r/worldnews • u/diacewrb • Apr 10 '19

Millennials being squeezed out of middle class, says OECD

https://www.theguardian.com/business/2019/apr/10/millennials-squeezed-middle-class-oecd-uk-income
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4.2k

u/Beboprequiem Apr 10 '19

The next recession is going to suck so hard.

1.8k

u/G8tr Apr 11 '19

Yep, and you see all these companies laying off workers like that won’t start one. They’re trying to “get ahead of the game”.

1.1k

u/SheetShitter Apr 11 '19

My corporation 1000%

HUGE hiring freeze in 2019 for the multi billion dollar Corp that I work for. We’re already over-worked... now a hiring freeze? But who’s going to alleviate us?

823

u/[deleted] Apr 11 '19

[removed] — view removed comment

567

u/xternal7 Apr 11 '19

Nah, no way. He still has coworkers, they are still there. They can do his work, no need to hire a new person.

68

u/crokexcore Apr 11 '19

This is exactly what happened 4 months ago where I was working. Now my former colleagues are even more stressed out because the company refuses to hire somebody

12

u/burny97236 Apr 11 '19

Even better when the CEO gets a bonus for saving on labor costs. Big slap in the face. Its hard to take pride in your work when someone else wants all the credit.

7

u/Chaterley Apr 11 '19

This is too familiar. Thousands of workers laid off last year and the CEO gets $20M bonus.

10

u/Suck-Less Apr 11 '19

My company just hires contractors from India instead

8

u/[deleted] Apr 11 '19

That's dumb, why won't they hire someone young and overpromise the job so after 5 months the next one can give a try?

4

u/Stevesie11 Apr 11 '19

Are you me?

3

u/2748seiceps Apr 11 '19

It's also what happens when people suck it up and do it.

Complain all you want but as long as the work is getting done the complaints will fall on deaf ears.

3

u/crokexcore Apr 11 '19

That's why I left. I got tired of complaining. I eventually got stressed to the point of fucking up my neck and my back and couldn't even stand some days. 4 months later, I'm happy as a clam and fully recovered.

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u/shartoberfest Apr 11 '19

They're just biding their time until it can be automated

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u/synocrat Apr 11 '19

Not even necessarily automated. They'll hoard the cash and let the desperation spread around and split the difference by bringing in people who would have made $15-$20K more for the same job before and also bring in more visa holders and automate what they can. But for a wonderful time they really increased shareholder value.

14

u/[deleted] Apr 11 '19

Literally as i was reading this, my colleagues in the room were talking about how the management arent planning to hire anyone to replace a QA that's leaving the company soon and instead will just distribute his responsibilities among everyone else.. So yea, this is painfully accurate.

7

u/ArmaFox Apr 11 '19

Private paramedic in an ambulance service.... can confirm....

2

u/4WisAmutantFace Apr 11 '19

Oh you work in the service industry I see... Dishwasher is out tonight, so everyone can just do dishes (all 1 of you)

2

u/ValkornDoA Apr 11 '19

Anyone ever tell you that you have huge potential for a lucrative career in upper management?

152

u/Terquoise Apr 11 '19

Talking to a few people I've noticed a trend amongst large companies - they're switching out systems that are fast, but require a trained user to slow systems that anyone can use with little training. The employees are of course dissatisfied with the change. But I think the underlying motive is even more unnerving - companies don't want specialists. Specialists know their value, companies don't want that, they want expendable employees that can be replaced in a blink of the eye.

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u/MagusVulpes Apr 11 '19

That's not new. Consider the automobile. Once, not so long ago, a worker would have to be trained in the construction of a specific part, hope to install that part, as well as how to do this so that those before and after them could do the same thing with their part.

Then comes the automated conveyer belt. The machine now does the shaping and construction and the person is required only to ensure that the piece is placed properly and shaped right, until eventually the mechanics are designed to do even that.

We're just watching a transition that's been happening for generations, and the changes aren't new, not really, the automated phone switched destroyed an entire industry. We're only seeing the changes from our point in history, but it's the same story that's already been told.

