The Next America

PREFACE

Once you get far enough along in life, you’re likely to be struck by the distance between the views in front of you and the ones you can still dimly make out in your rear-view mirror. I turn 65 this year. The America of my childhood—with its expanding middle class, secure jobs, intact nuclear families, devout believers, distinct gender roles, polite politics, consensus-building media—is nothing like the country my year-old granddaughter will inherit. Our political, social, and religious institutions are weaker, our middle class smaller, our cultural norms looser, our public debate coarser, our technologies faster, our immigrant-woven tapestry richer, and our racial, ethnic, religious, and gender identities more ambiguous. As a society, we’ve become more polarized and more tolerant—and no matter what we’re like today, we’re going to be different tomorrow. Change is the constant.

We’re also getting a whole lot older, as is almost every other nation on the planet—the fruits of longer life spans and lower birthrates that are each unprecedented in human history. These new demographics of aging mean that pretty soon we won’t be able to pay for all the promises we’ve made to oldsters like me. So we’ll have to either shrink their social safety net or raise taxes on their children and grandchildren. This reckoning has the potential to set off a generation war, though it doesn’t have to.

This book applies a generational lens to explore the many ways America is changing. It pays particular attention to our two outsize generations—the Baby Boomers, fifty- and sixty-somethings having trouble coming to terms with getting old, and the Millennials, twenty-somethings having trouble finding the road map to adulthood. It looks at their competing interests in the big showdown over entitlement reform that our politicians, much as they might try, won’t be able to put off for much longer. It also examines how the generations relate to one another not only as citizens, voters, and interest groups, but as parents, children, and caregivers in an era when the family itself is one of our institutions most buffeted by change.

I don’t presume to know how my story ends. Years ago when I was a political reporter I had a weakness for trying to forecast election outcomes. I was about as reliable as a coin flip. Eventually it dawned on me that the future was going to arrive anyway, unbidden by me, and that prediction was something of a mug’s game. The only forecasts I’ll venture in this book will be about the future we already know—the parts baked in by the demographics and the data. Mostly my aim is to be a tour guide who explains how our nation got from the middle of the last century to the present, then provides some insights about what this breathtaking journey tells us about the changes yet to come. I’ll conclude with some thoughts on how to renegotiate the social compact between the generations on equitable terms for all.

Be forewarned: There are a lot of data in this book. Numbers are the coin of the realm at the Pew Research Center, where I’ve worked since we opened our doors a decade ago. Our staff is a mix of public opinion survey researchers, political scientists, demographers, economists, sociologists, and ex-reporters like me. We call ourselves a “fact tank” and we’re fond of the aphorism attributed to Senator Daniel Patrick Moynihan: “Everyone is entitled to his own opinions, but not his own facts.” We think good data make good facts, and we’re just idealistic enough to believe that a common foundation of facts can help societies identify problems and discover solutions.

We know, of course, that numbers aren’t omniscient. And we’re aware that public opinion surveys, in particular, can sometimes convey a false certitude that disguises ambiguities of heart, soul, and mind. If you ask Americans whether they favor more assistance to the poor, 65% will say yes. If you ask them whether they favor more spending on welfare, just 25% will say yes. Which finding is “true”? Probably both. “Do I contradict myself?” Walt Whitman once asked. “Very well then, I contradict myself. I am large, I contain multitudes.” I sometimes wonder whether he had a peek at our survey findings.

But while we’re well acquainted with the limitations of survey research, we also appreciate its value. In the shout-fest that passes for public discourse these days, politicians and pundits frequently claim to speak for the public. Opinion surveys allow the public to speak for itself. Each person has an equal chance to be heard. Each opinion is given an equal weight. That’s the same noble ideal that animates our democracy.

1

Introduction

DEMOGRAPHIC TRANSFORMATIONS are dramas in slow motion. They unfold incrementally, almost imperceptibly, tick by tock, without trumpets or press conferences. But every so often, as the weight of change builds, a society takes a hard look at itself and notices that things are different. These “aha” moments are rare and revealing. One occurred on November 6, 2012, the night of President Barack Obama’s reelection victory in a campaign that, given the political headwinds stirred by four years of high unemployment, he had every reason to lose.

