Some More Thoughts on Young Voters, Inequality, and the Republican Party
As a twenty-something who graduated at what was probably one of the least convenient times to do so of the last few decades, I wanted to elaborate a bit further on how I think changes in the nature of the US Economy are changing the way in which hiring works, and therefore creating problems that challenge the legitimacy of the current system even among those who by and large support capitalism and the free market.
As I argued in my previous piece, the heart of the problem with inequality is not that it exists, but that increasingly it seems to exist in a manner disconnected from effort and ability. Most people accept that those who work harder should make more money, and those who are smarter should be rewarded with greater success. Few, even on the left, have begrudged Steve Jobs or Bill Gates their successes, which they earned several times over. Where problems have increasingly begun to arise is that in a vacancies have increasingly been perceived to be determined by factors unconnected to hard work or pure ability at the same time that consequences of failing to secure one of them before graduation has become a life defining event.
On one hand the role of “connections” is not a new one, nor is it controversial. Most people have accepted that to one degree or another those who start out higher on the totem pole will likely have an advantage. But there has always been an unstated agreement with things like “connections”, or in the case of University Admissions, “legacy” status and Affirmative Action, that they will be used as tie breakers between effectively equal candidates.
What has increasingly begun to change however is two things. The first is the availability of jobs. Provided there were plenty of positions at banks, law firms, or other sources of employment, not getting your first choice was by and large unimportant. There were always other options, and given that there almost always a significant number of vacancies, it was hard to blame connections for a failure to achieve a position with a firm that was looking to fill 120 spots, or a promotion at a firm that wanted seven new partners. Maybe one or two were determined by connections, and another by affirmative action, but merit decided the rest.
Yet the matter is entirely different if there is only a single vacancy. Suddenly if it goes to someone with “connections” every other applicant “knows” that the decision was not made on the basis of merit. That almost the entire offspring of the Middle Class now attend four-year Universities and therefore have direct exposure and knowledge of individuals who are being hired on this basis means that it is also no longer hidden. It may not of mattered to a student at Cornell in 1955 that several of their friends got Wall Street jobs from friends of their parents, because that student, provided he was willing to work, was guaranteed a position of his own, and those who weren't were not in a position to observe the injustice. Both are no longer the case.
They are furthermore no longer the case at a time when the “rat race” is both starting earlier and is far more linear than it has ever been. A decade ago securing a position by graduation might have been desirable, but was by no means a requirement. In fact, it was considered typical to travel, join the Peace Corp, to do something before settling into a corporate job for several decades. This was not the case everywhere; in Europe, the pattern for decades has been to hire students into training schemes prior to graduation. Yet in America, where graduates are hired for full-time vacancy, a year or two of experiences used to be considered an asset. No longer. Now leading finance and consulting firms increasingly rely on on-campus recruitment, meaning anyone with ambitions in those fields not only needs to start looking for internships early, likely in freshman year, but is out of luck if they fail to secure a position prior to graduation.
They are out of luck, because with companies increasingly hiring students before graduation, they have developed a stigma against graduates, who increasingly are marked as failures for their inability to secure a job before leaving university. The internship programs recent graduates used to flock to are increasingly either closed to graduates, or discriminate against them. All of this assumes of course that a prospective applicant is at a “good enough” school to even be considered; those unlucky or unskilled enough to end up at schools which are not targeted for on-campus recruitment a particular firm are for all practical purposes of the running from the very beginning. They are free to send in resumes to the spam folder of the HR department.
Today to lose out on a vacancy as an undergraduate is not a temporary setback; it is a devastating event that may change an individual’s entire career trajectory, and reduce their earnings potential for decades if not a lifetime. A student who made a final round interview at McKinsey will likely find something; but the economic and social trajectory of the life they will live will diverge incredibly from the individual who received that position. The new hire at McKinsey will be making six figures with a year or two. The runner-up, if they are lucky and have wealthy parents, will work an unpaid internship in New York or DC before being hired for 40K. If they are unlucky and lack money, they may well move in with their parents and work retail.
Much of the discussion of the decline of the middle class in America has focused on the disappearance of skilled manufacturing jobs. But that has been ongoing for decades, and largely effects individuals who are close to retirement anyway. Far more dangerous in the long-run is the increasingly wide gap between success and failure, a gulf that is increasingly approaching the size of the Grand Canyon with social class increasingly being determined at age 22, with that determination becoming increasingly difficult to alter the fact.