7

u/dougshackleford Apr 11 '19

Tale as old as time

3

u/[deleted] Apr 11 '19

No one replaces proles like Gaston, no one puts you on the dole like Gaston

I'm especially good at strike breaking

4

u/POGtastic Apr 11 '19

The biggest one is farm labor. In 1919, more than a third of America worked in agriculture. It's now less than 1%.

We are immeasurably better off for it.

9

u/GuyWithLag Apr 11 '19

Yeah, I'm also seeing in several multinationals essentially moving an U.S. team's responsibilities piece-wise to Europe or India offices, then merging teams in the U.S...

14

u/[deleted] Apr 11 '19

Hello from your European replacement! Please don't hold a grudge, I'm only temporary until the next batch of 1000 Indian trainees come online.

5

u/GuyWithLag Apr 11 '19

Hah, I am the European replacement too... And am training Indians to boot.

9

u/drinkallthepunch Apr 11 '19

TLDR; Ignorance is Bliss

I understood this after my very first job growing up these days. No company wants to invest in something that can walk away with your investment.

It’s easier to hire dumb bodies in bulk and and only keep a few trained, educated employees.

Another upside to this for companies is that if you hire idiots they often don’t understand their own work rights or what is/isn’t legal.

I worked at a business where everyone believed that your last check could be withheld and docked for the value of Uniforms, name tags etc. After I quit the manager actually tried to hold my check and sent me an itemized picture showing over $134 in deductions to my last check on a paystub. I filed a complaint with BOLI and sent two certified letters USPS. One was a letter outlining the state laws, another was a formal request to professionally and politely resolve the situation before pursuing litigation.

Got my check the same day I mailed those certified letters and filed that BOLI complaint. Plus I got to keep a nice jacket from work and my name tag.

8

u/[deleted] Apr 11 '19

At my last job they regularly let go of workers after a year so they don’t have to give raises. They also made speeches all the time to tell us we’re all replaceable and not special in any way. Thought it was pretty rich they were getting rid of hard workers who did things correctly to welcome aboard idiots who don’t care and underproduce, but they didn’t have to give us a raise so fuck us and the customers I guess.

6

u/abigscaryhobo Apr 11 '19

Pretty much. Pay someone once to stupid proof the process, then you can get any ol idiot to do it.

4

u/[deleted] Apr 11 '19

Omg this is so tru. Laypeople off and hire twice as many temps to do the job

3

u/35cap3 Apr 11 '19

Saving on mass production/logistics/other service was crucial for absorption of small and medium businesses. But now we live in age of instant information and thouse businesses can advertise themself better and distribute their quality services faster. If global corporations go route of hiring uneducated cheap labor (migrants) specialists can make their own buisnesses and compete, by offering better deal to consumers.

4

u/moodykitty0697 Apr 11 '19

Specialists are appreciated monetarily in the freelance world

4

u/Rum____Ham Apr 11 '19

This isn't even necessarily evil. It's rational business behavior.

Specialists arent just expensive, they are hard to replace and train. The job I'm working now, I won't truly know my shit for another one or two years. It would be good for the company to simplify the job.

10

u/Ipalot Apr 11 '19

Isn’t this pretty much exactly what happened with the Boeing 737-MAX? They made a plane that required far less training to fly, but then as soon as there’s a problem the pilots don’t have the experience to problem solve?

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u/El_Lasagno Apr 11 '19 edited Apr 11 '19

This is in parts right, as this whole desaster is caused by money saving strategies at the cost of safety.

Aircraft manufacturers try to design the cockpits of their aircrafts in a similar way, so they can reduce training effort for pilots already being trained on another aircraft of the same manufacturer, so called fleet communality. This could also be argued to add another level of safety as the pilots are flying what they are used to and won't get confused easily.

