Very good analysis here! Especially like the part about the rising costs of childhood supervision, discussing that change could be entire book.
However, this, listed as a rising expectation, is simply a rising reality:
> 6. That old people have most of the wealth while young people are often broke.
For anyone our age (Gen-X) or younger, throughout our entire lives every major policy and demographic change have led to it: Medicare part D, ZIRP, Obamacare, implications of longer lifespans and aging population on SS outflows. Even things like the Cash-for-Clunkers program, on net, benefitted those who were established financially (older folks) at the cost of an 18 year old looking to buy a cheap first car.
Policy wise, everything came together to tilt in favor of the older, which is why average first time home buyers are now 40, which should be treated like an apocalyptic trend for long term social stability.
'Raise the status and social acceptability of living cheap and making sacrifices.'
I might be wrong, and I'm not going through the effort of finding out for sure, but I'm pretty sure I've seen you criticizing people praising the virtues of frugality. Sorry if I'm wrong, but at least that's the vibe you give off, for me.
I agree with everything in this post (including the above citation). I would have framed things differently, used different emphasis : Everything is increasingly routed through big, illegible Systems with inscrutable dynamics like governments, big corporations, complex interconnected world markets, Moloch-instantiating social media, etc ; not enough things are routed through Dunbar-level institutions anymore. I would characterize Rising Expectations and Rising Requirements as two examples of a general failure of our social institutions to keep up.
Dunbar's Number Of The Beast: Vatican Declares 150 Is Right Out
Not sure about an exact citation, but this is the blog that taught me to always think in terms of absolute rather than relative value, and also that I'm probably often making [small...rather large] mistakes by obstinately refusing to pony up small amounts of money when the time/effort/ugh field savings are large. Penny wise, pound foolish - value your time more highly, even if it means getting shaken down for a bluecheck or TSA Pre or whatever. So, yes, there's a bit of a tonal mismatch.
I think the key difference is that here, anti-frugality is classified more under a Requirement than an Expectation. That is, for life's biggest and most meaningful cost sectors, it's increasingly suspicious, illegal, and/or de facto impossible to make the frugal choices of yesteryear. Whereas saving the $20 that coulda been spent on a used microwave from The Salvation Army or whatever is a suboptimal choice one can still make in current_year. I think those are the kinds of superficially frugal, performatively virtuous sacrifices that Zvi (mostly correctly) tends to deride. They do affect affordability on the margin, but can only ever nibble at the edges of the problem, especially as costs for small-bore stuff overall continue to plummet. Like we won't solve affordability by "Living Off Beans And Rice Challenge" going viral, you know?
I'm not sure that's a fair reading of what Zvi is writing here. He says 'Raise the status and social acceptability of living cheap and making sacrifices', that's more about Expectations than Requirements.
He's talking about promoting of a different lifestyle, and this implies more than just praising those who make rationally cost-effective cut to their spending, and deriding others. It's necessary to respect the general aesthetics of a frugal lifestyle, even if you think some of the specific actions these aesthetics will suggest are not optimal.
Great article - quite topical and an area where your writing style / analysis I think is helpful. Have you done a deep dive on housing yet? I think that is one of the major angst points here that needs a bit more addressing. Scott Alexander had a nice piece on the "vibecession" the other day, but I am not sure really addressed this central issue sufficiently - hand-waved it away by noting that renters also feel unhappy about the economy.
There is a lot tied up in housing - perhaps more than I once realized - renting and owning are not as true trade-offs in practice as they are in theory. I guess this is what they call the "housing theory of everything".
It is both a consumption good, but also an "exclusive investment vehicle" that has made an entire generation wealthy even absent (hard work) and true savings. I did not fully appreciate that until spending more time out in California and realizing the depth & breadth of all the housing wealth that been created. When everywhere you look there is a $2-5M home that was worth 10x less a couple decades ago, that feels like many were handed a golden ticket that is now very difficult for the current generation - be the underlying issue interest rates or lock-in due to mispricing during COVID or regulatory restrictions on increasing supply.
It would be like if everyone in past generations made their wealth investing in Walmart or Amazon stock or something... and now all the most valuable companies are no longer in public equity markets during their early stages & all the gains are out of reach for the average person... hmmm...
This piece is superior to everyone else's most careful take on the topic, as well as your own previous entries in the series. If I wasn't already subscribed, this would do it for me.
