Generation Debt, Paying Up?; A Normative Argument

The World

"It's a Hard Knock Life"Regardless whether the Western world or the entire planet face a melt-down (imaginary or not) over the next couple of years as a result of the crisis, a very real problem will stay: the massive accumulated debt that most Western nations face.  To make things even worst for the current younger generation which already faces bad prospects, (high unemployment, expensive education, rising living costs, to name a few) will see most of this debt passed down to it.  Maxed out credit cards, housing bubbles, low pension ages; at the end of the day it seems your grandmother and/ or parents should pick up the tab.  Since that is not going to happen maybe then, the generation afterwards could/ should.  What to do?

For one this generation can follow the example of the one before it, pass the problem along to the next.  However, this strategy faces a serious normative problem (besides the practical one), which I try to briefly address.  Passing on the problem ignores a series of different concepts related to responsibility.  The theoretical argumentation behind this is rather complex to be touched upon by a brief comment like this.  However, I would like to sum it up in three words: time to grow up. 

Societies accept concepts of responsibility as a way arranging tasks and objectives fairly, usually those who can offer/ deal with more have more of it; kids are less responsible than adults.  We consider it “fair” (another broad concept) that 5 years old kids do not pay taxes.  Adults who accept responsibility and act on it are deemed “mature”, thus we even attach social prestige to this action; a sort of social pat-on-the-back.   In fact we even applaud those who pick up the pieces of others for the larger majority, those who shy away we call immature.  This is one of those moments where we can either leave a massive problem/ responsibility for the next generation, sort of like children that brake the window and hide/ lie to the neighbours, or be adults about this and deal with it. 

This also relates to issues of accountability; at this point the younger generations cannot be held accountable for today’s crisis.  They are too young to have done anything significant to cause this, but passing down the problem will automatically mean a conscious refusal to act upon it and in turn make them accountable.  Perhaps the worst case scenario for this would be historical condemnation or some of us losing sleep at night; at least the more sensitive ones that do not have access to prozak.  However, it will also mean an entire generation will have refused to grow up.  Being a kid is fantastic but being an adult offers quite a lot more, in terms of experiences, the satisfaction of dealing with problems and more importantly shaping our own future rather than stoically waiting for it to pass by.

Accepting this responsibility will mean quite a few unpleasant policies but also pleasant ones.  For a start the bad news, in the short term saving up on government budgets will mean creating surpluses.  This will come initially from cutting expenses and investing in productivity.  Raising the pension age perhaps but also valuing education, innovation and health more than luxurious appliances and good make-up. 

A socialist utopia many will cry, wrongly however; no one likes one brand of cereal for life (and they should not, it’s insane!) however in the short term incentives must follow objectives and output targets.  That means using tools such as taxes to promote them.  In the long term, and this is perhaps the best part, this generation gets to decide what kind of a future it wants.  It gets to pick different values than the generation before it, going beyond the comfortable life with the early pension age, the credit cards and output targets. 

Many things can change over a generation, Western Europe was a war torn place today is rather prosperous.  This generation perhaps has an even better starting point; all it needs to do is simply grow up.


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