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Comment by untog | Hacker News Reader

This is interesting to me because (as a 30 year old) it never occurred to me that I would be more prosperous than my parents. I'd like to be, of course, but it seems alien to me that there was an era where that was all but guaranteed. It doesn't matter, except that it explains where a lot of this older generation's resentment of "the youth" comes from - they haven't faced the situation we face, so the only way they can make sense of us not succeeding is that we're simply not trying. When that generation is a large voting bloc, that poses a problem.

(That said, I suspect most of us HN readers will not be poorer than their parents. Tech is an area of boom in an economy of bust, after all, so factor that in when reading responses on here)

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Not kidding here, but one of the most helpful things my Dad ever told me as a teenager was "You probably won't have the same standard of living as we've had while you were growing up" because he made good money in a specialized, unionized profession. He saw, first-hand, how his employment and skills were being cheapened not by competition, but by globalization mentalities, which, in his words (paraphrased) "Isn't about bringing them up, but bringing our standard of living down." Oh, and his ever present suspicion of "management" which, history eventually proved true, wanted to take money from his profession and give it to themselves and "investors" - which did happen (I won't go into details but it was staggering).

It was through these discussions and sharing of perspective - just one man's view of the world - that I was taught to value health, happiness, and appreciate a life not defined by the materialism that could've been a real sink-hole for me if I'd tried to achieve even greater "status" than he did.

Just to put a last bit of context on it, every five years of so my parents would think about getting a used Corvette convertible, but they could never justify what seemed like such a wasteful purchase...by comparison, my Dad drove a 1991 Ford Ranger pickup, purchased new, babied as a second vehicle, until eventually selling it with 80,000 miles on it for 3x the book value sometime around 2010.

I'm a big-time car guy and have dreamed of a Lamborghini Countach since forever. But now, having lived in the "real world" for over a decade, I'm just happy to have a nice 4-banger Toyota with good air conidtioning, tinted windows that gets 30 mpg when I keep my foot out of it. Looking at 2008, all I can think about is how greed is a terrible, toxic basis for a value system.

The earning power of the emerging asian middle class has doubled in the last 20 years. If that's not "bringing them up" then what is?

To stay on my initial point, a situation where the Asian middle class grows and the US middle class has not eroded in the past 20 years would be an appropriate example.

Frankly, I don't buy the story of an eroding American middle class. A stagnating one maybe. But there just isn't data to support the idea of a regressing one.

People look at the past with rose colored glasses.

Yes, there is data in support of a regressing middle class in the US and it can be most easily seen in the labor force participation rate and the hourly wage "underemployment" demographics of the working class under the age of 35. I mean, if you want to deal in beliefs, then you can believe whatever you want. Speaking of rose colored glasses, a "doubling" of the Asian middle class in the past 20 years doesn't strike me as much improvement if we start talking about the hard numbers and population % still living in abject poverty.

1) The labor force participation rate is declining primarily due to an aging population. And even with the decline it's still much higher than it was at any time before the mid 80s (primarily due to women entering the workforce).

2) The % of the world living in extreme poverty has declined dramatically in the past half century.

http://www.vox.com/2015/8/13/9145467/extreme-poverty-global-...

The story of the last 50 years is really about members of the western middle class finally having to deal with competition from the rest of the world due to globalization. While this has certainly had some downsides for the western middle class it has been an INCREDIBLY HUGE BOON for everyone else. It's very hard to overstate how fast east asia has transformed from poverty to relative wealth and how good this has been for hundreds of millions of people.

Go look at a picture of what Shanghai looked like in 1990 vs today: http://gizmodo.com/5558350/shanghai-skyline-before-and-after

> Speaking of rose colored glasses, a "doubling" of the Asian middle class in the past 20 years doesn't strike me as much improvement if we start talking about the hard numbers and population % still living in abject poverty.

But it's a massive improvement if you talk about the numbers who were living in poverty and now aren't.

Much progress. Much yet to do. Both are true.

http://www.pewglobal.org/2015/07/08/a-global-middle-class-is... seems to mention otherwise.