Every generation’s number is a little unhinged, but that chart where Gen-Z needs ~$600k to feel “financially successful” genuinely scares me. One can’t help imagining the proletariat finally rising up and breaking their chains over the indignity of being forced to fly commercial to tropical getaways.
That aside, I realize a central theme of Mr. Money Mustache's (frugality and financial independence) blog, at least for the the last ten years, has been this spiritual Stoic push at its core to get people to try to appreciate the absurd material luxury we live in today while reigning in their Rising Expectations and finding hacks around Rising Requirements. Obviously not a cure for society at large (since it has too many words) but perhaps helpful for bookish types who feel trapped in rat races.
UPDATE: I've seen a few criticisms of the quality of the "Empower" survey, showing Gen-Z needs $587k to feel "financially successful".
The simplest takedown is that that same firm did a similar survey a year prior and found Millenials are the ones that said they needed $550k while Gen-Z said they only needed $130k(!)
This is bad. Going to print with your results when you had such a wildly different results the year prior with no apparent attempt to understand why suggests they're deeply un-serious.
That actually makes a lot of sense - my eyeball-popping gut reaction to the graph was less the supposed Gen Z number, but that those of my own generation apparently asked for so little (and boy did we get it). That's not at all what I remembered from #Occupy and similar watershed Millennial moments! Weren't we supposed to be the spoiled participation trophy generation with vastly inflated expectations of effortless mastery due to The End Of History? Where'd this anomalously humble number come from?
Or perhaps affluenza is hereditary, heh...chalk one up for Bounded Distrust either way. And in line with the post, even if the exact numbers are iffy, that's still a clear signal of Something Was Wrong. (Which would have also been an appropriate archives link to include in this post, come to think of it...)
There is no mention in this analysis about having extended family to help with childcare and other expenses. If you go to school in the town where you grew up and live at home and eat with your family, education can be a lot less expensive. If you find the right partner in town, and decide to live next to your inlaws, they can help provide childcare. I think a LOT of immigrant families work this way, and they do make it work and they pass it along to the children to make it work again. It is the culture that pushes them out of the nest, by telling them to be "independent", but real independence only happens when you save enough money to have a backstop to current income,, or a job that is secure enough that you don't worry too much about being laid off
The other option that no one mentions is joining the military, which provides a LOT of support in a lot of ways, and teaches young people HOW to live by themselves. No one offers this up as a learning experience, which it definitely is. And it only costs a few years of your life for that education. Those who say that you are taking a chance on getting killed aren't looking at the actual numbers - relatively few service people are killed or severely injured in service these days, and the government takes care of those who are, and their families.
Children used to be considered a valuable resource to a family, because they could go off and do work and earn money. Now they are considered a fragile potential liability who will come back and haunt the parents forever, maybe killing them - but are still "precious", in spite of the potential liabilities. I don't think many couples about to get married discuss WHY they want or don't want kids, and come to some understanding about how they are going to raise them. They seem to be taught to think in the "here and now", and not think about the future. Maybe we also need to teach young people to think more about the future, than to just live in the present.
I'm impressed with Zvi's excellent prescriptive analysis of this societal issue. My ongoing concern is persuading a bipartisan majority of politicians to reevaluate citizens' needs, recognize that there's no one-size-fits-all solution, and then implement the right legislation with clear, practical directives, funding guidance, and mechanisms. If given the chance, I would definitely vote for political candidate Zvi Mowshowitz and similar candidates. So, then, perhaps, if he has the stomach for it...
> If given the chance, I would definitely vote for political candidate Zvi Mowshowitz and similar candidates
I mean, this is a big part of the problem itself. There's, oh...two and a half of us who would vote for any politician with a Zvi platform in any given geography. And empirically, if Zvi or Scott Alexander or anyone else like that actually decided they hated their lives and dedicated 2 years to running, they'd emprically get one of those 2.5 votes, because of vibes and aesthetics and everything else.
There's no road to "there" (good governance from politicians actually focused on outcomes with smart policies) from here.
If I had analyzed my previous comment from a discourse perspective like J.L. Austin's performative-constative dichotomy, my words might have sounded confusing. You probably agree that advocating for good governance and innovative policies isn't just limited to blogs. In terms of public image and aesthetics, while I've only seen Zvi present and answer questions on stage in Steamboat, Colorado, I didn't notice anything that seemed even slightly an automatic dealbreaker. There are also various roles, such as candidate, elected representative, advisor, or supporter. I aim to be a hopeful realist, believing that there's a district in New York—maybe just one—that could give Zvi a chance to share his ideas with a wider audience, either directly or indirectly, likely leading to increased citizen and voter awareness, positive reactions, and overall good feelings.
