The stereotype of the millennial leftist still, unfortunately, holds true. So-called Social Justice reigns over economic feasibility. Revenge politics is more important than employment and national debt means nothing when you can keep your welfare and benefits.
The problem is, national debt is a real threat. It has been rising since the end of World War 2 and even past the end of the so-called Keynesian Consensus. In many places, it is rising out of control.
As Niall Ferguson argued, past generations lived far beyond their means with the help of debt. Welfare states were propped up, state health and education overtook private in many areas and public pensions promised to look after an entitled populace far past their retirement.
The problem that arises from this is that the old generations have basically condemned their descendants. Debt will hit a peak and governments will have to change their policies. Some governments have been attempting to do so already, but have been met with huge protests by a populace grown entitled by decades of unsustainable public gifting.
When people from older generations reminisce about the ‘good old days’, often enough they are complaining that they can’t keep living off of government benefits. The Keynesian ‘Golden Age’ was pleasant to live in for many citizens. Money seemingly popped out of thin air and this money paved the way for the welfare state.
This ostensibly came to an end in the 70s with the Oil Crisis, stagflation and the union riots in the UK. This is not actually the case. Governments still borrow, print and spend without inhibition. In order to sate an overly entitled populace, democracy demands populists. A democratic government cannot hope to survive if they cut down on people’s benefits, as a myriad of national examples have shown us.
But someone has to pay-off this debt, and the Communist solution of just ignoring it won’t work.
We need debt
Don’t misunderstand this article. Debt is necessary in a capital-driven society. Projects of public and private nature require funds that one may not necessarily have. Debt-driven enterprise can be fine. You would be hard-pressed to find a modern business which wasn’t funded by debt somewhere in its existence.
The problem lies when people cannot afford to pay off their debt. There is a big difference in borrowing for a business and borrowing to pay for a TV in your lounge. Debt is meant to be a tool for future financial gains. When you’re borrowing for pleasure rather than investment, then you are risking the entire fabric of your financial stability.
This is what governments are doing.
Some may argue for the merits of welfare and public employment but, the fact of the matter is, they do not generate income. Public jobs are a sinkhole for funds and welfare continues to perpetuate dependency which rarely results in any social elevation.
Private debt is the indaba of the private debtors and does not (should not) affect the people uninvolved. Our problem lies purely with National Debt.
National Debt is Theft
Borrowing to satisfy your pleasures, or more specifically, supporting a government who borrows to gorge your pleasures – is effectively stealing from future generations.
Keynes (1883-1946) didn’t have a problem with the pain of national debt on future generations, his famous quote being: “In the long run we are all dead.” (A Tract on Monetary Reform, 1923, Ch. 3)
This has not only become policy for populist government but also for many, often well-meaning, people. By living beyond their means, the last generation has stolen from future generation’s means.
Today, a large portion of our taxes and reason for inflation can be attributed to paying off debt. This is effectively taking money from citizens to pay off the actions of their grandparents. This is a gross injustice that those who had no say now have to pay for their parents’ and grandparents’ greed.
It’s not over yet
Despite Niall Ferguson’s claims in the interview linked earlier, the Age of Debt is sadly not over. Governments, especially South Africa’s, are still borrowing to satisfy their population’s demands. This means more debt for further and further generations.
Even with this, the youth still seem to support Socialism – either due to the entitlement of their parents or the allure of left-wing pseudo-social satisfaction, they believe that government spending can keep going on forever.
But it doesn’t matter how much you care about the poor or like public healthcare – money isn’t infinite and even if you don’t steal the money from someone today, you’re stealing it from future generations.
Survival with Liberty
They don’t pay taxes now, but they will someday and when they do, they will make the stereotypical shift to conservatism. Alas, by then they are too busy to protest on the right side of the economic playpen.
It isn’t all doom and gloom, though. Many of members of the youth globally are becoming aware of the dangers of government spending and the transient nature of Socialist satisfaction. Youth movements have grown into fully fledged political forces as Brazilian protesters shout, “Less Marx, More Mises.” Musicians and rappers are turning on the previous anti-Capitalist rhetoric and opposing their apparently “socially aware” governments.
The Cold War isn’t over
Communism failed. Socialism was proven to have failed. The wall fell and a world cried with relief, but we are still living with the demons of that era.
Simply enough, the world cannot survive to live another generation under the burden of government control and spending. Even without overt oppression of the Soviet scale, the debt will keep rising.
With no one paying it off now, it will be youngsters like myself and those who come after me who will have to pay it off.
If we wish to survive financially, and live with the wealth we justly earned, we need to take a Libertarian future seriously. There is no other solution but to reject the ever encompassing demagoguery of government and their leftist proponents.