Having seen the changes over last 20 years in India, the middle class is now a lot vulnerable and in the fix with absolutely zero safety net. The earning power of the middle class might have doubled but the expenses and the standard of living has increased manifolds, thus pushing them further to the bottom.

I'm 40 and way poorer than my babyboomer parents. My savings got wiped out in a housing market crash in 2008, they have made over half a million euro in their lives just from their houses becoming worth more over time.

They've also both had work most of their adult life, and their pensions funds have always done well on the stock market, whereas my wife has been without a job since the financial crisis hit and government in the Netherlands went in austerity mode.

Similar story here. I cashed out a lot of stocks to make a down payment on a house. Then I had to move to a different city to find work, and lost everything I ever put into the house. I timed the market just right to lose everything, because my other options were to lose more than that.

I have had more employers in 15 years of work than both of my parents accumulated over a combined total of nearly 80 years. I have never, ever been promoted within the same company, but I have been summarily tossed to the curb for no individually-attributable reason--along with several of my office-mates--a total of four times.

I have a lot of envy for what the Baby Boomer generation already got, and in combination with the condescending attitude they have (in aggregate) towards the younger generations, it fuels a lot of resentment.

Their formula of education plus hard work equals success has not been even remotely accurate for me. Education plus hard work equals screw you, buddy, because I already got mine. Enjoy your layoffs and unaffordable housing and tuition increases well in excess of inflation and slashed employer-granted benefits and mountains of political debt, because your parents have decided to sell their house at 20x what they paid for it, buy a plush RV, and split their well-funded retirement between any convenient US state and Snowbirdland, Mexico.

And what really kills me is that I have never seen anyone from my parents' generation working particularly hard. Maybe they did all that before I was born, and just coasted along afterward? Maybe I don't really know what hard work looks like?

Well, anyway, thanks for all the inter-generational tension, Boomers. We'll air it out by having Thanksgiving dinner at your house again this year, because none of your kids can afford homes big enough to hold everyone.

Genuine question: why not rent out the house whilst you were in the other city? That would have probably covered the mortgage and got you out of the dip until you could either move back, or the market had picked up again and you could sell without loss.

> We'll air it out by having Thanksgiving dinner at your house again this year, because none of your kids can afford homes big enough to hold everyone.

That and we can't afford to have our own kids...

May I ask what your savings were in that caused them to be be wiped out in 2008? I would have to guess retirement funds invested in mutual funds which were invested in the housing bubble?

We bought a house for 300k, about 60k of it our savings and 240k mortgage. In the next two years, the value of the house went down by 60k.

To be honest that wasn't _all_ our savings, and they were already spent on the house of course, but it was a financial loss equal to most of our original savings.

If the house was your primary residence, and not an investment instrument, you didn't really "lose" anything - other property is now also cheaper, and you always need somewhere to live.

Sure, you're paying more than you would have if you waited, but you were happy to pay XXXXUSD per month to have somewhere to live, and your relative mobility has actually increased if we assume that the housing market fell by a flat percentage.

I think the problem is when you finally do need to move, and you owe 200k still but will only be able sell the house for 150k. You'll still be making mortgage payments on a house you won't even have then.

Real estate markets are a fickle beast.

After the 2008 crash, I was planning on moving, but abruptly changed my plans when I lost close to a 80K on the value of my home.

Fast forward 6 years and suddenly the market was showing signs of rebounding. I had always been in contact with my real estate agent, but I was considering a large scale remodel and staying put where I was. My agent offered to start looking for something that I might like.

A year later the process went shockingly fast. I was assuming the house would sit for a while since the market was still pretty soft. I cleaned and de-cluttered my house and it went on the market. Within hours I had two listings for the next day - which ballooned to four the morning of. When I got back, I had two offers. The house was on the market less than two days.

I credit the ability to sell my house and make a few grand on it to my agent. It was priced and marketed really well by him and his company. This is the second house he's sold for me. The other house was on the market at the height of the housing boom and sold in less than a week.