Instead he won, and rather handily, an outcome that caught a lot of smart pundits and pols by surprise. Republican operative Karl Rove succumbed to a live, on-air mini-meltdown on Fox News that night when he couldn’t bring himself to accept the finality of the people’s verdict. Michael Barone, the conservative analyst and longtime coauthor of the Almanac of American Politics, who probably knows more than anyone else alive about voting patterns down to the county and precinct level, had only a few days earlier predicted an Electoral College landslide for Mitt Romney. So had George Will, the eminence gris of the op-ed pages. As the scope of the Obama victory sunk in, three of the most animated conservative voices in the media—Dick Morris, Bill O’Reilly, and Rush Limbaugh—drew the same conclusion. “This is not your father’s United States. This is a United States with a permanently high turnout of blacks, Latinos, and young people,” said Morris, who had also forecast a Romney blowout. “The white establishment is now the minority,” said O’Reilly. “We’re outnumbered,” said Limbaugh.

Their demography-is-destiny despair arose from some pretty compelling arithmetic. Had the election been held only among voters ages 30 and older, Romney would have won by 2 million votes instead of losing by 5 million. Had it been held only among men, he would have won by 4 million votes. Had it been held only among whites, he would have won by 18 million votes. Romney carried the white vote by the identical 20 percentage-point landslide that George H. W. Bush had run up among whites a generation earlier. That haul netted the elder Bush 426 electoral college votes in 1988 and Romney just 206 in 2012. So in the 24 years separating those two elections, whites lost more than half of their electoral college clout. Aha.

The voters in 2012 were the most racially and ethnically diverse in our nation’s history, a trend driven mainly by the tens of millions of Hispanic and Asian immigrants (and their children) who’ve come across our borders in the past half century and are now showing up at our polling places. But this new multi-hued electorate is actually a lagging indicator of the nation’s demographic transformation. In 2012 some 26% of voters were nonwhite—a record—but so was 37% of the population as a whole. Even with their turnout gains, nonwhites still punch well below their weight on Election Day. Many are still too young to vote, many aren’t citizens, and many aren’t politically engaged. Over time, a mix of demographic and behavioral change is likely to shrink all of these deficits. The US Census Bureau projects that nonwhites will become the majority of the US population in 2043, and by that time, it’s a good bet that their voter participation will have closed the gap with their population count.

Romney captured just 17% of the nonwhite vote in 2012, leading one wag to refer to the GOP as the “pale, male, and stale” party, and the Republican leadership itself, in a notably blunt official postelection autopsy, to acknowledge that it too often appears to be a “narrow-minded” collection of “stuffy old men.” Elder statesman Bob Dole weighed in with a suggestion that his party hang a “closed for repairs” sign on its front door, and former Florida governor Jeb Bush lamented, “Way too many people believe Republicans are anti-immigrant, anti-woman, anti-science, anti-gay, and the list goes on and on.”

The GOP’s demographic predicament calls to mind German playwright Bertolt Brecht’s puckish advice to his government when it faced similar troubles: dissolve the public and elect a replacement. Political parties can’t fire the voters, of course, so they adapt—or try to. Ever since the electoral shock of 2012, Republicans have been engaged in an intra-party civil war, which reached a fever pitch when their congressional Tea Party faction shut down the government for 16 days in the fall of 2013 in an unsuccessful bid to defund Obama’s signature legislative accomplishment, the Affordable Care Act. The GOP needs to get past this destructive infighting, and if it wishes to be a party that is competitive in future presidential elections, it also needs to figure out how to become more appealing to the nation’s newly diverse electorate. In the meantime, if history is a guide, the demographically ascendant Democrats—now winners of the popular vote in five of the last six presidential elections—have no guarantee of smooth waters ahead. They may find themselves hurt by having to dispense harsh medicine in an age of austerity. They may discover their multiracial base has fissures. Or that the troubled launch of Obamacare creates turbulence for their candidates in 2014, and perhaps beyond. The most reliable rule of American politics is that nothing is static. The pendulum swings.

Figure 1.1

The Changing Face of America, 1960–2060

Note: Data labels not showing if less than 5%. White, black, Asian and “all other” include only non-Hispanics who identify as a single race. Hispanics are of any race. Asians include Native Hawaiians and Pacific Islanders. All other includes American Indians/Alaska Natives in all years and those who reported two or more races beginning in 2000.

