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Deferred Futures: Why young adults can't hang on to what they earn

The San Francisco Chronicle
Sunday, January 15, 2006
Reviewed by Mary D'Ambrosio

If your child is in her 20s or 30s, there's a good chance you're wondering why she hasn't settled into a stable career, married or bought a house. It frustrates you to watch her lurch from job to job, endlessly retool in grad school and throw away money on overpriced rentals. Why can't she get serious?
But if you're that child, Tamara Draut offers comfort, and ammunition for your next dinner with your parents. In her convincing, impressively researched call to arms, "Strapped," she explains why your genteel temp gig masquerading as a job won't cover your outrageous housing costs, oppressive credit card bills, outsize health care premiums and payments on your five-figure student loan. And she gets that, with your boyfriend in the same boat, it'll be years before the two of you can swing marriage or the white picket fence.

"Today, most young adults are holding tight to the armrests, desperately trying and hoping to avoid a major crash during these first ten years," she writes.

Draut, who directs the economic opportunity program at the New York think tank Demos, tackled this study after falling into a desperate situation herself. One day at age 30, she and her husband, though both working, found themselves flat broke. As they ravaged their CD collection, looking for something to sell so they could buy groceries until payday arrived, it dawned on her that they were living way beneath society's, and their own, expectations. Between them they owed $57,000 in student loan debt and $19,000 in credit card debt. Draut wondered how two people who thought they'd done all the right things had been reduced to selling music for their supper.

"And we weren't alone," she wrote. "When we talked to people our age from all walks of life, it became clear that we weren't the only ones who were strapped."

In fast-paced, informative prose, amply supported by statistics, Draut argues that society and government have sold out young adults, weighing them down with crushing debts that prevent them from stepping into adulthood. It's a great read, though the anecdotes of struggling young people can feel dropped in, especially since names are often changed. And the author is overly fond of the silly sound bite: "The closest they'll get to the high life is opening a cold bottle of Miller," she writes in a typical quip.

Draut rejects the image of a self-indulgent generation that prefers to backpack across Europe or fill a wardrobe with designer clothes rather than build serious careers or put down roots. In fact, she argues, people ages 18 to 34 now are far more family-oriented than young people of the "liberated" 1960s and '70s. It's just that there are fewer opportunities to be an adult. This age group disproportionately holds the part time and temp jobs that now make up 33 percent of the American labor force. Some 33 percent of 18- to 34-year-olds lack health insurance, more than any other age group. Draut cites ample evidence to show that financial burdens are forcing the young to put off the usual benchmarks of adulthood: One survey found that debt was causing 14 percent of young adults to delay marriage, 20 percent to delay having children, and 40 percent to delay buying a home.

A major problem is the dramatic decline of government funding for college since the Reagan years, which Draut says has created "enormous student loan shackles that define young adults' entry into the real world." By 2000, 65 percent of college students left school in debt, up from 49 percent in 1992-1993, and more than one-fourth owed more than $25,000.

But she reserves special venom for the credit card industry: In her view, its victimization of young adults is downright Dickensian. Intense campus marketing programs and government deregulation in many states has allowed unlimited interest rates and fees, leading to effective lending rates of as high as 34 percent, "a rate of return," she says, "that the old neighborhood loan sharks wouldn't dare charge."

Draut mainly blames government, and her solutions center on government offering the young a bigger piece of the pie. But her argument comes with a rallying cry: Young people should bang their spoons on the table until they are served. Half of Congress, she notes, went to college for free on the GI bill. Rescinding the latest Bush tax cut could raise the $30 billion needed to ease students' pain by providing more outright grants that would lighten post-college debts. She can't understand why young people seem to silently accept such crushing burdens. "It's hard to believe we haven't taken to the streets to protest the economic injustice," she says.

Since this is a fair-minded work, Draut acknowledges that young people are partly to blame too. Raised in an era that revered self-reliance and free markets, they often fail to connect their personal stress with policy failures. They distrust institutions and one another, and vote in as low numbers as ever.

She chides young adults for checking out of politics "while the politicians have all but stolen our future." In a chapter that grimly analyzes this political retreat, she makes a frustrated demand: "My challenge to all [young people] is this: read a major newspaper regularly for one month." The young expect too little from society, she says, and too much from themselves.

Here there's a slight disconnect. Are today's highly educated young people (three-quarters now enroll in some type of college, and awards of grad school degrees are up nearly 60 percent over a decade) -- too dumb to know when they're being victimized?

Draut, unswerving in her call for the government to reallocate resources, doesn't consider a more uncomfortable equation: If just 20 percent of today's new jobs require even bachelor's degrees, as she points out, should society abet so much graduate school? If young people are really racking up $20,000 in credit card debt to attend their friends' weddings, as she suggests, could we instead downsize our weddings? In an era of unemployment stability, isn't it likely that most of us will be forced to lower our expectations?

Rather, Draut implies that there's a big pile of goodies out there and that young people deserve a heftier share.

"While our parents fought for civil and women's rights," she says, "we must battle against the economic inequity and lack of opportunity that now defines this country."

Mary D'Ambrosio, a former Associated Press correspondent in Latin America, teaches journalism at New York University.

This article appeared on page M - 1 of the San Francisco Chronicle