> I aim to be a hopeful realist, believing that there's a district in New York—maybe just one—that could give Zvi a chance to share his ideas
I would 100% vote for Zvi, or anyone with his platform. This is less a discourse thing from my end than a pragmatics thing - after all, even Libertarians, which are a much larger superset of this style of opinion and policies, only ever got 3.3% of the national vote at the highest, and generally cap out at 3-5% at Governor level votes.
Some L's have won actual City Council elections, and that's about where they cap out. I agree, it'd be awesome to see a Zvi or adjacent somewhere in politics, I just think in terms of "moving the needle on any problem that matters" they will be extremely limited in scope and impact.
Should we still try for that level of scope and impact? Absolutely! I will happily vote for any candidate of any flavor with thought processes and proposals like this.
But I think we can't realistically expect people of Zvi's talents to actually immolate their lives for a few years to have, *at best* after years of effort and upending their lives, a rounding error impact in a City Council somewhere, and that's the other part of the problem.
That said, we're definitely on the same side, and I too wish we had politicians even willing to parrot some of these ideas, they don't even need to originate them, and dream of a day and place where this is happening.
One useful thought experiment is to imagine that all of your listed policy solutions (make housing, childcare, healthcare, education, and energy vastly cheaper) and try to predict what the discourse will look like after that happens. If housing becomes a lot cheaper, I'd predict there are tons of articles about homeowners investments getting ruined, ruining retirement. When healthcare gets cheaper, we'll lament the loss of healthcare jobs. If energy and childcare get cheaper, we'll just switch to complaining about some other factor of life being expensive, like international vacations or handmade xyz. I think Yglesias hits the nail on the head when he points out that this is all downstream of money taking a larger importance in people's lives, as other meaningful things diminish in importance.
The missing key is productivity. If you worked twice as hard in an hour and produced twice as much and your wages stayed the same you'd be angry. Same if you invented a new process or learned a skill that doubles your output. While workers today aren't working twice as hard, worker output has risen considerably faster than wages. On a revenue basis it only takes a couple employees at s&p 500 companies to make a $1mil in revenue. Across the economy it's closer to 4. In 1975 inflation adjusted it took about 9, and even around 2000 it was close to 6-7. So workers today are way more productive, handling more complex and difficult tasks, but only earning a tiny bit more in wages. The majority of the benefit of our learning better skills, techniques, mastering technology, streamlining processes, and in some cases just working harder is: more money for someone else. Yes you make a tiny bit more, but again we've doubled our outputs per worker and wage growth hasn't caught up.
I do wonder what the Pareto-optimal amount of working harder vs increased wages is. Sometimes it's possible to work twice as hard in a totally invisible way that's not captured by any metric - like not just as one's own wages, but also not as meaningful additional profits, customer satisfaction and retention, etc. Other times those second-order effects are noticeable, especially at scale (if enough employees refuse to work harder, or work at all, that's a big deal!)...and in any moderately competitive industry, eventually that means business going elsewhere, and perhaps further wage stagnation or even losing a job entirely. Not for most grunt-level employees, obviously, but with enough leverage, or enough collective action...
Like, I'm a department head, and me working hard for years has been integral to my store location being one of the top performers in the entire nationwide company for that department. How to quantify it though? Could I have 80-20'd it? Where was the cutoff of "working just hard enough to win various perks and favours from management, and score a few bonuses, but no more than that"? There's obviously value beyond just my own wages too: minmaxxing the department that generates the lion's share of both profits and customer traffic means I'm supporting all my coworkers as well. More hiring, more hours to go around during the slow season, more money to spend on capital improvements and morale-boosters. It sucks to work at a fly-by-night chickenshit operation! So even though I'd obviously love to be paid a commensurately larger wage to reflect all this generated value, it'd also feel wrong in some sense to selfishly "walk it back" after having already committed to being productive. I am not sure where the happy medium lies here.
Here's a tough question -- is it *rational* for Gen Z to compare themselves to the ultra-rich, and expect a larger share of the pie? Clearly 587k is not needed to thrive, but it's obvious that if one's personal target is a high income percentile, then this number will grow in proportion to income inequality and the target percentile.