Just because the loss hasn't been realized yet doesn't mean it isn't real. Among other things, prior commenter can't move to a different house because s/he no longer has a downpayment and won't be able to refinance to take advantage of lower rates. An increase in housing values is real, and so is a decrease, and it's real even before those losses/gains have been realized by selling (for instance, a HELOC can get the gains out before selling).

In particular my wife has no job now and mortgage lending rules are much stricter now. So although we can make the payments on our current 240k mortgage each month on my income, the maximum mortgage we could get now is something like 180k.

Assuming that I will always move on to another own house, and not a rented one.

I'm never buying again. If they want me to sink 30 years of my life into monthly payments, I'm going to need a job that will last for at least 30 years of steady paychecks.

And I don't believe those actually exist any more.

Also, I no longer trust the justice system to protect my rights as a property owner. Having been primed by software-based DRM to not want to buy something unless I can truly own it, I find that land property in the US is often heavily encumbered with covenants, regulations, local ordinances, mortgage terms, and recurring taxes, to the point where it feels like paying rent and signing a lease feels less restrictive.

> I'm never buying again. If they want me to sink 30 years of my life into monthly payments, I'm going to need a job that will last for at least 30 years of steady paychecks.

I don't get this. If you rent instead, you'll just be sinking monthly payments into that (maybe more, maybe less than with buying).

And there's no need for a job that lasts 30 years, you just need to keep the ability to make the payment every month. But that is also true when renting.

You don't understand, because you have probably just done the math on paper, rather than lived it.

Anecdotally, I have realized more value per dollar spent on rented homes than on purchased homes. If I had never purchased a home in the past, renting instead, I believe without a shred of doubt that I would have a greater net worth today.

I cannot make a rational case for home purchase now, because I cannot guarantee so many years of steady paychecks within an acceptable commuting radius of any home I could buy. Look back 30 years before now, to 1985. How many jobs existed then in the U.S. that no longer exist now? Do you think you can predict what the job market will look like in 2045?

If your job was to make buggy whips, would you feel safe making a 30-year financial commitment in 1890? Perhaps, but the Ford Model T came in 1908. Technology develops faster now. I get the impression that jobs that don't even exist this year may become obsolete before 30 years elapse, and yet employers still routinely hire based on specific experience rather than aptitude or trainability.

Perhaps it would have been more accurate to say that I will never take on debt to buy a home again, and I don't expect to ever be able to afford to buy anything without doing so.

It's a bit more complicated than what you're presenting. Let's say I'm a buggy whip maker in 1890. I buy a house. 1908 comes, and I'm out of a job. I can't afford the house. But if I'm living in a town that wasn't too dependent on the buggy whip factory, then there are probably people who are looking to buy houses, so I'm still able to get out of the house without losing my shirt.

The problem comes when the town's economy crashed (because the buggy whip factory was the big business), or the nation's economy crashes (recession/depression/downturn/whatever), and I have to sell my house. Then I can really get burned.

And the next problem: When I buy a house, I can't be sure what the economic environment will be when I need to sell it.

I would say that, over the long haul, if you live in a town where there's enough variety of employment that you can probably continue to find work even if you lose your current job, most of the time owning your own house is a net win. (Be sure to hear all the caveats in that sentence!)

It's tough to go against the US government who's subsidizing homeowners at renters' expense though. 30-year fixed mortgages are unheard of elsewhere in the world, that's why they all have to be underwritten by Fannie/Freddie in the ultimate end. And with where the interests rate are now, it's tough to resist locking that in for 30 years. And of course, mortgage interest tax deductions on top of that.

Fair enough. I'm lucky to live in a small country.

Takes all kinds. I bought my place after 20 years of payments, on a dozen different jobs. Had savings, so 'between jobs' didn't impact mortgage payments. And I'm out in the county, where if they have zoning rules, there sure as heck aren't any inspectors. So I do as I please. Feels pretty unencumbered to me!

I have been burnt twice on home ownership, and didn't enjoy the pain. Other people will have different experiences.