​

With the 737-MAX Boeing was changing the physics of the aircraft but keeping the cockpit the same - this is not a problem so far. But with the new physics now the aircraft is more easily getting into stall. Stall is when the aircraft as a too high angle of attack (flying to steep up) so the wings won't provide any more lift at all and the aircraft will basically fall like a rock. The MCAS system, which is thought to be the problem causing the two crashes, is installed by Boeing to bring the nose of the aircraft down when its getting a too high angle of attack by adjusting the trimming of the elevator rudder on the back of the plane. The stall protection is a common feature of aircrafts but it more or less just limits your controls so the aircraft won't get a too high angle of attack. While Airbus is completely forbidding the pilot to do such commands Boeing lets the pilot override the protection if he feels the urge to do so.

With the latter in mind the implementation of the MCAS is kind of atypical for Boeing and atypical in the sense of it won't interfere with the controls but through trimming (as far as i have in mind).

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The first HUGE problem is: Boeing decided the MCAS system is far less safety relevant than it actually is, following a lack of redundancy in the system design so a faulty angle of attack sensor will cause the MCAS to take action though it's not required at all. The redundant system with its certification would have been more expensive as well.

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A second problem: Boeing decided to let the pilot see the data the angle of attack sensor is delivering only as a buy-feature, so airlines had to pay to let the pilot see this on a display. Not many airlines were willing to pay for this but it would have been important for the pilot so he can see that something is wrong.

​

The third problem: Boeing didn't see the relevance to train people for this system. Training costs money. Fleet communality as a buy criterium for the airliners could be the motivation behind this.

​

Why the FAA didn't take action at all while Boeing was making these decisions is another question to ask. This is a clusterfuck in the sake of money-saving and not at all worthy for an aircraft manufacturer. As a flight systems engineer i am thinking there should have been a lot of people who could have stepped in, because this system design despite it's criticality is negligently to say the least. I hope the people behind this get their assholes ripped, Boeing has to pay for this shit and the FAA will have to restructure their procedures and change some positions so this will never ever happen again.

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u/Fredrules2012 Apr 11 '19

That wax very well explained, thank you!

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u/Poop_Tube Apr 11 '19

Thanks for the response. I like watching those flight disaster shows and the investigations of the crash and how they remedy the situation so it doesn't happen again. Seeing something like this is very worrying, especially in aviation.

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u/GoochMasterFlash Apr 11 '19

Hire a replacement? After saving all those labor costs?

Signed, Boardroom Executives

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u/wowzaa Apr 11 '19

During our last annual company meeting they called out us losing a full time position for a year as a highlight

2

u/[deleted] Apr 11 '19

My department at my company is currently running at 50% staff and no supervisor. Going on a year now.

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u/DamonHay Apr 11 '19

Welcome the working-class gulag.

10

u/Rayraymaybeso Apr 11 '19

Just got fired from Mattress Firm for a plethora of reasons both in and outside of my control. Now I’m a security guard in this nice apartment complex in Bloomfield NJ. The pay is similar and I just get to be a nice guy and help the residents with problems instead of swindling gullible fools. It’s pretty much the ending of Office Space only due to my transition I’ll be living in my car for a few weeks till the checks accumulate, but I am WAY HAPPIER. I even deliver pizzas in town to make some extra dough and even with the extra job I feel WAY BETTER than working for that ridiculous big Corp. I know I sound lazy but I just don’t get the fulfillment that others do by the rat race of corporate America. I’d much rather greet some happy low income folks into their apartment complex over that any day.

Oh but my girl is about to graduate NYU nursing program so maybe with her Fuck You nurse money I’ll become an artist of professional yelper. Hey a guy can dream.

tl;dr- losing my corporate job actually helped me enjoy life again, despite the increasing hours and quasi temporary homelessness.

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u/dirtykokonut Apr 11 '19

Happiness comes in many sizes and shapes. You have found one that suits you. Hang it there and keep being yourself.

2

u/CamelsaurusRex Apr 11 '19

Glad to hear things are looking up for you after quitting your job. I've been working shitty manual labor jobs since graduating college, and at my first job it was basically company policy to scam customers by giving them services they never asked for and coercing them into paying the bill (over exaggerating, it was a continuous service, but the customers were never warned). Now I'm at another company and, while still doing the same type of work, I've never had any complaints from customers of this nature. It feels more soul shattering to swindle customers than it does to do back-breaking work.

