Thursday, February 19, 2009

The Boomer Tsunami and the Generation Wars

In our last post ("The Impending Generation War"), we alluded to the rising crescendo of Boomer bashing, replete with generational stereotypes of Boomers as selfish and self-absorbed creatures of 1960s hedonism who sold out their counter-culture ideals, became a generation addicted to mass consumption, and spent, borrowed, and defaulted the U.S. economy into its economic predicament.

That argument is purely anecdotal. There is no question that American consumers in general spent too much and saved too little, but I have yet to see any persuasive evidence that Boomers were any more profligate than any other generation -- in particular, that they were any more profligate than the younger generations from whom most charges of Boomer bounderism emanate. The charges may prove to be true -- I just haven't seen them substantiated.

True or not, we expect to see a ratcheting up of intergenerational rhetoric as the United States hits the wall in its ability to borrow its way out of the entitlements crisis. Politics is a zero-sum game. For every winner, there is a loser. When there's not enough money to fulfill all the promises, either Boomer retirees have their lifelong expectations dashed, or younger generations of workers see their payroll taxes increase.

In that context, I find it interesting to read a recent blog post by Boomerologist Carol Orsborn with The word "entitlements," she contends, has negative connotations. But is it helpful to characterize Boomer expectations about their retirement benefits that way? Writes Orsborn:

We concede to let the government withhold a substantial portion of the money we have earned from every single paycheck in exchange for benefits to be paid to us down the road.

I remember the very first time I received a paycheck, when I was in my early 20's. I'd been counting on every penny of my slim salary for living expenses. What a shock to see how much had been taken out for this then too-remote-to-even-conceptualize notion of "retirement." I must admit that on some levels, the amount taken out for Social Security, taxes, healthcare, 401(k)s and God knows what else, has never lost its shock value.

But here's the thing: I may have disliked the chunk of income that went missing from my paycheck every other week. But I never thought to question that grandma and grandpa and later mom and dad weren't deserving of their Social Security benefits. Society acknowledging the reality of physical and mental diminishments that come with age, and taking care of the elderly was the reality within which our generation was raised.

As a Boomer, I'm well aware that the age wave will do to the American social safety net what the Sumatra tsunami did to the coast of Thailand. But Boomers didn't set up the system, and we didn't resist tooth and nail efforts to reform it. Furthermore, we've been paying into the system our entire working lives -- we're not getting the same free ride that the early generations of beneficiaries did. Are Boomer expectations so unreasonable?

The only thing unreasonable about Boomer expectations is that they fly in the face of the irrefutable reality that Uncle Sam can't afford to keep the promises made by an earlier generation of politicians. Something has to give. As part of any entitlement overhaul, Boomers will have to work longer, have benefits curtailed and/or pay more into the system. I think they'll be willing to make those sacrifices. But it sure would help if the Boomer bashers dialed back their rhetoric. Demonizing a single generation won't get us any closer to reform.

Update: Regarding my assertion above that Boomers were no more profligate than any other generation, the McKinsey Global Institute's 2008 study, "Talkin' 'bout My Generation," does say that Boomers spent more of their income at comparable stages of the life cycle than the Silent Generation did. This is undoubtedly true. But McKinsey is silent on the issue of Gen X and the Millennials, whom, I would suggest, were as derelict in salting away savings as the Boomers were.

The Impending Generation War

If you thought America’s culture wars, foreign policy debates and presidential campaigns generated heated rhetoric, you ain’t seen nothing yet. The looming conflict between the generations over entitlements for the graying population could shape up as the most bruising domestic issue since the Civil Rights movement.

Indeed the generation gap – or, rather, the gap between the entitlements we think we deserve and those we can afford -- could soon supplant race, class and gender as the most divisive force in American politics. Won’t that be fun?

The issue is simple: Our government spends much more money than it collects. The Bush administration brought us half trillion-dollar deficits. The Obama administration is giving us our first trillion-dollar deficit. Meanwhile, we still have the massive entitlements obligations of Social Security, Medicare and Medicaid to deal with – obligations that would run up the federal deficit to $4 trillion to $5 trillion a year in a $14.5 billion-a-year economy if Uncle Sam used Generally Accepted Accounting Principles like the private sector does.

For decades, the issue of deficit spending and unfunded entitlements seemed worrisome but remote. Disaster seemed so far away. Now, we can see it: The first Boomers are retiring, and the generation that would “never grow old” – and happens to be almost twice as large as the once that precedes it – soon will be drawing retirement benefits rather than paying payroll taxes. Add to that the worst recession since 1981. Seemingly overnight, everyone’s sensibilities have been sharpened to the mess we’ve made for ourselves.

At the Boomer Project, we track media articles and blog chatter, and we’ve seen a marked uptick in the number of commentators who put our current splurge of deficit spending in the context of a looming demographic and fiscal disaster. Washington Post columnist Robert J. Samuelson gloomily prognosticated that the Age of Obama could become the era in which generational conflict, or even “generational war,” could break out.

Read the rest of the column. (It gets more up-beat than what you see here!)