AFAICT income inequality is growing, so that's consistent. And Zvi's claim is that Gen Z is more exposed to the lifestyles of the rich & famous, which would explain the rising target percentile (framed here as "expectations", which I think is a good framing). So that makes sense.
If you wanted to do something about it, you could lower income inequality, but that would be "socialism". Or, you could lower the target percentile. A lot of Zvi's advice here is fixated on lowering the target percentile. Cheaper housing, cheaper childcare, etc. so that people can achieve happiness without ultra-wealth -- these are good ideas, if all Gen Z wants is to "thrive". But if Gen Z wants "a comparable share of the wealth they see", it's less obvious how this helps.
It's easy to frame this in terms of Gen Z greed -- "if you have affordable housing and childcare, and you still want more because Mark Zuckerberg owns a 2,300 acre compound on Kuaui, then society is screwed". But I think that's a wrong way of framing it. It's not obviously wrong for people to see that compound and think it is a ludicrous waste. The argument that it's fine, actually, is not simple or obvious. And you could solve this problem by relieving him of the compound, and more generally reducing income inequality. So the "socialist argument" in that case is not nonsense!
I think the way Zvi is actually trying to reconcile these impulses is by reducing inequality in the use-value or marginal utility. Housing and childcare have a ton of value/utility, so if you can provide those to people then value-inequality will go down independent of wealth-inequality. So maybe Zvi is acting like "a bit of a socialist" with respect to the real value of important things -- that seems good to me.
Excellent analysis. One thing not discussed here is inheritance- it’s part of the challenge in that with increased life expectancy inheritance is coming much later in life, often well after the hardest squeeze of buying family homes and bringing up kids. But also what will happen when boomers do die, those expensive houses get sold (also freeing up the housing market), and much of the inheritance skips a generation as by then the kids of boomers have got sorted lives? Do these challenges start to unwind?
"Aella: being poorer is harder now than it used to be because lower standards of living are illegal. Want a tiny house? illegal. want to share a bathroom with a stranger? illegal. The floor has risen and beneath it is a pit."
In a way, these legal strictures are _worse_ than NIMBY. NIMBY tends to attack density, but forbidding low cost housing _anywhere_ puts people who are starting out, or who are recovering from a setback, in an even worse bind.
One general note about the effect of the rising requirements on fertility rates: The bind is worst in the most fertile years. Threaten CPS for sub-new-requirement care (hits worst for early, pre-public-school childhood) _plus_ the housing restrictions _plus_ all the other new legal requirements on people in their 20s? Yeah, I see why a lot of people who would otherwise want kids give up on them. ( As it happens, I'm childfree for other reasons (hassles, time sinks) so this didn't _personally_ bite me, but I see why it makes many people who would want kids give up. Now, in the USA I tend to think of low TFR as being third in line for worries, behind first AI effects, then climate change. For South Korea, on the other hand... )
Re:
"We could choose to, without much downside:
1. Make housing vastly cheaper especially for those who need less.
2. Make childcare vastly less necessary and also cheaper, and give children a wide variety of greater experiences for free or on the cheap.
3. Make healthcare vastly cheaper for those who don’t want to buy an all-access pass.
4. Make education vastly cheaper and better.
5. Make energy far more abundant and cheap, which helps a lot of other things."
I don't know what you mean by "vastly" or "far more". I'm used to Moore's Law versions of "vastly", meaning a 10X or better reduction in cost. Absent new technology: _Maybe_ minimal housing, with the legal restriction lifted could do this. _Maybe_ the purely human capital and skills part of education could do this, if online learning could be made to work better (but a large chunk of schooling is for credentialism, admissions sorting, enculturation/indoctrination, networking - to which online learning doesn't apply). I really doubt, with current technology, that any policy change could do better than _maybe_ 2X for (2), (3), or (5).
> Requirements has left an entire generation defining ‘success’ as something almost no one achieves, while also treating ‘success’ as something one needs in order to start a family.
I do not think the data support this: you appear to have combined this survey and another but they're very bad at that!
Very good analysis here! Especially like the part about the rising costs of childhood supervision, discussing that change could be entire book.
However, this, listed as a rising expectation, is simply a rising reality:
> 6. That old people have most of the wealth while young people are often broke.