I do know for certain that I will never sign another mortgage for as long as I live. Those lenders can go FOADIAF.

Exactly, we're all naturally short housing.

https://thezikomoletter.wordpress.com/2012/12/10/you-are-nat...

simply owning a recently-purchased house in an affected real estate market could have caused that. if you couldn't cover mortgage due to job loss or a rate hike, you were forced out and lost the money. doubly so if you were also invested in financial markets. a lot of people lost a lot of money.

meanwhile, parents' mortgage is from the 1980s or 1990s and easily affordable in today's money, even if their nominal market value takes a slump, the mortgage is easily covered and the rebound in values 3-4 years later will put you far ahead again. if you were smart enough to hold steady or even double-down when the financial markets were down, well then you're even richer today.

it was essentially a transfer of wealth from one generation to well-positioned members of the previous generation, and of course bankers/traders. but it wasn't a conspiracy... some people are just better positioned for and better able to see a massive market shift like that.

i personally lost some (not that much) money during that time, and my parents gained money. ultimately their money is my money so i'm fortunate in that regard, but the same exact thing happened to me. i did everything 'right', including saving and investing, and still got somewhat shafted personally due to a combination of extrinsic market forces and personal decisions.

Isn't the Netherlands government spending higher as a portion of GDP today than it was ten years ago?

Is it primarily an issue of where they're spending the money?

Cost of healthcare is going up all the time, social security as well. My wife was a municipal civil servant and they have to make cuts.

How does the healthcare system work in the Netherlands? I'm entirely unfamiliar with it. Is it more similar to Germany / Switzerland, or closer to the UK model?

Looks to me from a simple Wikipedia search that the Netherlands follows the Bismarck Model (Germany, Switzerland) rather than the Beveridge Model. UK's NHS is one of a kind. Not a lot of countries have or can afford to have the same type of healthcare system as UK.

Keep in mind, though, that tech also has a much faster life-cycle than most professions of the day. We're already seeing large drops in average salary for many tech positions. The average developer salary today is not even close to what a similarly "skilled" profession was even 20 years ago. Now, obviously developers didn't exist 20 years ago, but that's taken from a study that compared population sizes in the US to job percentages in the population. Yesterday's electrician is today's developer and they're not paid similarly at all.

> Now, obviously developers didn't exist 20 years ago

i've got some perhaps surprising news for you, my young friend... 20 years ago was 1995.

sure we didn't have broadband and fancypants angular.js but i'm pretty certain developers were around waaaay back during web 1.0 (to use a turn of phrase).

Ahhh, crap. I'm old. Are you trying to suggest that 20 years ago wasn't the 1970's?

I was a software developer in the 1970s, too :-) I wrote a cartridge game for Mattel Intellivision, for example.

Ahhh, crap. I'm old. Are you trying to suggest that 20 years ago wasn't the 1960's?

it used to be!

Yeah. I tend to forget too. Then I realize that StarCraft is about to hit 20, and given that I vividly remember playing it for the first time around 1997, I freak out. Where did all those years go? :(.

Like that old meme: I thought it would take longer to get old.

> We're already seeing large drops in average salary for many tech positions.

Are we?

We are seeing large drops relative to inflation.

This report outlines how STEM wages have stagnated since about 2000[0]

2015[1] CS graduates have starting salaries that are about 4% lower than 2014[2] graduates. Do that for a few years and it adds up.

Anecdotally, I am a "Senior" software engineer that has been writing software for nearly 20 years (professionally 10), work for a household name software company on the east coast, and having trouble affording any real estate in the area without an insane commute.

[0] http://www.epi.org/publication/pm195-stem-labor-shortages-mi...

[1] https://www.naceweb.org/uploadedFiles/Content/static-assets/...

[2] https://www.naceweb.org/uploadedFiles/Content/static-assets/...

Why would the big companies of SV conspire to fix wages if they didn't want to decrease the cost of labor?

Yes, tech workers are very underpaid, even if their pay is good relative to the rest of the economy right now.

