Imagine you’re 18 years old.
Your parents and career counselor have told you that, if you invest just $50,000 a year for four to six years, you’ll be set for life.
You won't only get a great house and career, but you’ll also have a shot at that ski chalet if you apply yourself.
Of course, you should follow your passion. So pick any degree, because when you hit the workforce, you’ll be judged on how well-rounded you are.
Your employer will sharpen your skills as part of their training program.
When you finish your loopie-doopie degree and start looking for a job, that $100,000-a-year starting salary is more like $60,000, and the training program’s been cut along with hiring.
You’re one of 200 candidates, of which more than half are overqualified.
The $200,000 investment in your degree was ultimately $300,000 with all those living expenses.
Your monthly tuition payment is $1,500 a month, and that’s greater than your share of the two-bedroom you’re splitting with two friends.
Even if mom and dad pick up the rent and school payments for you for the first couple of years, after a couple of promotions, you're still laid off along with 3% of the workforce —- including your Gen X mentors who gave 20 years to the company!
It turns out, your job can be done by someone in Manila or with AI — actually, both.
And you learn that companies have loyalty to shareholders and customers, not employees.
Fuck. This. Shit.
The only folks from your high school and college who got the homes were the ones who skipped college and did trade school, became firefighters, or who started their own companies.
Those with a tool belt are making $100,000 after seven years, plus their juicy overtime. They bought a great place an hour outside the city and their pensions and 401ks are growing massively as the market continues to rip.
The few startup founders in your generation have had big swings. Their net worth is seven or eight figures on paper, but — FUCK — they just sold four million in secondary sales and bought their loft.
Folks are having their second kid, and you’ve figured out that even if you go bankrupt, you’re still on the hook for $150,000 in student loans. Your guidance counselors and student aid reps told you that you would have paid these down by now.
Home prices are rising as fast as your job prospects are plummeting.
And your college keeps asking you to donate to their endowment because they're in a budget crisis, despite their coffers hitting 11 digits.
You moved out of the city to the boroughs, and now you’re thinking of moving home to regroup and pay down your debt.
You’re Not Wrong, But He’s Not Right
Now you meet a candidate who’s young, well spoken and says capitalism has failed you. That doesn’t feel wrong, it feels… SPOT ON!
We’re gonna freeze the cost of rent — it’s too damn high!
Government supermarkets will operate without a profit — my grocery bill is nuts!
We’re gonna add 2% to the taxes of the rich—stick it to them!
And that’s where we are at, folks. Our universities broke the contract that’s laid out in the American Dream, and now a well-spoken grifter is selling an absurd plan to an already broken city — my home town of New York.
You see, capitalism is going to do its thing no matter what the commie candidate promises you.
Cap rents? Investors stop building new houses and renovating the old ones.
State-sponsored grocery stores to put your local bodega out of business? They’ll run just as efficiently as the subway and the DMV!
Increase the top tax rate in NYC from 50.5% to 52.5%? Watch the business leaders move to Austin and Miami, where there’s too many home choices AND you’ve moved their savings from 12 to 15% on taxes — not to mention a cost of living that is -50%.
And heck, with all those savings, they can buy a jet card and visit New York City for the best 10 weeks of the year — when the Knicks are in the playoffs and the leaves are turning brown.
The solution is never socialism; it’s more competition (aka capitalism).
If you want to solve these problems:
Remove regulations and allow folks to build more houses.
Remove rent control so that more investors flood the space, as they have in Austin, Vegas, and Miami (over and over and over again, I might add).
If you want to use tax policy to change behavior, charge folks a tax for owning a home in NYC and not living in it. (Not my favorite idea, as investing in real estate drives more supply, but worth a discussion in the short term.)
Make student loan debt go away in bankruptcy, then watch lenders and their partners in crime (universities) change their offerings.
Be a better consumer and STOP going to universities for degrees that, in total, cost more than your first year of employment. i.e., if a degree is $60,000, then your first job needs to be $60,000 — if not, opt out!
And stick it to the corporations by brown-bagging it and refusing to buy stupid, overpriced items like $8 matcha and $25 sandwiches. Imagine what would happen to Starbucks if you all did what I do and made cold brew for $2 a gallon, using the same Contigo travel mug for six years.
Listen and Educate, Don’t Berate
At the end of the day, the folks at either end of the bell curve don’t fall for socialism. If you look at the people who are voting for stupid proposals, they tend to be the mid-wits: overeducated and privileged.
Cuomo did great with the working class and elites, but Mayor McChe did well with the virtue-signaling, frustrated “almost elites” — the hipsters who got suckered into the great, over-priced college scam.
We need to re-educate these midwits — and teach them to be founders of startups so they can work out their debt issues (and maybe even give them some grace so they can work their way out of debt).
best, JCal
jason@calacanis.com
Last one: Why We Don’t Talk About Job Destruction
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NAILED IT, J-Cal!