For anyone our age (Gen-X) or younger, throughout our entire lives every major policy and demographic change have led to it: Medicare part D, ZIRP, Obamacare, implications of longer lifespans and aging population on SS outflows. Even things like the Cash-for-Clunkers program, on net, benefitted those who were established financially (older folks) at the cost of an 18 year old looking to buy a cheap first car.
Policy wise, everything came together to tilt in favor of the older, which is why average first time home buyers are now 40, which should be treated like an apocalyptic trend for long term social stability.
Youth is wasted on the young. Money is wasted on the old. This will NEVER be resolved.
It is great to see that you haven't forgotten how to be an economist!!!!
'Raise the status and social acceptability of living cheap and making sacrifices.'
I might be wrong, and I'm not going through the effort of finding out for sure, but I'm pretty sure I've seen you criticizing people praising the virtues of frugality. Sorry if I'm wrong, but at least that's the vibe you give off, for me.
I agree with everything in this post (including the above citation). I would have framed things differently, used different emphasis : Everything is increasingly routed through big, illegible Systems with inscrutable dynamics like governments, big corporations, complex interconnected world markets, Moloch-instantiating social media, etc ; not enough things are routed through Dunbar-level institutions anymore. I would characterize Rising Expectations and Rising Requirements as two examples of a general failure of our social institutions to keep up.
Dunbar's Number Of The Beast: Vatican Declares 150 Is Right Out
Not sure about an exact citation, but this is the blog that taught me to always think in terms of absolute rather than relative value, and also that I'm probably often making [small...rather large] mistakes by obstinately refusing to pony up small amounts of money when the time/effort/ugh field savings are large. Penny wise, pound foolish - value your time more highly, even if it means getting shaken down for a bluecheck or TSA Pre or whatever. So, yes, there's a bit of a tonal mismatch.
I think the key difference is that here, anti-frugality is classified more under a Requirement than an Expectation. That is, for life's biggest and most meaningful cost sectors, it's increasingly suspicious, illegal, and/or de facto impossible to make the frugal choices of yesteryear. Whereas saving the $20 that coulda been spent on a used microwave from The Salvation Army or whatever is a suboptimal choice one can still make in current_year. I think those are the kinds of superficially frugal, performatively virtuous sacrifices that Zvi (mostly correctly) tends to deride. They do affect affordability on the margin, but can only ever nibble at the edges of the problem, especially as costs for small-bore stuff overall continue to plummet. Like we won't solve affordability by "Living Off Beans And Rice Challenge" going viral, you know?
I'm not sure that's a fair reading of what Zvi is writing here. He says 'Raise the status and social acceptability of living cheap and making sacrifices', that's more about Expectations than Requirements.
He's talking about promoting of a different lifestyle, and this implies more than just praising those who make rationally cost-effective cut to their spending, and deriding others. It's necessary to respect the general aesthetics of a frugal lifestyle, even if you think some of the specific actions these aesthetics will suggest are not optimal.
Podcast episode for this post: https://open.substack.com/pub/dwatvpodcast/p/the-revolution-of-rising-expectations
Great article - quite topical and an area where your writing style / analysis I think is helpful. Have you done a deep dive on housing yet? I think that is one of the major angst points here that needs a bit more addressing. Scott Alexander had a nice piece on the "vibecession" the other day, but I am not sure really addressed this central issue sufficiently - hand-waved it away by noting that renters also feel unhappy about the economy.
There is a lot tied up in housing - perhaps more than I once realized - renting and owning are not as true trade-offs in practice as they are in theory. I guess this is what they call the "housing theory of everything".
It is both a consumption good, but also an "exclusive investment vehicle" that has made an entire generation wealthy even absent (hard work) and true savings. I did not fully appreciate that until spending more time out in California and realizing the depth & breadth of all the housing wealth that been created. When everywhere you look there is a $2-5M home that was worth 10x less a couple decades ago, that feels like many were handed a golden ticket that is now very difficult for the current generation - be the underlying issue interest rates or lock-in due to mispricing during COVID or regulatory restrictions on increasing supply.
It would be like if everyone in past generations made their wealth investing in Walmart or Amazon stock or something... and now all the most valuable companies are no longer in public equity markets during their early stages & all the gains are out of reach for the average person... hmmm...
People should watch pachinko or any other historical fiction that shows what poverty was really like.
This piece is superior to everyone else's most careful take on the topic, as well as your own previous entries in the series. If I wasn't already subscribed, this would do it for me.