Source: Pew Research Center historic population estimates for 1960–1990 (Passel and Cohn, “US Population Projections: 2005–2050,” Feb. 11, 2008). Census Bureau population estimates for 2000–2010 and projections for 2015–2060

This book will keep an eye on these partisan dynamics, but its main ambition lies elsewhere. Using a generational frame, it aims to illuminate the demographic, economic, social, cultural, and technological changes that are remaking not just our politics but our families, livelihoods, relationships, and identities. These shifts have left no realm of society untouched. As a people, we’re growing older, more unequal, more diverse, more mixed race, more digitally linked, more tolerant, less married, less fertile, less religious, less mobile, and less confident. Our political and media institutions have become more polarized and partisan; so has the public itself. Our economy is producing more low-wage and high-wage jobs, but fewer in between. Our middle class is shrinking. Our median household income has flatlined. Our social class divisions are wider than they’ve been since the Gilded Age. Wealth gaps between young and old are at levels never before seen in modern times; so are the economic divides between whites, blacks, and Hispanics, and so, of course, is the gap between rich and poor. Our neighborhoods have become more integrated by race but more segregated by income. And more sorted by party. Women have become more economically independent, men less. Gender roles are converging, both at work and at home. Marriage is in decline. The nuclear family is losing its pride of place. The fastest-growing household type in America contains just one person. Not far behind are multigenerational households, in which two or more adult generations live under the same roof, often because that’s the only way to make ends meet. More than 4 in 10 newborns have an unwed mother. Half are nonwhite. A teenager has less chance of being raised by both biological parents in America than anywhere else in the world. Young adults are taking longer to grow up; the middle-aged longer to grow old; and the elderly longer to depart this vale of tears. Biases against minorities and gays are diminishing. Today’s immigrants—nearly 9 in 10 of whom are not Europeans—look very different from the previous waves of settlers and immigrants who created America. But when it comes to embracing what we think of as traditional American values, it’s hard to find more fervent devotees.

Some of these changes are for the better, some for the worse—and some people no doubt will differ over which is which. Most are mutually reinforcing. And all, in one way or another, will have an impact on the immense national challenge that’s the central focus of this book: namely, as our population ages, how do we keep our promises to the old without bankrupting the young and starving the future? When we built the social safety net in the twentieth century, the math was easier. We had more workers per retiree, fewer people living to be very old, an economy that seemed to generate new jobs on autopilot; and health care costs that hadn’t escalated beyond control. The politics were easier, too. Back then, except for the gray hair and crow’s feet, young and old pretty much looked and thought alike. No more. Our older generation is predominantly white; our younger generation increasingly nonwhite. They have different political philosophies, social views, and policy preferences, as they made clear in 2008 and 2012, when the young-old voting gaps were the widest on record. Many of the young are big government liberals; most of the old are small government conservatives (but hands off Social Security and Medicare!). The young are comfortable with the dizzying array of new lifestyles, family forms, and technologies that have made the start of the twenty-first century such a distinctive moment in human history; the old for the most part are disoriented by them. The young are the least religiously connected generation in modern American history; the old are the most devout believers in the industrialized world. The young have been starting their working and taxpaying lives in the worst economy since the Great Depression; the old are finishing theirs off having run up $17 trillion in government IOUs that their children and grandchildren will spend their lives paying off. “Mugging Our Descendants,” is how a headline on a George Will column toted up the math.

It sounds like the script for a fiscal horror flick, pitting parent against child in offices, hospitals, legislatures, and homes. In the concluding chapter, I’ll argue that the drama doesn’t have to end in tragedy. If the generations bring to the public square the same genius for interdependence they bring to their family lives, the policy choices become less daunting and the politics less toxic. But this optimistic scenario is by no means preordained. Social Security and Medicare are the most popular, successful domestic programs the federal government ever created. They are a profound expression of the idea that as a nation, we are a community, all in this together. For the best and most compassionate reasons, Americans of all ages oppose reducing benefits to the elderly. Yet as our population grows older and these programs consume an ever larger share of our federal budget, they pose increasingly difficult questions of generational equity. Today’s young are paying taxes to support a level of benefits for today’s old that they themselves have no realistic chance of receiving when they become old. Meantime, the cost of these programs is crowding out investments in the economic vitality of the next generation—and the entire nation. Rebalancing the entitlement programs to adapt to the demographic realities of the twenty-first century will be a massive political challenge. Even more, it will be a test of social cohesion at a time when our generations are divided by race, politics, values, religion, and technology to a degree that’s rare in our history.

