And because Illinois Issues is based at a university, I witness an ever-changing stream of young men and women flowing through the campus and our offices. I can’t help but think how different the world is for them than it was for me — gulp — 40 years ago. Despite the youthful exuberance of Baby Boomers who wanted to make the world a better place for our children and now our grandchildren, I don’t believe we have.
The last thing I want to write is a reminiscence of “the good old days.” For one thing, they weren’t always good, especially for minorities or women or foreign immigrants. Racism, sexism and xenophobia were more prevalent everywhere, not just in the South. We were embroiled in a war that nobody understood — most of all, the soldiers whose patriotism bound them to follow our leaders, even when they were led into a small, seemingly insignificant country that had endured decades of civil war. Their mission was to stop the spread of Communism in the jungles of Vietnam. They couldn’t. In the end, it didn’t matter much, anyway.
What did matter, though, was how that war, along with a petty burglary at the Watergate Hotel that resulted in the resignation of a president and the imprisonment of many of his top staff, left a generation disillusioned and distrustful of authority — especially of the government. Maybe that’s why the subsequent years unfolded as they did. Maybe not.
I was my grandchildren’s age in the 1950s and early 1960s. America was basking in its post-World War II glow, and the manufacturing sector spawned by the war industries was booming. There was a broad middle class: Most fathers — and sometimes mothers — could find jobs that paid enough to buy a home and raise a family. I didn’t know anybody who was considered enormously rich; I also didn’t know anyone who was crushingly poor. The doctors and lawyers and bankers in the small Midwestern town where I grew up lived well enough to have nice houses and well-built automobiles and modest summer lake cottages, and they didn’t worry about being able to afford to send their children to college. But they didn’t live in palaces in gated communities on the edge of town. Many of the companies where our parents worked were locally owned, and whether through good will or simply good business, they helped support their communities in ways other than wages.
That era truly was characterized by hope. Hope that children would end up better educated and better off than their parents. Hope that parents could improve their own situations through hard work. And for the most part, it worked. It’s not that people didn’t struggle; they did. But in general, the hope and belief was that the struggle would produce something better.
I was the current college students’ age in the late 1960s and early 1970s. There was enormous turmoil over Vietnam and civil rights and the women’s movement. But as the war wound down and those movements began to make real inroads, hope and opportunities still existed in the minds of most of my generational compadres and me. We still were able to find decent jobs and buy houses and raise children. Our situation really wasn’t much different from that of our parents, except many of us were indeed better educated and eventually likely to be a little better off. Nearly every decent job had good health insurance, and most employees still had pensions.
The erosion began in the 1980s, although it didn’t seem that way at first. Companies began offering 401(k) plans as a supplement to their defined-benefit pensions. At least that’s the way it was sold. A typical employer’s 401(k) match was one-half of the employee contribution up to, say, 10 percent of the employee’s salary. So if you contributed 6 percent of your salary to a 401(k), the company would put in 3 percent. At retirement, you could expect a pension, plus the proceeds of your 401(k) investments plus Social Security. Altogether, it would provide for a comfortable post-work lifestyle.
HMOs emerged at about the same time. Much simpler than filling out forms for health insurance companies and then paying 20 percent of whatever medical service was provided. As long as your doctor joined the health maintenance organization, you just plopped down an inexpensive co-pay, and that covered you all the way through, say, heart surgery. At least that was the way it was sold.
Pensions and health benefits. Few really thought much about them then. They were part of most employment packages. Employers that didn’t offer them often found themselves with high turnover and lower quality employees because the good ones would soon leave for greener pastures.
That’s no longer the case.
Maybe unions became too greedy. I knew workers at a large, unionized truck plant who planned for a strike before contract negotiations had even begun — we always strike, I was told. That truck plant is now shuttered. Maybe employers got too greedy. Top management salaries soared into the stratosphere, and stockholders — including our own 401(k) managers — demanded nearly impossible short-term returns. Maybe it was the emergence of the global economy. Middle-class American workers couldn’t compete with their overseas counterparts who were earning sweatshop wages and were generally happy to get them.
Most likely it was a combination of all of those factors, along with a trickle-down economic theory that ultimately didn’t trickle and the worst recession since the Depression. The result was a gradual, at first almost-imperceptible, decline of that broad middle class in which I grew up and expected would never erode. Salaries and pensions and health benefits and, most of all, jobs began to disintegrate or disappear. Employers at first canceled their employees’ defined-benefit pensions, and when times got tougher, stopped matching their workers’ 401(k) investments, which already were losing ground as the stock markets tumbled. Health insurance costs for employers and employees alike climbed in multiples of the rate of inflation, and out-of-pocket expenses and maximums on coverage for HMOs and other plans ate into salaries that already had been slowly stagnating for 30 years.
Now, despite an upturn in the stock market, the jobs that my generation took for granted will be hard for many current college students to find. Even for those who do find work, it’s much less likely that company-financed retirement or health insurance plans — benefits that were automatic when Baby Boomers entered the work force — will be part of the package. If those trends continue, the outlook for jobs and retirement benefits and health insurance for my grandchildren is even bleaker.
The current battle between state government workers and their employers — elected officials and taxpayers — over jobs and wages and pensions and health insurance is among the last in the fight over the future of the middle class. As I listen to the war of words, and especially when I scan reader comments posted on online news stories about those issues, my impression is that the middle class life that Baby Boomers once considered almost automatic has morphed in today’s minds into some sort of “Cadillac” existence. And that instead of public outrage over that decline, the prevailing sentiment is schadenfreude: glee over someone else’s misfortune.
And I can’t understand why many more of us aren’t mad as hell about that.
Illinois Issues, April 2013