Every generation’s number is a little unhinged, but that chart where Gen-Z needs ~$600k to feel “financially successful” genuinely scares me. One can’t help imagining the proletariat finally rising up and breaking their chains over the indignity of being forced to fly commercial to tropical getaways.
That aside, I realize a central theme of Mr. Money Mustache's (frugality and financial independence) blog, at least for the the last ten years, has been this spiritual Stoic push at its core to get people to try to appreciate the absurd material luxury we live in today while reigning in their Rising Expectations and finding hacks around Rising Requirements. Obviously not a cure for society at large (since it has too many words) but perhaps helpful for bookish types who feel trapped in rat races.
UPDATE: I've seen a few criticisms of the quality of the "Empower" survey, showing Gen-Z needs $587k to feel "financially successful".
The simplest takedown is that that same firm did a similar survey a year prior and found Millenials are the ones that said they needed $550k while Gen-Z said they only needed $130k(!)
https://www.empower.com/the-currency/money/research-financial-happiness
This is bad. Going to print with your results when you had such a wildly different results the year prior with no apparent attempt to understand why suggests they're deeply un-serious.
The finding was just too good to check.
Small and/or biased sampling is almost always the reason for these stupid surveys to be giving such dramatic numbers.
If you sampled people in SF then $600k makes sense. Hell, even $600k isn’t enough to afford an average American home in several parts of the Bay Area.
That actually makes a lot of sense - my eyeball-popping gut reaction to the graph was less the supposed Gen Z number, but that those of my own generation apparently asked for so little (and boy did we get it). That's not at all what I remembered from #Occupy and similar watershed Millennial moments! Weren't we supposed to be the spoiled participation trophy generation with vastly inflated expectations of effortless mastery due to The End Of History? Where'd this anomalously humble number come from?
Or perhaps affluenza is hereditary, heh...chalk one up for Bounded Distrust either way. And in line with the post, even if the exact numbers are iffy, that's still a clear signal of Something Was Wrong. (Which would have also been an appropriate archives link to include in this post, come to think of it...)
There is no mention in this analysis about having extended family to help with childcare and other expenses. If you go to school in the town where you grew up and live at home and eat with your family, education can be a lot less expensive. If you find the right partner in town, and decide to live next to your inlaws, they can help provide childcare. I think a LOT of immigrant families work this way, and they do make it work and they pass it along to the children to make it work again. It is the culture that pushes them out of the nest, by telling them to be "independent", but real independence only happens when you save enough money to have a backstop to current income,, or a job that is secure enough that you don't worry too much about being laid off
The other option that no one mentions is joining the military, which provides a LOT of support in a lot of ways, and teaches young people HOW to live by themselves. No one offers this up as a learning experience, which it definitely is. And it only costs a few years of your life for that education. Those who say that you are taking a chance on getting killed aren't looking at the actual numbers - relatively few service people are killed or severely injured in service these days, and the government takes care of those who are, and their families.
Children used to be considered a valuable resource to a family, because they could go off and do work and earn money. Now they are considered a fragile potential liability who will come back and haunt the parents forever, maybe killing them - but are still "precious", in spite of the potential liabilities. I don't think many couples about to get married discuss WHY they want or don't want kids, and come to some understanding about how they are going to raise them. They seem to be taught to think in the "here and now", and not think about the future. Maybe we also need to teach young people to think more about the future, than to just live in the present.
I'm impressed with Zvi's excellent prescriptive analysis of this societal issue. My ongoing concern is persuading a bipartisan majority of politicians to reevaluate citizens' needs, recognize that there's no one-size-fits-all solution, and then implement the right legislation with clear, practical directives, funding guidance, and mechanisms. If given the chance, I would definitely vote for political candidate Zvi Mowshowitz and similar candidates. So, then, perhaps, if he has the stomach for it...
> If given the chance, I would definitely vote for political candidate Zvi Mowshowitz and similar candidates
I mean, this is a big part of the problem itself. There's, oh...two and a half of us who would vote for any politician with a Zvi platform in any given geography. And empirically, if Zvi or Scott Alexander or anyone else like that actually decided they hated their lives and dedicated 2 years to running, they'd emprically get one of those 2.5 votes, because of vibes and aesthetics and everything else.
There's no road to "there" (good governance from politicians actually focused on outcomes with smart policies) from here.
