24 November 2017

Millennials are berated for avocados and lattes – but I suspect they’d rather have houses

How can we really heal the rift between young and old?

Of all the lessons the Conservatives should take from the 2017 election, one is stark: don’t piss off the pensioners. The number of voters aged 25-40 rose compared to 2015, while more of the Tory-leaning over-65s stayed at home. To put it crudely, Theresa May suppressed the grey vote with her dementia tax disaster; Jeremy Corbyn enthused social liberals, Remainers and people who can’t remember the 1970s. The result: a lost Tory majority.

There’s a similar story in the latest polling figures, which show the two main parties neck-and-neck overall. Opinium’s fieldwork from 14 November had a Labour lead of 25 points among 18-34-year-olds, 22 points among 35-44s, and 13 points among 45-54s. The counterweight to these is a Tory lead of 33 points among the over-65s.

What’s driving this dynamic? Earlier this year, the NS published a series of essays on the “new divides” in British politics that are sweeping aside the old class loyalties: open v closed, big cities v the rest, graduate v non-graduate, white v non-white, home-owners v renters. All of these intersect with the topic I wrote about: old v young. Older voters are more likely to be socially conservative, more likely to live outside cities, more likely to own their own homes and more likely to be white. They also come from generations with much lower rates of university attendance than today’s students.

All of that points to a widening chasm in British politics – not helped by George Osborne’s cynical decision to shield the Tory base, of which pensioners are a key part, from the truly sharp end of his austerity programme. Their incomes were protected with the triple lock, even as salaries stagnated and inflation slowly ate away at workers’ pay packets. Nearly three-quarters of over-65s own their homes, so low interest rates (or a paid-off mortgage) insulated them from some of the economic chill.

Among wonkish types, there is little argument that it’s time to rebalance government assistance away from pensioners and towards workers. In February this year, the Resolution Foundation found that after housing costs, a typical pensioner household is £20 a week better off than a typical working household.

The triple lock is a prime culprit of unfairness between generations, and also within them. A sobering report by the Work and Pensions select committee in February suggested that the only way to make it sustainable was to raise the pension age. This wasn’t just unfair to younger people, the committee suggested, but to those in areas with lower life expectancy who might never get to claim. (In the centre of Blackpool, the average man lives to 67.5; in affluent Westminster, to 92.9.) Undoubtedly, it was economically and ethically justifiable for the Conservatives to include ditching the lock in their 2017 manifesto; however, their lost majority is a strong incentive not to attempt anything so “brave” again.

To tackle intergenerational fairness, there are only two options: give more money to younger people, or take it away from older people. One of the reasons Labour did so well in 2017 is that Corbyn’s team did not present abolishing tuition fees as half of a zero-sum game. Instead, the necessary £11bn would come from policies such as higher corporation tax, increases in income tax for those earning over £80,000 and VAT on private school fees. Labour would not take from the old to give to the young.

Paul Johnson of the independent Institute of Fiscal Studies, who writes regularly about these issues, says that it’s important to stress that “nobody who happens to do well out of a house or a pension has done anything wrong, they’ve done the right thing and they’ve got lucky”. But he points out: “As a result of a series of accidents, you’ve got a world in which wealth has been concentrated in one generation.” Quantitative easing has benefited asset-owners; generous occupational pensions were designed based on life expectancy estimates that turned out to be hopelessly pessimistic; and the housing market dumped capital into the laps of those who bought at the right time. (Millennials are regularly berated for enjoying avocados and lattes, but I suspect they’d rather have houses.) This accumulation of capital squelches social mobility; the richest among the older generations can, in turn, smooth the lives of their children.

If the economics of this divide are clear, then the politics of solving it aren’t. Johnson notes that “there is much more inequality within generations than between them”, which makes fiddling with policy fraught with unintended consequences. Adam Drummond of pollsters Opinium says that there is strong support for keeping the triple lock among those aged 65+, while among 18-24-year-olds, the most common response is neutral or “don’t know”. In other words, by scrapping the lock, a party creates many new enemies but few new friends. “People personalise it,” he adds. “They think, my gran isn’t doing brilliantly.”

Housing is part of the solution – and not just in the way many people might think. Alex Smith, who runs community networks in Manchester and London, says that it’s important to look at how segregated our neighbourhoods have become, as the housing crisis drives old and young apart. “Where I feel the generations have become estranged from one another is in the lack of sharing time, laughter, experiences, relationships, everyday interaction,” he says. “That reduction of interaction – and therefore dialogue – occurs because of a shortage of mixed housing, lack of public squares, businesses that undervalue both youth and later-life experience, and a national culture and debate that stereotypes millennials and baby boomers as diametrically opposed.”

So there’s a free slogan for Jeremy Corbyn. Britain doesn’t just need socialism – it needs more socialising.