Changing Time
“And we said, this has only just begun.
In the end, time forever favors the young”
-Vallis Alps
The song Young, quoted above, inspired this writing. That line in particular struck me at first as true. At least, it has been true. Time has favored the young. I’m not sure that it does anymore, and I’m rather certain it won’t in the near future. Our relationship with time is changing.
As a teen and young adult, I would often wryly note that the most fatal ailment is being alive. Nothing is as certain to kill you as being born. Terrible pathogens be damned, life’s mortality rate is 100%. I don’t expect that will ever change. But our life expectancy likely will. First principle scientific reasoning says indefinite life, amortality, is inevitable. It’s not a matter of if but when. A world where people can live for as long as they can avoid accidental death does not obviously favor the young. We might still be a ways away from that world, but already the tide is turning against the young in other ways.
In the United States, older generations are the wealthiest the world has ever seen. A prolonged run-up in asset values, both real estate values and the values of virtually all investment assets has led the average boomer to have a net worth of over $1m. That’s the average. It’s not everyone. 40% of Americans don’t have the funds to cover a $400 emergency expense, including many boomers. So the variance is high. But the average is still a remarkable figure. Millennials and Gen-Z are faring less well.
Some millennials own homes and either bought them when interest rates were low or refinanced to a low interest rate. Unless there’s a crash in nominal real estate values, the one prophesy even the most doomsday-inclined tend to shy away from, those millennials are largely in good shape financially. They still have to make their payments, but if they do, most have between some and serious positive equity. Those who don’t own homes aren’t feeling as confident. Few people can now afford to buy the house they grew up in. So we rent. Our youth is not a folly, but the problem. We just haven’t had the time to save much, and real values of homes have more than doubled since our parents would have been shopping for their first homes. Time has not worked in our favor.
Older boomers are benefitting in classic fashion from compound interest. As with institutions, being older benefits you from the natural growth of wealth, assuming zero marginal productivity contributed. The difference between humans and institutions was that humans had to die while institutions could live on indefinitely. But if a person can soon live to 130, 150, 200, or even 500 years, imagine the wealth they can accrue.
That would be an odd world. It’s one we’re not ready for. For so long, the young have had the advantage of time. But if time no longer favors them, what will? When people can live indefinitely, it’s not clear that they will reproduce often if at all. Time has for eternity til now favored the young. What happens when that changes?
