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Trading Lessons

Youth Unemployment - The Disgrace of Sacrificing a Generation

Economics / Unemployment Oct 09, 2014 - 10:41 AM GMT

By: Raul_I_Meijer

Economics

Would you like to know how bankrupt our societies are? Financially AND morally? Before you say yes, please do acknowledge that you too ar eparty to the bankruptcy. Even if you have means, or you have no debt, or you’re under 25, you’re still letting it happen. And you may have tons of reasons or excuses for that, but you’re still letting it happen.

Our financial and moral bankruptcy shows – arguably – nowhere better than in the way we treat our children. A favorite theme of mine is that any parent you ask will swear to God and cross and hope to die that they love their kids to death, but the facts say otherwise. We only love them as far as the tips of our noses, or as far as the curb. That means you too.


While we swear on our mother’s graves that we love them so much, we leave them with a world that lost half of its wildlife species in 40 years, that can expect to make coastal areas around the globe uninhabitable during their lifetimes, and a world that is so mired in debt just so we can hang on to our dreams of oversized homes and cars and gadgets that all there will be left for them are nightmares.

But I always wanted what was best for them! Yeah, well, you always chose to not pay too much attention, too, and instead elected to work that job you hate and keep up with the Joneses and tell yourself there was nothing you could do about it anyway other than a yearly donation to some socially accepted charity in bed with corporations (you didn’t know? well, did you try to find out?)

You elected leaders that promised to let you keep what you had, and provide more of the same on top. You voted for the people who promised you growth, but you never questioned that promise. You never wondered, sitting in your home, the size of which would only 100 years ago have put aristocracy to shame, what would be the price to pay for your riches.

And you certainly never asked yourself if perhaps it would be your own children who were going to pay that price. Well, ‘Ich hab es nicht gewüsst’ has not been a valid defense since the Nuremberg trials, in case you were going for that.

The fact of the matter is, we can continue our lifestyles, best as we can, because we are able to make our children pay for it. We allow ourselves to continue to kill more species, at home but mostly abroad, because we never get in touch with any of those species anyway. Other than mosquitoes, which we swat. We can drive our 3 cars per family because we only see the ice melt in the Arctic on TV.

And we allow ourselves, and our governments, to get deeper into debt everyday, because we’ve been told that without – ever – more debt we would all die, that debt is the lifeblood of our very existence. We don’t understand what it means that our governments increase their debt levels by trillions every year, and we choose not to find out.

That’s a matter for the next generation; we’re good with our oversized flatscreens and coal powered central heating and all of that stuff. We are better off than the generation of our parents, and isn’t life always supposed to be like that?

Which brings us back to your kids. Because no, life is not supposed to be like that. Not every generation can be better off than the one before. In fact, you are the last one for whom that is true. It’s been a short blip in human history, let alone in the earth’s history, and now it’s over. And you must figure out what you’re going to do, knowing that not doing anything will make your sons and daughters futures even bleaker than they already are.

Europe Sacrifices a Generation With 17-Year Unemployment Impasse

Seventeen years after their first jobs summit European Union leaders are divided on how to create employment and a fifth of young people are still out of work. At a meeting in Milan today Italian Prime Minister Matteo Renzi plans to tout the new labor laws he’s pushing through. French President Francois Hollande will argue for more spending, a proposal German Chancellor Angela Merkel intends to reject. Britain’s prime minister David Cameron isn’t coming.

Their lack of progress may increase the frustration of ECB President Mario Draghi’s calling on the politicians to do their bit now and loosen the continent’s rigid labor markets even if that means facing the ire of protected workers. “An entire generation is being sacrificed in countries such as Spain,” economist Ludovic Subran said. “That has a real impact on productivity in the long run.”

How someone can talk about “a real impact on productivity” in the face of millions of lost and broken lives is completely beyond me. You have to be really dense to do that. And they pay people like that actual salaries.

When EU leaders met in Luxembourg in November 1997, the soon-to-be-born euro zone’s unemployment rate was about 11%. Jean-Claude Juncker, then prime minister of the host country, now president designate of the European Commission, promised a mix of free-market solutions and government plans would mean a “new start” for young people. Today the jobless rate is 11.5%. The Milan summit will focus on youth unemployment, which afflicts 21.6% of people under 25 across Europe, according to Eurostat. Even this number is almost identical to 1997, when it stood at 21.7%.

Average European youth unemployment numbers may not have changed much since 1997, which is bad enough, but plenty numbers did change. The young people of Greece, Spain, Italy and Portugal were not nearly as poorly off 17 years ago as they are today. That’s what the eurozone project has accomplished.

