigration, in spite of widespread opposition throughout the country. Unsurprisingly, neither the president nor the elite have moved to address entitlement restructuring or the metastasizing debt.

Between now and 2050, generational, ideological, and racial/ethnic divisions will continue to face off over the future of immigration policy. Furthermore, current trends in wealth and income inequality (both generational and racial/ethnic) may remain problematic.

As Taylor notes, the elderly generation continue to accrue wealth and entitlement benefits while the youth suffer disproportionately from lower incomes and higher debt, conditions compounded when examined on the basis of race and ethnicity.

Regardless of the eventual outcome, the interim debates will leave some elements dissatisfied at best, hostile and alienated at worst.

Acknowledged – previous waves of immigration have been absorbed peacefully and successfully. However, previous generations did not have to contend with the simultaneous cost of maintaining a massive entitlement state and historic levels of national debt.

The Sixties "generation gap" occurred within families, this new one is emerging between strangers.

Taylor notes Baby Boomers, once the vanguard of youth and idealism, have become ardent supporters of the small-government conservatism espoused by the Tea Party. Moreover, Howe and Strauss predicted Generation X, having been front row to the breakdown of the American family and government dysfunction in the Seventies, will be the most conservative generation yet.

Howe and Strauss predicted they would vote to reduce their entitlement benefits; what they couldn’t predict is whether that position would win, especially when newly arriving immigrants, particularly those from Mexico and China, approximately one-third of the 44.5 million that arrived between 1965 and now, are from countries where substantial proportions of the population believe the government should be primarily responsible for the care of the elderly, far greater than the United States.

The cumulative experience will prompt divisions along intergenerational, interracial, and interethnic lines in the lead up to most diverse American population in the country’s history without the family ties to ameliorate them.

Numerous commentators have cautioned the continued expansion of the entitlement state will only impoverish the country. Other commentators have warned that unlimited immigration, especially from Mexico and neighboring Latin American countries, may result in a cleft country.

Before America can address entitlements, the country must decide whether current demographic trends should be accepted or addressed and how immigration policy should be modified.

In the wake of a reckoning, the stakes will be, to paraphrase Benjamin Franklin, “an America, if we can keep it.”