Co-Editor of Naked Politics
In the wake of last year’s general election “youthquake”, the received wisdom was that Jeremy Corbyn’s vote-buying manifesto had beguiled a wide-eyed generation of electoral virgins. Polling data has since shown that analysis to be facile, but not before setting hares running at Conservative Party HQ. Fearing defeat in 2022 if not sooner, the Tories are now desperately searching for their own youth-centric marketing ploy.
Perhaps, a left-wing think tank has the answer? In their ‘Commission on Economic Justice’, the Institute for Public Policy Research (IPPR) highlights a growing intergenerational inequality and concludes that a £10,000 birthday present for every 25-year old would help to redress the balance. While it seems unlikely that a Conservative government might accept such a typically socialist conflation of inequality and injustice, Theresa May’s willingness to plagiarise Labour’s interventionist policy proposals does open the possibility. Even if May doesn’t run with the idea, it certainly wouldn’t be out of character for Corbyn to include it in his next manifesto. So, whether a state handout really could help to address the challenges that young people face is worthy of consideration…
Soaring House Prices
It is no revelation to point out that escalating house prices is the most significant challenge for iGens – the same happens to be true for non-property-owning Millennials, but they’re too old for us to worry about, according to IPPR’s arbitrary cut-off. In the circumstances, it is safe to assume that a deposit contribution would be gratefully received, but how would it affect the root cause of the problem?
The first rung of the property ladder is out of reach for so many because, for decades now, the supply of new homes has been surpassed by the demand that an unprecedented population growth has brought. There are two ways to reverse that trend; curb demand or increase supply. The former could be achieved by reducing birth-rates with the imposition of a Chinese-style one-child policy, by somehow shortening life-expectancies or by curtailing net immigration. None of which appeal. The latter, by direct state intervention with subsidies and fines or by removing barriers to building, like the restrictive land-use planning system. Supply-side reform. Now there’s an idea!
One thing’s for sure, providing a cash injection for an age group that typically struggles to raise enough for a deposit would increase the effective demand at the bottom end of the market, which is self-defeating in that it would also serve to push prices up. This is especially disadvantageous for the Millennials that don’t qualify for the leg up! For evidence of this, look no further than the existing Help-to-Buy scheme, which already offers a state-assisted route to property ownership while prices continue to climb.
While it is fair to say that overall living standards, wages and employment levels have never been higher, it is also fair to point out that accumulated wealth that once cascaded down the generations in the form of inheritance is now being depleted by lengthening periods of unproductive retirement. But would forcible redistribution be an ethical response?
Taken to it’s extreme, the collectivist ‘final solution’ was to kill off the members of society whose existence was deemed to be detrimental to the common good – for the many, not the few. As hyperbolic as that may seem, the ideology that has repeatedly led to such genocidal results always begins with the egalitarian promise of a kinder politics. The same is true here. The IPPR’s benevolent proposal is for the state to provide downtrodden young people with “their fair share” of national wealth. How lovely!
What they neglect to mention though, is that the wealth in question actually belongs to the individuals who created it, not to the ‘nation’. Before the state can play the role of benefactor, productive citizens must be dispossessed of their hard-earned nest eggs by threatening violent imprisonment if they refuse to cough up. Taxation, extortion; potayto, potarto. So, no, it is not a moral response!
Growing National Debt
One challenge that indisputably faces future generations is a legacy that we should all be ashamed of. Successive cowardly governments have prioritised their own popularity over fiscal responsibility, saddling our children with an exponentially mounting debt by popular demand. Yet again, this policy would worsen the situation. The proposed ‘Citizen’s Wealth Fund’ would only be partially covered by economy-stifling tax rises so the rest would have to come from further government borrowing.
Labour’s current brand of reckless generosity seems to have popular appeal, which suggests that votes are indeed for sale. Or worse, their leadership’s lifelong aim of “overthrowing capitalism” is much more fashionable than it should be.
Fortunately, though, there is evidence to suggest that the majority of 18-24 year olds recognised that the government both taxes and spends too much. So, maybe the young aren’t so idealistic after all and maybe it’s time for right-minded politicians to be a whole lot braver!