The story is best told through the prism of the two big generations with competing interests: the Baby Boomers, who’ll be crashing through the gates of old age in record numbers for the next two decades, not nearly as well fortified financially for the journey as they’d hoped; and the Millennials, twenty-somethings who have landed back in their childhood homes in record numbers because they haven’t been able to get launched in a hostile economy. In the pages ahead, you’ll also meet the Gen Xers, who are navigating middle age with mounting economic anxieties about their own old age; and the Silents, the oldest and most financially secure of our four adult generations, but also the cohort most unsettled by the pace and magnitude of social change.

LONGER LIVES, FEWER BABIES, MORE IMMIGRANTS

The fundamentals of our demography are these: in 2014, about 4 million Americans will be born, roughly 1 million will arrive as immigrants, and about 2.5 million will die. “Generational replacement” is the demographer’s term of art for the population change produced by this churn. In some eras the process can be relatively uneventful, but not so in the America of the early twenty-first century, when young and old are so different from each other. Of the myriad forces that bear on these numbers, none has been more inexorable or important than the rise in human longevity. Advances in health care, nutrition, and sanitation have increased life expectancy at birth in the US from 47 years in 1900 to 62 years in 1935 (the year Social Security was enacted) to 79 today to a projected 84.5 by 2050. In the first part of the twentieth century, most of the gains came as a result of improvements in the survival rate of newborns; in the second half, most gains came from medical advances that have prolonged the lives of older adults. And there’s more to come. While it sounds like the stuff of science fiction, some biomedical researchers believe that by mid-century, bionic bodies embedded with computer chips and fortified by as-yet-uninvented medications will make life spans of 120 or more years attainable, perhaps even commonplace. If so, just imagine the quality-of-life issues—to say nothing of the retirement finances!—that future generations will need to sort out.

Longer life spans beget lower birthrates. As living standards improve and people grow more confident that their children will survive to adulthood, succeeding generations reduce the number of children they have. In the twentieth century, the world’s population grew by nearly fourfold. In this century, however, it is expected to grow only by about another 50% before eventually stabilizing at roughly 10 billion.¹ Over the long haul, this is good news for all who worry about the sustainability of the earth’s resources. But in the short and medium term, it can create social, economic, and political dislocations, especially in countries like the US that have large cohorts entering old age and smaller cohorts in the workforce. However, all of our biggest economic competitors face even more challenging age pyramids. China’s median age will rise from 35 now to 46 by 2050, surpassing the projected median of 41 in the US. Germany’s will be 52. And in Japan, where birthrates have been among the lowest in human history for the past generation, the market for adult diapers now exceeds the market for baby diapers. Japan’s median age will be 53 by 2050. If present trends continue, there won’t be nearly enough Japanese youngsters to care for its oldsters, which helps explain why Japan is the global leader these days in the development and manufacture of caretaker robots.

One way for nations to prevent the economic sclerosis that can occur when their populations age is to replenish their workforce with immigrants. In this realm, the US boasts the world’s most enviable demographics. The third great wave of immigration to the US, which began when Congress reopened America’s doors in 1965, is now more than 40 million strong. Based on current mortality-fertility-immigration trends, roughly 90% of the growth in the US labor force between now and mid-century will be from new immigrants and their children. Immigration waves always produce political and cultural backlashes; this one has been no exception, especially since more than a quarter of the modern-era immigrants are living here illegally. As columnist Fred Barnes has written, we have a history of hating immigrants before we love them.² But no nation has been better served than ours by immigration, and judging by the tens of millions of people from all over the world still clambering to come here, there’s every reason to expect our long winning streak to continue.

RACE AND RELIGION

The modern immigration wave has done more than boost our economy. It has given us a racial makeover. Until the middle of the last century, our racial checkerboard was white with a smattering of black. Now it’s multicolored, and whites are on a long, steep slide toward losing their majority status. Moreover, in today’s America, our old racial labels are having trouble keeping up with our new weddings. More than a quarter of all recent Hispanic and Asian newlyweds married someone of a different race or ethnicity; so did 1 in 6 black and 1 in 11 white newlyweds. Not too long ago these marriages were illegal and taboo; now they barely raise an eyebrow. As these couples procreate, what race will society call their children? What will the children call themselves? For centuries we’ve used the “one-drop rule” to settle such questions—if you’re not all white, you’re not white at all. Going forward, we’ll need a more nuanced taxonomy. America isn’t about to go color-blind; race is too hardwired into the human psyche. But race is becoming more subtle and shaded, and most Americans (especially the young) are at ease with the change.

