Luke Davis: Financial worries may be seed for unrest
This year has certainly been one for the history books. It seems like in all aspects of society we are more divided than ever before. Recently, this divide has manifested itself in silly debates about masks, garage pull-ropes, Russian Facebook ads, flag etiquette and statues of Columbus. While many of these things may seem unrelated, there is a common thread that I believe links all of these different areas of conflict.
I believe the real issue that plagues our nation is our growing distrust of “the system.” In the protests that have followed George Floyd’s murder, I have been particularly struck by the disdain many young people seem to have for our nation and its leaders.
While on the surface these actions by our youth appear to be ideological, I believe they are actually primarily economic. Today, many millennials find themselves saddled by debt, particularly student loan debt. Because their costly degrees have produced lower than anticipated incomes, many graduates are struggling financially.
According to a recent survey conducted by Clever Real Estate, the average college graduate expects their first year salary will be close to $60,000. This estimate is approximately 20% higher than the $47,000 median salary of bachelor degree holders with less than five years’ experience. These false expectations do not stop with how much they will earn. Millennials also underestimate how long it will take them to pay off their student debt. According to a 2019 study by Cengage, the average graduate believes they will pay off all student loan debt in six years, but in reality it takes closer to 20 years to pay them off.
These differences between perception and reality, have forced many to delay life milestones like moving out, starting families or purchasing homes. In my opinion, much of the unrest we are currently seeing is a direct result of the economic frustration many young people feel about their own situation.
However, rather than focus the blame on the decisions they made, it is “the system” that bears the brunt of their anger. If the economy continues on its downward trajectory, this resentment will only grow, as will the social unrest.
In large part, Donald Trump was elected because of these same systemic concerns. Many working-class people experiencing wage stagnation and high unemployment hoped an outsider might improve their economic situation.
Due to dissatisfaction in the current administration’s success in addressing these issues, I would guess another sweeping power shift in Washington is coming this November. If I’m right, I fear what will happen when once again politicians are unable to solve our society’s problems.
At the risk of sounding like Joseph McCarthy, the threat of communism is more real today than it has been in my lifetime. If you don’t believe me, just look at the recent autonomous zones set up in the Pacific Northwest. What is happening today is proof that this failed ideology has once again become popular in many circles.
I don’t mean to sound too pessimistic. I believe we still have the ability to right this ship. However it will require a return to the rugged individualism this nation was built on. We must go back to the belief that it is our actions and decisions that determine our fate. If we look to anyone, or anything else here on earth we will always be left disappointed.
(Past performance is no guarantee of future results. Advice is general in nature and not intended for specific situations)
Luke Davis is the director of operations and compliance at Stewardship Capital in Independence.