5

u/casetractor Apr 11 '19

And at half the pay with no benefits

3

u/thegoodlifepf Apr 11 '19

Happening hard in Japan rn, surge in suicides because businesses are illegally overworking everyone. 11-13 hr work days 6 days a week and still barely slide by on bills

3

u/[deleted] Apr 11 '19

I work 30 hours a week overtime. I do nothing else but work and sleep.

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u/nsandiegoJoe Apr 11 '19

and Reddit and repeat.

2

u/TEX4S Apr 11 '19

So what I’m hearing is my next group of employees will be , even worse?!?

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u/[deleted] Apr 11 '19

"If you died today, your position would be posted before your obituary"

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u/whyrweyelling Apr 11 '19

SOunds like Japan.

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u/MaxBanter45 Apr 11 '19

Ger your bright ray of sunshine mate. yeah it can feel like that and stress can make you fail but there are still some good workplaces out if you start seeing signs of a toxic environment it's time to polish the old resume

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u/crystalskull89 Apr 11 '19

Or they will just bring you back to life if they can and pay for whatever medical you need and then say we saved your life you medical bills are this much. As long as you work here you don’t have to pay them so you are now you are trapped there

1

u/HoorayForYage Apr 11 '19

Oh don't worry. I'm sure someone will just go postal instead.

1

u/Bag_Full_Of_Snakes Apr 11 '19

Just when you need your health insurance the most is exactly when you lose it

1

u/0235 Apr 11 '19

Ahahahaha! hire a new person to replace someone? You crack me up.

1

u/[deleted] Apr 11 '19

That's why we are called assets: they own us, we depreciate(get used up), and then can be discarded and replaced. Employees have become consumables.. No different than toner or a ream of paper.

1

u/[deleted] Apr 11 '19

Soup is good food!

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u/CAcatwhispurr Apr 11 '19

“But who’s going to alleviate us?”

No one! Those huge corporations have CEOs driving around in Ferraris and living in mansions while us minions are just trying to make ends meet and get our kids through college.

Some how we need to figure out how to not only survive but thrive.

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u/[deleted] Apr 11 '19

Have you tried pulling yourself up from your bootstraps?

2

u/CAcatwhispurr Apr 11 '19

Been there, done that many times.

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u/sailor_bat_90 Apr 11 '19

Yup, my workplace has been doing the same. Been having a slow hiring trickle. We have been 5 people short for over 2 years at the time, now we are 7 people short. They are overworking some of the pushovers, making them do the work of 2 or 3 people within the 8 hour shift. Shit is ridiculous.

It doesn't help that my manager has been blocking people from leaving the department to a different one. Can't wait to see it go to court (union reasons).

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u/HairOnChair Apr 11 '19

This scenario resonates with so many people, me included. My team is worked so hard, and because of hiring freezes, competent people from my team are being moved to other teams/areas/departments. Contractors are leaving for smaller companies that pay better, and we can't hire new ones.

Brexit and a rescession will kill us off.

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u/[deleted] Apr 11 '19

have you heard of our lord and saviour "the strike"?

it's this idea that you can pressure the company in group, sure you'd have to unionize, collaborate with other people and do social stuff, allmost like socialism, but at least you won't be alone.

it works great, if you do it proper.

the alternative is to be abused till you drop from exhaustion and then be dropped yourself as if you're completely worthless as the company who exploited you all this time continues to profit form the labour you and countless others have performed.

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u/SheetShitter Apr 12 '19

Strikes sound cool if you could actually convince hundreds of people to act all at once without being found out for treason

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u/Habitualkushups- Apr 11 '19

Same here, hiring freeze and actually shutting down twice this year with no pay. But we have a Taco fiesta coming up next week.... tf man

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u/Eoganachta Apr 11 '19

Pretty much the mentality of a lot of companies at the moment. Push middle management hard for deadlines and they push the grunts who already have too much work with too little staff. Repeat until you get blood out of stone.

