What will happen if the younger generation decides not to work as hard as their forbears, as they will not get their full rewards for working hard or for taking risks? If they decide to live on lower salaries (because good jobs are no longer available) and within their means (because cheap credit is no longer available), what will happen to the Ponzi scheme (read: Social Security) that the older generations now depend?
We know that most of the low income jobs out there do not provide medical benefits. Would it make sense for young Americans to consider leaving the United States for opportunities in better managed countries (with better social safety nets)? I'm beginning to think that it no longer makes sense for the average young American to limit his/her horizons to the United States. But what does this mean?
Let's say that someone of my niece's age decides to move to Canada. The Loonie (read: Canadian Dollar) has traded at near parity with the American Dollar during the past year, and is likely to do it again. Since nominal Canadian salaries are in the same dollar range as American salaries, it might make sense for a person who wants greater stability to leave the USA for the land of Tim Horton's Donuts and Coffee. Let's now say that the person wants to take greater risks for greater rewards. American ex-pats are doing very well in many places across the globe - as long as they are knowledge workers whose trades follow them around.
Right now, I don't think the United States will self destruct. But I think we must address these important issues:
- How do we pay off our debts without bankrupting our younger, and soon to be child-bearing generation?
- How do we provide this generation with enough opportunities, so that they can afford to have children (and reproduce above ZPG)?
- How do we provide this and future generations with the confidence they will need to prosper, whatever the world hands to them?
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