Perpetual Adolescence

The side show to under-employment and unemployment is not so “side-ish.” It’s the percentage of adults who either never left home, returned after college or even returned after later-in-life setbacks ranging from divorce to frustration in the job market. They’ve been called the “boomerang” generation or the new victims of a callous job market, where most of the new “opportunities” for entry level positons – regardless of education – hover around minimum wage employment. Add to this almost 1.2 trillion dollars of student loan debt, pressure to pay (with almost no recourse to bankruptcy) without the means to repay, and the situation gets downright ornery.

Back in 1980, kids couldn’t wait to get out of the nest. Those aged 24 to 34 living with parents or grandparents numbered only 11% of that cohort. DailyFinance.com, October 22^nd. But the numbers today are staggering by comparison. “According to a stunning Gallup survey… nearly three out of every ten adults in the United States under the age of 35 are still living at home with Mom and Dad. 

“This closely lines up with a Pew Research Center analysis of Census data that looked at a younger sample of Americans which found that 36 percent of Americans 18 to 31 years old were still living with their parents.  That was the highest level that had ever been recorded.  Overall, approximately 25 million U.S. adults are currently living at home with their parents according to Time Magazine.  So what is causing all of this?  Well, there are certainly a lot of factors.  Overwhelming student loan debt, a depressing lack of jobs and the high cost of living are all definitely playing a role.  But many would argue that what we are witnessing goes far beyond temporary economic conditions.  There are many that believe that we have fundamentally failed our young people and have neglected to equip them with the skills and values that they need to be successful in the real world.

“More Americans than ever before seem to be living in a state of ‘perpetual adolescence.’  As Gallup noted, one of the keys to adulthood is to be able to establish independence from your parents…” InfoWars.com, February 20^th. The burden of older children without resources to care for themselves often straps their parents’ retirement funding, consumption patterns and even their work habits.

Financial planners are now having to advise those who have to take care of their adult working-capable children into consideration in advising average Americans with limited capacities to address this unplanned burden. Stress levels rise, and following the advice from “tough love” financial advisors has to generate more than a few difficult moments and deep strains on familial relationships: “The overarching rule parents should follow for college kids returning home is that they are not running a retirement home for people in their 20s, says Ric Runestad, owner of Runestad Financial in Fort Wayne, Indiana. If the kids graduated from college, they should be either working full time or looking for full-time work, he says…

“How should parents handle the financial expectations for the living arrangement? Bill Demaree, owner of Demaree Retirement Services in Indianapolis, says parents need to establish an agreement with their kids that leaves nothing to interpretation. ‘You need to specify a lease with an amount for rent, a percentage of the utilities and how long the child can stay in the house,’ says Demaree.

“In addition, Runestad says he believes it's fine for parents to allow their kids to stay at home for a period even after the kids are employed to allow them time to build their savings. However, it's important for parents to collect rent. ‘This focuses your child's attention on the constant need to make their rent payments. A landlord doesn't care,’ says Runestad, about any extenuating circumstances that might arise. ‘They just want their rent money.’” DailyFinance.com. Hard and fast rules? Really?

Some have gentler advice: “Dan White, a certified financial planner with Dan White and Associates in Glen Mills, Pennsylvania, says kids should at least cover their own expenses, such as their car, auto insurance, and cell phone… [Joe Dadich, owner of Dadich & Associates in Troy, Michigan] tells parents to make a two-year plan that includes financial responsibilities and a chore list. He recommends a payment plan based on a percentage of their income that they can contribute for rent, their cell phone bill, student loans, and other personal expenses.” DailyFinance.com.

Grassroots advice is interesting, but what this phenomenon says about America and Americans is shocking. We have escalated the cost of college by a multiple of the cost of living while we have simultaneously reduced the opportunities for financial aid. Our 2005 revisions to our bankruptcy laws targeted students and student loans, cutting off that escape valve for most. We have saddled our kids with massive debt while cutting the once standard job-incentives of government investments in infrastructure repair and expansion, medical and scientific research andaccessible quality education.

We have lied to our children by telling them that if they study hard and achieve, success will be theirs. We have lied to ourselves – by relabeling clearly disproven “supply side” or “trickle down” economics as “incenting the job creators” – and fought to keep taxes low and reward those engaged in outsourcing of work to other countries (what “job creators” really do) or into a roboticized  and automated workplace. We have reprioritized our nation’s goals resulting in a severely contracting middle class, a staggering concentration of wealth at the top (based on a different set of regulatory enforcement and tax provisions heavily tilted towards incumbent wealth), a steady decline in average discretionary income and a skewing of economic wealth that makes us look like a banana republic.

Even our economic growth metrics – stock market and real estate prices and how we actually measure under- and unemployment – mask the underlying problems that cannot explain this little phenomenon of adult children living with their folks in record numbers. If we really were experiencing all that the-recession-is-over-recovery, then please tell me how those boomerang numbers got so bad?! America the brave has become America the short-sighted and heartless.

I’m Peter Dekom, and we have gotten so much better at lying to ourselves and trying to “slogan” our way out of this malaise than in actually dealing with the harsh reality that surrounds us.