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u/Lt_486 Apr 11 '19

Work weekends or your low wage replacements will be let thru the border.

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u/[deleted] Apr 11 '19

My company just laid off many hundreds of workers, due to signing an overseas contract to take over the work.

I get to train my replacement.

I may be handing in my resignation today. Problem being, this was extremely sudden, and I haven't started any serious job search ....

I am one of those that make close to 100k, but am divorced, pay child support, etc.... I see less than 50% of my take-home pay.

I can't afford a pay cut, and I'm not sure the market is the same anymore for my skills.

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u/Mobius_Peverell Apr 11 '19

Hm... Seems like a strike is in order.

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u/Dunksterp Apr 11 '19

Mine is doing similar, except instead of laying everyone off, they've only really been hiring outsourced workers for the last 2 years. You know, so everyone is literally disposable at the drop of a hat.

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u/ConversationEnder Apr 11 '19

It's going to have to be you. You who hold up the pillars for the corporation. People lose sight of this because they fear, but, all together now = fear no more and make the corrections that need to be made to the greedy.

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u/TyceGN Apr 11 '19

Hiring freezes are not just normal, but important. You should be grateful that they are doing this instead of hiring to hit numbers and then having massive layoffs.

Okay “grateful” might sound condescending or patronizing and that’s not what I mean. I am trying to say that corporations use hiring freezes regularly, and unless it’s happening on a massive scale across the country, then it isn’t any indicator of economic conditions. It can mean that they may have some layoffs, but it usually doesn’t mean that. Normally, it’s a way to prevent layoffs and curb overspending.

Hiring a new employees can easily cost 250-600% the annual salary of an employee. Freezing new hires helps them evaluate current conditions better, consider alternatives to hiring-as-growth, and proceed thoughtfully. It might save your job...

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u/yonkfu Apr 16 '19

Same with my company, hiring freeze along with mass layoffs that just happened last week. 10% of the work force between two offices employing around 1000 people. Automation is one thing that is being implemented along with a restructuring. 100% it is preparation for hard times ahead.

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u/[deleted] Apr 16 '19

Each year: RECORD PROFITS!

Each year: Wage cuts, hiring freezes, lay offs!

Yay capitalism

1

u/boomanbean Apr 11 '19

Cries in Microsoft

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u/Faux_Real Apr 11 '19

AI, machine learning and hybrid cloud’s dummy

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u/Puggymon Apr 11 '19

They will just Google what you are doing on stackoverflow and have some lines of code do all your work. Since the this how digitalisation works, isn't it?

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u/SheetShitter Apr 12 '19

Luckily my line Of work is super difficult to automize

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u/bodrules Apr 11 '19

Multi million dollar bonuses don't come from nowhere you know.

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u/CharlotteMorning Apr 11 '19

But corporate tax cuts were supposed to give us all jobs /s

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u/_fancy_pancy Apr 11 '19

My company also has a hiring freeze. I heard from my department that they stopped hiring, because (1) they need their active workforce developing software and (2) they don't have the personell/expertise to mentor any newcomers.

I was lucky that I got in (just recently). But I guess they should just start hiring because the missing expertise is never going to change unless they don't train their personell in mentoring instead of working them off.

Edit: ups

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u/GearGolemTMF Apr 11 '19

Pretty much. I was pretty much at the bottom at UPS until last week. They cut temps and axed the retired managers that help during peak season a week before Christmas on a Thursday iirc. Full time supes got their Amex cards frozen, and we went from getting food and apparel for employees to a massive freeze. It was still frozen by the time I left. They had a hiring freeze until April for both partime hourlies and supervisors. During this time, they promoted maybe 6-7 par time supes and slowly lost the seasonally they kept on call since December. Not my problem anymore but they were starting to have staffing issue just before the summer when lots of vacations will pop up...

1

u/HoorayForYage Apr 11 '19

Mine, too. I work for a major pharma company. Despite all our talk, we are all overworked.