I'm not sure that's connected - if wage fixing were to blame we wouldn't be seeing salary drops, they wouldn't have risen in the first place.

My question is more that I would be very interested to see data supporting the idea that there has been a large drop in developer salaries.

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You're mixing and matching the vague "as much as most tech workers" with the quite specific statement about their incomes relative to a bus driver in the early 80s.

I'm at a multiplier between 2-4x U.S. median household income and based on listings I see I feel that range is very good but not "oh my gosh howdeedodat?!?" for developers. Hired.com, for instance, sets the floor for jobs it will show right around 1.5x median income ($75k).

Real wages in the economy are stagnant and we in technology may be sitting on the sundeck of a sinking ship so I understand the "higher up in the stack but the stack is collapsing" aspect of your argument. That said, I totally disagree that a bus driver in 1981 was better off than a software developer in 2015 - there's just no way that makes any sense.

Inflation since 1980 is 290%.

Your average tech worker makes, what? $150K per year? That would equal $51K per year in 1980.

Median household income in 1980 was $16K. Your dad had a pretty awesome salary for being a laborer.

I think $150K is only the average salary of a tech worker if you are a advertisement for hired.com

The average tech worker makes $150K per year? Which country is this, because I'm moving there.

Seeing shit like this just blows my mind. I struggle to believe the Bay Area is really that out of touch with the rest of the world.

It is.

Per Zillow, the median home value in San Francisco is $1,117,300. For the rest of the USA it is $188,900.

If you are willing to drive 2 hours each way to work, and live in the middle of nowhere, you can pay the low price of $630,000 in Gilroy.

Things are crazy here. If you don't live here it can be hard to understand.

that is not your average tech worker salary

http://www.payscale.com/research/US/Industry=Information_Tec...

Working from those numbers, the bus driver math still doesn't work.

He meant in Silicon Valley. 150k is about average for someone with 8-12 years experience. If you're not making 150k, you need to find a new job.

> Your average tech worker makes, what? $150K per year?

http://lmgtfy.com/?q=average+salary+software+engineer

OK, that google link says the averages in SF is $103,367 but I'm hearing about people hiring entry-level coders for $100k this year, so I don't see how that can possibly be up to date.

People who get hired for below-average salaries don't talk about it (or lie). 100k might be the norm at a giant company, but I've seen many startups offering 80-90k to people with a few years' experience and advanced degrees.

Maybe average for a senior manager or director.

Boomer here.

1. I was not particularly well off in my 20s, nor were quite a few of my friends. Yes, the ones who went to law school did pretty well. To be sure, student debt was a vastly smaller problem them.

2. A large number of the people I deal with, and who are within five years of my age either way, are parents of young adults in the work force. There may be occasional bemusement by the younger generation's expectations, but I don't see much resentment.

3. Most of the boomers barely made it into the long economic expansion that followed WW II (though on the other hand you can say we owe our existence to it). You could see things getting tighter and tougher by the beginning of the 1970s. The consumer goods we could afford were a lot shinier and nicer than what our parents had, but the economic security was harder to come by.

>Tech is an area of boom in an economy of bust.

For me tech will make you either much poorer or much richer than your parents.

If you don't spend your time working for risky startups you can pretty much guarantee it'll make you rich. Google isn't going to be able to take back that large salary they pay you.

Yes .. but you'll spend a great amount of it trying to buy that 3 million dollar house in Mountain View. I am not disagreeing with your premise. But I think one can have a better standard of living in a cheaper area far away from tech centers.

There is very little to think about here. World GDP/World population is ever increasing. As such it should be obvious that sons have a better life than parents except in the presence of: 1- local conflict or 2- in the presence of a class that amasses of an unfair amount of resources.

We are clearly in situation no. 2 and these are exactly the periods in history where revolutions start. When the rich get so greedy they make people's quality of life decrease in a broad scale they invariably are tamed by violent uprisings.

http://www.wolframalpha.com/input/?i=world+gdp+%2F+world+pop...

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