(Image credit: Richmond Times-Dispatch.)

Monday, February 9, 2009

The New Lingo of "Retirement"

Baby Boomers will reinvent retirement like they've reinvented every other institution they've touched on during their passage of life. And the ever-adaptable English language is birthing new phrases to describe new social phenomena that are just now surfacing.

Carol Perry, with AWA Wealth Management in Nevada, has compiled a number of those neologisms for the Nevada Appeal.

Boomerang entrepreneur: Someone who retires from their career job to start up that business they've always dreamed of owning. (Sounds reminiscent of "boomerang" children who move out of the house to go to college, only to end up back at home after graduating.)

Jhobbie: Something created when a Boomer turns his/her hobby into a job. The jhobbie brings in some supplementary income and gives the Boomer an excuse to follow his bliss.

Playcheck: What you get when a Boomer takes on part-time employment or temporary work to generate enough extra income to fund travel and expensive hobbies without raiding their 401s(ks)s.

Phased retirement: What comes when employers confront the skills shortage resulting from the mass exodus of Baby Boomers from traditional jobs by enticing them back with flexible terms and that all-important health care insurance.

Friday, February 6, 2009

"Enhanced" Media Consumption

First came the Super Bowl, then the Super Bowl ads, and then the hype over the Super Bowl ads that exceeded the hype over the football game. Then followed video streaming on the Internet, which inspired more replays of the ads than of the game highlights.

In the past two or three years, Americans have taken yet another step toward the transformation of the championship football game from an athletic contest into a media phenomenon. Millions of us now view Super Bowl ads that don't even run on the Super Bowl.

A case in point this year was's ad featuring Danica Patrick, the female Indy race car driver, in a spoof of a Congressional hearing into a major league "enhancement" controversy. Under questioning, a series of voluptuous young women vehemently deny being "enhanced." Then the camera shifts to the comely but -- ah, shall we say -- slender Ms. Patrick, who announces, "Yes, I've enhanced." The crowd gasps. "It's true," she continues. "I have enhanced my image with a domain and web site from" The end of the ad invites viewers to visit the web site where they can view a "hot" Internet-only version.

The hot Internet ad generated more than 1.6 million views just on the Spike TV web site. As for the web site where most viewers were directed, let's just say it's a good thing that is an Internet Service Provider or its servers might have crashed.

Boomers have a reputation as being less technologically savvy than their Millennial (Gen Y) children to whom such tasks as setting up Facebook pages, texting messages on their cell phones and Twittering are second nature. But that impression isn't entirely fair. Les us not forget, Boomers did invent the personal computer. (Anyone remember Bill Gates and Steve Jobs?) Read more.

Boomers Discover Facebook

Baby Boomers long considered Facebook, birthed in a Harvard College dormitory in 2004, as a frivolous Internet novelty that gripped young people but was of no conceivable interest to serious people. That was then, this is now.

The Facebook phenomenon migrated out of dorms as college kids entered the working world, and then percolated upward through the age strata. Within the past half year or so, Facebook has breeched the Boomer barrier. We Boomers first started receiving "friend" requests from younger colleagues. Many of us set up Facebook profiles out of curiosity. The random friending requests turned into a trickle, and the trickle became a flow. Then came the emails from friends, and the requests to join groups, and invitations to go places, and friending requests from people we don't even know.

The Facebooking of the Baby Boomer generation was first recognized last week as a bona fide social phenomenon, as far as we have noticed, when Mackenzie Carpenter, a writer for the Pittsburgh Post-Gazette, penned an article, "OMG! Mom's on Facebook! And so are a lot of boomers."

While Facebook is still dominated by young people, nearly a third of its users are between the ages of 35 and 54, according to Comscore, an online audience measuring company. In our observation, an increasing number over 55-and-overs are signing up as well.

The online interaction raises a host of social dilemmas that Boomers have never confronted before and, as far as we know, Emily Post has never addressed in her etiquette book. What happens if you're friended by your boss -- whom you don't like? Is it better to reject an unwanted friending request outright, or is that too harsh -- is it better to simply leave such a request hanging? Closer to home: Is it appropriate for a Boomer to "friend" his 23-year-old daughter? And should he take umbrage if she turns him down?

For all the current fascination, we doubt that Facebook will ever take root among Boomers like it has with younger generations. We Boomers -- especially those of us with children at home -- are time starved. We don't have time to answer our regular email accounts, much less keep up with the barrage unleashed by Facebook or to keep our profiles continually updated. While it's pleasant to be contacted by the occasional long-lost friend, we'd rather not face the pressure of keeping up with a lifetime's worth of acquaintances. Twenty or thirty "real world" friends is about all that most of us can handle. In our book, face-to-face relationships are still best.

Valuable Insights into the Hearts, Minds and Wallets of Today's Baby Boomers

This blog is by the authors of Boomer Consumer: Ten New Rules for Marketing to America's Largest, Wealthiest and Most Influential Group, on sale now.

Here is where you'll find information referenced in the book, as well as updates, news and perspectives from Matt Thornhill and John Martin, founders of the Boomer Project.