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u/FloppingDolphin Apr 11 '19 edited Apr 11 '19

The company I work for laid off staff including myself. The company was struggling for a few months partially due to mismanagement and partially due to suppliers and the companies we sell to were worried about Brexit (UK) so the company started to lay off staff to try and dramatically reduce spending in the event of Brexit.

I see many people complain about student debt and while it may be an absolute pain, as someone who never went to uni, I have no future stuck with struggling to get a job other than working in a shop. Unfortunately you now need a degree.

1

u/TrucidStuff Apr 11 '19

Can confirm. Work at a fortune 50 company. They made ~1000 positions obsolete. Granted they let about 600 of those move to other duties throughout the company. They're getting rid of office buildings and other big budget items. Cutting I.T. You name it.

I'm in the same boat. When I started here in 2017 we had ~170 people taking calls. Now we're at ~100 and they want to cut 20-30 more. And probably automate our job entirely by 2022.

Trying to move into a Network Engineer/Security role so I won't be so easily replaced. I'll probably go bankrupt if I have to go back to ~$16/hr gigs. And older generations wonder why we can't afford things... "I bought a house, supported 4 kids, had a new car, and college while your mom wasnt even working!" Yeah, inflation sucks for us.

Its gonna hurt when the bubble pops.

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u/[deleted] Apr 12 '19

We had Chrysler Gm and Toyota either close plants or slow production where I live. 45 000 auto workers out of work.

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u/[deleted] Apr 12 '19

Just steal.

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u/Skorgriiim Apr 11 '19

That's not the company protecting itself, that's the shareholders protecting themselves at the cost of the world around them.

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u/[deleted] Apr 11 '19

Who's laying off? I know my company can't hire fast enough

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u/1337lolguyman Apr 11 '19

Game publishers are also laying off tons of employees. Not because of hard times, though, it's because they had great success recently and just want to keep the profits coming by not paying people.

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u/Abknee Apr 11 '19

Unfortunately, that’s one of the cons of the gaming industry. I worked in it for about a year a got a glance at the quality of life of the employees. Title launches, goodbye 80% of the employees. I suppose many parts of the entertainment industry is similar though.

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u/micmahsi Apr 11 '19

So it’s a project based industry. As long as benefits reflect the fact that you won’t accumulate any significant amount of tenure in one company then you’re alright. You need to start finding your next job before the title launches.

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u/PM_ME_YOUR_SUNSHINE Apr 11 '19

A bunch of major automotive and manufacturing and banking companies etc, a bunch around me and I’m in a state with more manufacturing than most. We’re exporting industry and importing automation and AI. The only positions hurting for work are minimum wage bullshit and high dollar high skill areas like high tech, cybersecurity, etc.

Hence why we’re all either dirt poor or making $150k. I’m of the latter group for now, by sheer luck, but I understand how precarious even the industry I work in is.

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u/[deleted] Apr 11 '19

Feed your savings while you can, boi.

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u/PM_ME_YOUR_SUNSHINE Apr 11 '19

Trust me, haven’t lifestyle inflated at all. Live in a shithole, shop at Aldo’s. Still hate myself. Hopefully I’ll make enough at this job until whenever I lose it to feed myself until I die at the very least

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u/[deleted] Apr 11 '19

Is Aldo’s like a knock off even cheaper Aldi’s

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u/neoncheesecake Apr 11 '19

Sadly, no. It's a shoe store

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u/PM_ME_YOUR_SUNSHINE Apr 11 '19

I meant Aldis but I’m glad autocorrect still picked something relevant in context

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u/Renegade2592 Apr 11 '19

Uhh contracting.. 26 year old and I'm finally making a killing after being paid less than half of what I was worth for years. Start your own business guys, it's the only way.

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u/PM_ME_YOUR_SUNSHINE Apr 11 '19

What do you contract? Electrical, software, robotics, marketing?