If I had analyzed my previous comment from a discourse perspective like J.L. Austin's performative-constative dichotomy, my words might have sounded confusing. You probably agree that advocating for good governance and innovative policies isn't just limited to blogs. In terms of public image and aesthetics, while I've only seen Zvi present and answer questions on stage in Steamboat, Colorado, I didn't notice anything that seemed even slightly an automatic dealbreaker. There are also various roles, such as candidate, elected representative, advisor, or supporter. I aim to be a hopeful realist, believing that there's a district in New York—maybe just one—that could give Zvi a chance to share his ideas with a wider audience, either directly or indirectly, likely leading to increased citizen and voter awareness, positive reactions, and overall good feelings.
> I aim to be a hopeful realist, believing that there's a district in New York—maybe just one—that could give Zvi a chance to share his ideas
I would 100% vote for Zvi, or anyone with his platform. This is less a discourse thing from my end than a pragmatics thing - after all, even Libertarians, which are a much larger superset of this style of opinion and policies, only ever got 3.3% of the national vote at the highest, and generally cap out at 3-5% at Governor level votes.
Some L's have won actual City Council elections, and that's about where they cap out. I agree, it'd be awesome to see a Zvi or adjacent somewhere in politics, I just think in terms of "moving the needle on any problem that matters" they will be extremely limited in scope and impact.
Should we still try for that level of scope and impact? Absolutely! I will happily vote for any candidate of any flavor with thought processes and proposals like this.
But I think we can't realistically expect people of Zvi's talents to actually immolate their lives for a few years to have, *at best* after years of effort and upending their lives, a rounding error impact in a City Council somewhere, and that's the other part of the problem.
That said, we're definitely on the same side, and I too wish we had politicians even willing to parrot some of these ideas, they don't even need to originate them, and dream of a day and place where this is happening.
One useful thought experiment is to imagine that all of your listed policy solutions (make housing, childcare, healthcare, education, and energy vastly cheaper) and try to predict what the discourse will look like after that happens. If housing becomes a lot cheaper, I'd predict there are tons of articles about homeowners investments getting ruined, ruining retirement. When healthcare gets cheaper, we'll lament the loss of healthcare jobs. If energy and childcare get cheaper, we'll just switch to complaining about some other factor of life being expensive, like international vacations or handmade xyz. I think Yglesias hits the nail on the head when he points out that this is all downstream of money taking a larger importance in people's lives, as other meaningful things diminish in importance.
The missing key is productivity. If you worked twice as hard in an hour and produced twice as much and your wages stayed the same you'd be angry. Same if you invented a new process or learned a skill that doubles your output. While workers today aren't working twice as hard, worker output has risen considerably faster than wages. On a revenue basis it only takes a couple employees at s&p 500 companies to make a $1mil in revenue. Across the economy it's closer to 4. In 1975 inflation adjusted it took about 9, and even around 2000 it was close to 6-7. So workers today are way more productive, handling more complex and difficult tasks, but only earning a tiny bit more in wages. The majority of the benefit of our learning better skills, techniques, mastering technology, streamlining processes, and in some cases just working harder is: more money for someone else. Yes you make a tiny bit more, but again we've doubled our outputs per worker and wage growth hasn't caught up.
Yep, that’s how you are stolen from via currency debasement and inflation.
I do wonder what the Pareto-optimal amount of working harder vs increased wages is. Sometimes it's possible to work twice as hard in a totally invisible way that's not captured by any metric - like not just as one's own wages, but also not as meaningful additional profits, customer satisfaction and retention, etc. Other times those second-order effects are noticeable, especially at scale (if enough employees refuse to work harder, or work at all, that's a big deal!)...and in any moderately competitive industry, eventually that means business going elsewhere, and perhaps further wage stagnation or even losing a job entirely. Not for most grunt-level employees, obviously, but with enough leverage, or enough collective action...
Like, I'm a department head, and me working hard for years has been integral to my store location being one of the top performers in the entire nationwide company for that department. How to quantify it though? Could I have 80-20'd it? Where was the cutoff of "working just hard enough to win various perks and favours from management, and score a few bonuses, but no more than that"? There's obviously value beyond just my own wages too: minmaxxing the department that generates the lion's share of both profits and customer traffic means I'm supporting all my coworkers as well. More hiring, more hours to go around during the slow season, more money to spend on capital improvements and morale-boosters. It sucks to work at a fly-by-night chickenshit operation! So even though I'd obviously love to be paid a commensurately larger wage to reflect all this generated value, it'd also feel wrong in some sense to selfishly "walk it back" after having already committed to being productive. I am not sure where the happy medium lies here.