Knowing the consequences of a near miss today would be a torment in any case, yet if that near miss was the result of factors that are illegitimate, frustration can easily turn to anger or depression. This is increasingly what is happening among young Americans. It is not that they resent inequality; most would happily switch places with the rich, and their ambition is not to create a more just and equitable society but to reach the top. But they do not see themselves as any less capable, any less hard-working, or any less deserving of wealth and success than those who have it, because the rich and successful are increasingly their ex-peers. Yet if they have a problem with capitalism, it is not that it is unfair, but that it is unfair to them, and this difference, small as it may seem, creates an enormous gulf between them and the Left.
That gulf exists because under the Obama Administration, the Democratic Party has increasingly become the party of those who are successful under the existing system. Barack Obama is symbolic of the American meritocracy as it existed in the 1990s and early 2000s. A poor boy from a mixed-racial single-parent household who went to Harvard and made good through hard-work, Obama is, at least to himself, proof that the system can, and at least sometimes does work. While Obama may advocate to better the lives of the less fortunate, he does not, and cannot see them as equals, since if they were, they too would have succeeded. Harvard admitted him, the members of the Law Review chose him, and every Law Firm in the country tried to poach him. For him to question the integrity of his admission, whether or not he was the hardest working or the most capable applicant to apply to for his spot at Harvard Law School, is to question the very basis of his identity. Obama and his supporters have therefore retreated in a world where success correlates with ability, and the Administration has sought to identify itself with those who have been successful in other fields; technology, Hollywood, finance, academia, and law.
The Republican Challenge
Entering the 2012 campaign, Republicans were not unaware of the liabilities Barack Obama should have had with many younger voters. Paul Ryan made a direct effort to appeal to their frustrations with his reference to fading Obama posters in their parent’s basements. Yet if Ryan identified a problem for Democrats, he and his party uniformly failed to identify or offer any sort of solution. If Obama’s cultural and personal outlook revealed the myopia of the meritocracy of the 1990s, the GOP’s economic platform revealed that the party remained the party of aging white voters approaching retirement, with a focus on tax cuts, and a hostility to “socialism” and anything that smacked of “redistribution” to “moochers”.
It was not the 47% comments themselves that caused the Republican party trouble with the new generation. Few of those I have described consider themselves poor and even those who do want to be rich. The problem for the Republican party however, is that they have by and large given up on the idea they ever will be rich, and they are probably right. Someone who feels they should be wealthy, yet is not, and knows they never will be is likely to be far less willing to accept the economic hierarchy of society than someone who is poor and never had any expectations of being anything else. The latter may imagine themselves with money, but largely in the same way many fantasize about winning the lottery. The former by contrast see the system and its organization as fundamentally unjust.
Responding to this anger should in theory be easier for the Republican Party. Democrats are committed to racial and gender preferences which are perceived as worsening this economic transformation, regardless of whether they actually do or not. Republicans by contrast have no such commitments and at the point that many of those preferences target groups that don’t vote Republican, like Asian Americans, there is a major opening.
Yet in order to exploit it beyond the obvious approach of attacking Affirmative Action, which appears in any case as a pander to the party’s white base, the Republican party has to change its approach to the market. The goal of the Republican party is not economic evangelism; the party does not exist to praise the wonders of laissez faire, and the great work of the “produces”. Rather the purpose of the Republican Party is to defend the market against its enemies, and the foremost threat it faces is from people who while accepting it can make some people rich, do not believe it can make them rich. Towards that end, Republicans need to invest effort and capital in making the market work.
This is easier said than done, and I cannot claim to have all the answers. Many of the problems are organic, a consequence of the realization by many companies during the recession that the European system of recruitment made more sense. There is, however, one place where Republicans can influence the situation, namely the field of higher education. Costs for higher education have skyrocketed at the very time that success in securing a position before graduation has become vital, yet there is no incentive for schools that have already received their tuition bills to succeed in placing students. If the British approach to loans, where no payment is due until a graduate earns a certain amount of money a year, and are forgiven entirely if they reach age forty without doing so, were to be adopted with the schools on the limb for part of the defaulted loan, colleges and universities would be a lot more invested in placing students. This is especially true for Law Schools, where hundreds of schools continue to charge more than a hundred and fifty thousand dollars for membership in classes which have a sub ten percent employment rate.
That is only the start. Ultimately, as I will elaborate on later, for the market to work, money must circulate, and therefore the Pro-Market position for the Republican Party will be that of fighting the threat of aristocracy which today exists more within the fake meritocratic vision of the Democratic party than within the misplaced backlash populism of the Republican base.