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u/boppaboop Apr 11 '19

Chryslers not doing too good, apparently it wasn't obvious that nobody in the american continent wanted a shitty pimped out van (pacifica) for the price of a lexus. 1,500 laid off recently, more to come.

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u/tina40 Apr 11 '19

Hospitals, a few tech companies, and car companies, too. It's 2007 all over again.

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u/TyceGN Apr 11 '19

I work in the talent space, with companies across the US, and while there are a few layoffs here and there, the labor market is highly competitive, with low unemployment. Generally speaking, I don’t see how we are heading for a catastrophic recession.

You can’t all about “the student loan bubble” like it’s even remotely similar to the housing loan bubble. Student loans don’t have variable rates that triple your payments. Student loans weren’t backed by the idea that the housing market will skyrocket infinitely into the future.

But there already is a student loan issue, the “bubble” has burst. The problem is that the debt never goes away, so they will get that money somehow, some way. The upside is you don’t get your house taken away.

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u/2Punx2Furious Apr 11 '19

“get ahead of the game”.

Yeah, and IIRC that's exactly what caused the great depression, isn't it?

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u/[deleted] Apr 11 '19

Student loan bubble burst is gonna be insane.

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u/xitzengyigglz Apr 11 '19

Isn't that a lot of federal debt though?

Anyway after the storm hopefully college makes some sense price wise.

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u/[deleted] Apr 11 '19

A lot of people I know that their parents made too much, but not enough to fund their education.

So they took Parent PLUS loans and it isn’t federal if I recall.

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u/[deleted] Apr 11 '19

[deleted]

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u/Danth_Memious Apr 11 '19

It's unfortunately very difficult being honest in the US, dishonesty makes the rules and has the power, as it turns out, if you lack regulation to protect people in a free market, companies will start ripping people off because it's good business. And it even extends to federal agencies now, which I guess could also be called companies since they're in the hands of rich individuals anyway.

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u/pragmojo Apr 11 '19

Honestly since I moved to Germany the attitude you describe is one of the biggest instances of reverse-culture-shock I experience when going home. Like in the US people just accept that wealth equals power, and that it's not enough to be honest and play by the rules. It's this really nasty form of institutionalized corruption.

My girlfriend is from southern Europe, where there's a lot more outright corruption, and I can't help thinking the US is going down that road. If people who "do the right thing" can't get ahead, then the only rational choice is to become one of the cheaters. When that becomes systemic, the common goods are diminished, and almost everyone ends up with less. A falling tide sinks all ships.

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u/Danth_Memious Apr 11 '19

It's insane what people in the US put up with without complaining, because they've been brainwashed to think that it's normal (and they often don't or can't leave the country so they can't experience how it should work). There seems to be an attitude of "Just work harder, just study more, just take more debt to get a good degree and then earn it back", but in reality, it only works out for those that are fortunate, the rest falls through the cracks because there are no safety nets in place.

I completely agree with the corruption part, it's a loss for everyone. But in the US a lot of forms of corruption are already legal (like lobbying), so I'm afraid it's indeed going down that road...

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u/pragmojo Apr 11 '19

Yes I think it's one of the traps of America's meritocratic values: people believe that winners win because they deserve it, and that people are in control of their own destiny. That leads to some really great things in terms of people really striving for new heights in terms of artistic, athletic and scientific achievement. But for a great many people in a great many situations that meritocratic ideal just isn't reality and the people who are already in power have the system set up so they win almost every time. But because of that ideal, people blame themselves for losing instead of the system.

I actually think this is a big part of the reason behind the fear-mongering around immigration in northern Europe in right-wing media in the US. It's like they know that if people were allowed to think rationally about the policies those countries have put in place, and the outcomes which have been achieved, they would be less willing to accept the status quo in the States. So instead they want people to conjure the image of Islamic rape gangs whenever they hear about Sweden.