Here's a tough question -- is it *rational* for Gen Z to compare themselves to the ultra-rich, and expect a larger share of the pie? Clearly 587k is not needed to thrive, but it's obvious that if one's personal target is a high income percentile, then this number will grow in proportion to income inequality and the target percentile.
AFAICT income inequality is growing, so that's consistent. And Zvi's claim is that Gen Z is more exposed to the lifestyles of the rich & famous, which would explain the rising target percentile (framed here as "expectations", which I think is a good framing). So that makes sense.
If you wanted to do something about it, you could lower income inequality, but that would be "socialism". Or, you could lower the target percentile. A lot of Zvi's advice here is fixated on lowering the target percentile. Cheaper housing, cheaper childcare, etc. so that people can achieve happiness without ultra-wealth -- these are good ideas, if all Gen Z wants is to "thrive". But if Gen Z wants "a comparable share of the wealth they see", it's less obvious how this helps.
It's easy to frame this in terms of Gen Z greed -- "if you have affordable housing and childcare, and you still want more because Mark Zuckerberg owns a 2,300 acre compound on Kuaui, then society is screwed". But I think that's a wrong way of framing it. It's not obviously wrong for people to see that compound and think it is a ludicrous waste. The argument that it's fine, actually, is not simple or obvious. And you could solve this problem by relieving him of the compound, and more generally reducing income inequality. So the "socialist argument" in that case is not nonsense!
I think the way Zvi is actually trying to reconcile these impulses is by reducing inequality in the use-value or marginal utility. Housing and childcare have a ton of value/utility, so if you can provide those to people then value-inequality will go down independent of wealth-inequality. So maybe Zvi is acting like "a bit of a socialist" with respect to the real value of important things -- that seems good to me.
Excellent analysis. One thing not discussed here is inheritance- it’s part of the challenge in that with increased life expectancy inheritance is coming much later in life, often well after the hardest squeeze of buying family homes and bringing up kids. But also what will happen when boomers do die, those expensive houses get sold (also freeing up the housing market), and much of the inheritance skips a generation as by then the kids of boomers have got sorted lives? Do these challenges start to unwind?
Interesting post! Many Thanks!
"Aella: being poorer is harder now than it used to be because lower standards of living are illegal. Want a tiny house? illegal. want to share a bathroom with a stranger? illegal. The floor has risen and beneath it is a pit."
In a way, these legal strictures are _worse_ than NIMBY. NIMBY tends to attack density, but forbidding low cost housing _anywhere_ puts people who are starting out, or who are recovering from a setback, in an even worse bind.
One general note about the effect of the rising requirements on fertility rates: The bind is worst in the most fertile years. Threaten CPS for sub-new-requirement care (hits worst for early, pre-public-school childhood) _plus_ the housing restrictions _plus_ all the other new legal requirements on people in their 20s? Yeah, I see why a lot of people who would otherwise want kids give up on them. ( As it happens, I'm childfree for other reasons (hassles, time sinks) so this didn't _personally_ bite me, but I see why it makes many people who would want kids give up. Now, in the USA I tend to think of low TFR as being third in line for worries, behind first AI effects, then climate change. For South Korea, on the other hand... )
Re:
"We could choose to, without much downside:
1. Make housing vastly cheaper especially for those who need less.
2. Make childcare vastly less necessary and also cheaper, and give children a wide variety of greater experiences for free or on the cheap.
3. Make healthcare vastly cheaper for those who don’t want to buy an all-access pass.
4. Make education vastly cheaper and better.
5. Make energy far more abundant and cheap, which helps a lot of other things."
I don't know what you mean by "vastly" or "far more". I'm used to Moore's Law versions of "vastly", meaning a 10X or better reduction in cost. Absent new technology: _Maybe_ minimal housing, with the legal restriction lifted could do this. _Maybe_ the purely human capital and skills part of education could do this, if online learning could be made to work better (but a large chunk of schooling is for credentialism, admissions sorting, enculturation/indoctrination, networking - to which online learning doesn't apply). I really doubt, with current technology, that any policy change could do better than _maybe_ 2X for (2), (3), or (5).
> Requirements has left an entire generation defining ‘success’ as something almost no one achieves, while also treating ‘success’ as something one needs in order to start a family.
I do not think the data support this: you appear to have combined this survey and another but they're very bad at that!