As noted, the new rainbow America has had a big impact on presidential politics. There’s an interesting history here. After he lost the Hispanic vote in 1980, Ronald Reagan described Hispanics as “Republicans who don’t know it yet.” Three decades later they apparently still haven’t figured it out. To the contrary, they’ve grown even more Democratic. In 2012, 71% voted for Obama (up from the 56% who voted for Jimmy Carter over Reagan in 1980), as did a record 73% of Asian Americans. Block voting is nothing new among minority groups in America; blacks have supported Democrats by even more lopsided margins for generations. But these new patterns are ominous for the GOP. Hispanics and Asians today compose 22% of the US population; by 2060 they will make up nearly 40% (while blacks will remain constant at about 13%). They embrace values common to immigrant groups—they’re hardworking, family-oriented, entrepreneurial, and freedom loving—all of which, as Reagan rightly observed, could easily make them natural Republicans. Yet they also favor an active government and tend to be social liberals. And many have been put off by the anti-immigrant rhetoric of the GOP in recent years. “If we want people to like us, we have to like them first,” said Bobby Jindal, the Indian-American Republican governor of Louisiana, after the 2012 election. The growing partisan divisions by race and ethnicity coincide with the growing schisms by ideology and age. These deep divisions aren’t healthy for the polity; they’re especially perilous for the Republicans, who find themselves on the wrong side of the new demography.

Race isn’t the only demographic characteristic changing before our eyes. Religion is another. In 2012, for the first time ever, not one of the four major party candidates for president and vice president was a white Anglo-Saxon Protestant (one was black, one Mormon, two Catholic). Nor was the Speaker of the House (Catholic), the majority leader of the Senate (Mormon), or any of the nine justices of the US Supreme Court (six Catholics, three Jews). WASP dominance of our nation’s political institutions pretty much peaked at the opening bell in 1776, when 55 of the 56 signers of Declaration of Independence were white Protestants. It has been falling ever since, and the pace of decline has ramped up in the half century since John F. Kennedy became the first non-WASP president in 1960 and Congress was still three-quarters Protestant (as opposed to 56% now). However, it’s not just that the American public is becoming less white and less Protestant—it’s also becoming less attached to religious denominations in general. A record 1 in 5 American adults today—and fully a third under the age of 30—is religiously unaffiliated. Of these so-called “nones,” roughly a quarter describe themselves as atheists or agnostics; the remainder believe in God but have no religious affiliation. The US is still the most religiously observant nation among the world’s great powers. But led by today’s young, it’s growing more pluralistic and less connected to traditional religious institutions.

A HOLLOWING OF THE MIDDLE

For the past decade and a half, America’s middle class has suffered its worst economic run since the Great Depression. It has shrunk in size, fallen backward in income and wealth, and shed some—but by no means all—of its characteristic faith in the future.³ Median household income in this country peaked in 1999 and still hasn’t returned to that level, the longest stretch of stagnation in modern American history. As for median household wealth—the sum of all assets minus all debt—it has fallen by more than a third since peaking at the height of the housing bubble in 2006. Not surprisingly, an overwhelming share of Americans—85%—say it has become tougher to live a middle-class lifestyle than it was a decade ago. Yet most middle-class Americans say they have a better standard of living than their parents had at the same stage of life (the economic data bear them out) and a plurality expect their children will do even better than them. The trademark optimism of the American middle class may not be as robust as it was a decade ago, but it hasn’t disappeared. It may, however, not be as well founded as it used to be.

This hollowing out of the middle has been accompanied by a sharp rise in income inequality. One standard measure is known as the Gini Index, which ranges from 0 to 1, with 0 representing perfect equality (everyone has equal income) and 1 perfect inequality (one person has all the income). In the US, the index rose to .477 in 2012 (the latest year for which such data are available) from .404 in 1980, an increase of 18%.⁴