The leaders “need to discuss meaningful job creation,” Subran said. “It’s about avoiding the neither-nor situation of people being out of both work and school. This means providing jobs in the short term and training to improve skills and employability in the long term.” In February 2013, the EU allotted €6 billion ($7.6 billion) for youth-employment initiatives between 2014 and 2020, with the bulk of the spending in the first two years.

The centerpiece of the initiative is a “Youth Guarantee” that anyone under 25 should have either a job, apprenticeship, or training program within four months of leaving formal education or becoming unemployed. The initiative focuses on regions with over 25% youth unemployment, which is the whole of Spain, Greece, and Portugal, all but the north-east of Italy, about half of France, and a few regions of eastern Germany.

Lofty words. But nothing has come of them in many years, and nothing will. Politicians vie for the votes and campaign donations of the parents, not the children. Until the children are the majority block, but by then present day leaders will be gone.

Germany is opposed to discussing new spending until already allotted sums have been spent. Instead, Merkel’s government has stressed liberalization of labor markets as the best path to create jobs. France and Italy argue they are already taking steps to loosen their labor markets and those efforts won’t work without a background of growth.

Italy’s proposed rules, opposed by some lawmakers from Renzi’s Democratic Party, aim at making firing easier while providing a new system of income support for those who lose their job. European employment did improve after 1997, with the unemployment rate bottoming between 2007 and 2008 at 7%, and 15.7% for young people, as a credit bubble boosted growth in Spain and Greece.

It ballooned during the subsequent financial crisis. “I’m worried how the euro zone has detached itself from the rest of the world economy,” French Prime Minister Manuel Valls told business leaders in London Oct. 6. “If there is no strategy to support growth at the eurozone, we will be in even greater trouble.”

The only solutions in the minds of the leadership are reforms (make it easier to get rid of the older people and let the young do their jobs at half the price) and growth. Both of which have failed for all those years, but that’s all folks so they press for more of the same. Who cares about the young until they can unseat you?

The present leadership selects for a future in which they – and theirs – will still be the leadership. It’s only natural. Any victims made along the way there are seen as necessary collateral damage. Reforms and growth. Reforms being break down what generations of workers have built up in rights. Fighting squalid working conditions and miserable low pay. Think about that what you like.

But growth? What if there is no growth? Hey, even the IMF just said growth won’t return to levels of old. And then called for more reforms. But what lives will your children have if growth is gone, and what are you prepared to for them is it is? How are you going to soften the blow for them? How much are you willing to sacrifice for your children lest they be sacrificed by society?

One last thing: it seems obvious that we teach our kids the wrong skills. Or there wouldn’t be so many unemployed or in low-paying jobs. So if we want our kids to get a job, what should change in our education systems? Now, I must be honest with you, I’ve found our education so bad ever since I was even younger than I am now that I up and left.

I simply noticed that it was meant for people happy to be pawns in someone else’s game, and I knew that wasn’t me. Colleges and universities mold people into usable – not even useful – ‘things’, provided there is no independent thinking going on. Because that kills the entire set-up. It’s all been an utter disgrace for decades.

But this is not about me. The question is, what are we going to teach our kids? Well, with our present power structure, it will be a mere extension of what there is today. The overriding idea is that tomorrow will be like today, just with more of the same. That’s all we know, and all we have. And that’s what keeps our leaders happy too: a world in which they feel they can be safely settled into their comfy seats. Progress while sitting still. Don’t think I’m right? THink about it.

So would do you think the consensus would be when it comes to education? I think it would be having our kids be managers, lawyers, programmers, the same things that are ‘in’ today. More of the same, just more. But is that so wise if even the IMF says growth will never be the same it once was? What if things get really bad? What skills will they have that can help them through times like that?

Shouldn’t we perhaps teach our kids basic skills first, just in case? So they can grow and preserve food, build a home, repair machinery, that kind of thing? And only after that deal with the fancier stuff?

We have become utterly dependent on the ‘system’. Is it a good idea for our kids to be too? We lost our basic skills – or at least our parents did – at the exact same time that ‘growth’ became the magic word du jour. The idea was that we didn’t need them anymore, that other people would grow our food and take care of all the other basic necessities for us.

But what if that was just a temporary bubble, and it’s gone now? The data sure point to it. In that case, should we rush to move back our sons and daughters to the skillset our grandparents had?

By Raul Ilargi Meijer
Website: http://theautomaticearth.com (provides unique analysis of economics, finance, politics and social dynamics in the context of Complexity Theory)

© 2014 Copyright Raul I Meijer - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
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