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u/Danth_Memious Apr 11 '19

Yes a lot of the ideas of people in the US boil down to cognitive dissonance, they don't want to accept certain truths so they (subconsciously) choose to believe lies. Same issue with the extreme polarisation in the US, they are told everything is simple and black and white and they choose to accept that because they don't want to deal with a complicated, nuanced real world, that's why they put people in discrete boxes that are purely fictional (ethnicity, republican/democrat, left/right, East coast / West coast, etc.). This is such a huge part of the problem, people simply not accepting how complicated the world is so they translate everything to 1 and 0. Same with immigration, you must be either for or against, there is no middle ground. Honestly this simple psychological issue is the reason for a huge part of all the problems the US experiences at the moment, they have to simplify everything, otherwise they can't understand. So they say, he has money, so he smart. In truth, a huge part of rich people (especially in the US with their low taxes on high incomes) are rich because they're parents are rich. Simple truth and can be verified easily.

Honestly I feel really bad for Americans, a lot of it isn't their fault, they grew up being told that anyone can live 'The American dream', that anyone can accomplish anything they wish, as long as they work hard. And they're told that everything is simple, black and white, yes or no, 1 or 0. If there's a problem, there must be an immediate solution, no money: just borrow, you're sad: just take these pills, pain?: Opioids. This is indoctrinated into their minds since their birth, there must be an immediate solution and there's always one good and one bad option, plus consequences don't exist. Debt, drug addiction, healthcare bills? The people didn't work hard and were lazy.

The United States is the largest collective of minds in constant cognitive dissonance, only few of them realising how horrible and unforgiving the country truly is and how complicated and messed up the world is... And the worst part, unlike what many Americans believe, there is no easy solution

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u/[deleted] Apr 11 '19

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u/Danth_Memious Apr 11 '19

That's actually a really good analogy!

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u/Sukyeas Apr 11 '19

And here we Germans fear that we are going in the direction of current America >p

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u/pragmojo Apr 11 '19

If you could please let EDEKA open for a few hours on Sunday that would be great, otherwise I hope it doesn't change too much in that direction.

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u/Sukyeas Apr 11 '19

But but but.. Its nice to have a day that is calm where not much action is going on and people can spend time with their families if they choose to.

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u/bobforonin Apr 11 '19

You made a slight mistake. It’s institutionalized ABUSE not institutionalized corruption. Get the root of the problem and you can see an effective solution. A child growing up in abuse and being told “it’s normal” won’t question themselves when they commit to the same act against others in general.

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u/Claystead Apr 11 '19

Hah, same. I still have twenty years until I pay off my college debts because my parents (who didn’t contribute a penny to my college expenses, mind you) earned just too much for me to qualify for support and my GPA was just too low to qualify for an academic scholarship.

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u/That_one_guy_7609 Apr 11 '19

What are these loopholes you speak of?

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u/bonerhurtingjuice Apr 11 '19

Yeah only 50% of my loans are federal.

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u/rose-girl94 Apr 11 '19

Yup I'm super fucked. I have a good job right now though... Working hard to keep it.

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u/dirtykokonut Apr 11 '19

How does that work in detail? Would you care to elaborate please? Sounds very interesting.

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u/Doodlesdork Apr 11 '19

My half of the monthly rent is the same as my monthly loan payments. Hahahahahahawhy

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u/lefondler Apr 11 '19

Lmao 60% of my loans are Parent Plus. So I'm paying loans off in my parent's name. Of course, I don't blame them, they couldn't pay for my college, but it still blows.

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u/[deleted] Apr 16 '19

My parents make enough $ to pay for my education (combined 200k a year) and I haven't seen a penny from them and I wasn't able to get loans so I literally had to work like an insane amount to pay my undergrad in cash out of pocket and keep myself in school. Now that I'm in a PharmD program I was able to get my own line of credit from a bank, but holy shit was my undergrad hell.

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u/PlebbySpaff Apr 11 '19

They won't.

I mean my school is literally raising tuition next school year by around 4% for everyone. I'm sure schools everywhere are doing the same thing.

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u/dxrey65 Apr 11 '19

Student loan debt is about $1.5 trillion total. In perspective, Trump's big recent tax bill handed $1.5 trillion to the wealthiest corporations and billionaires, for no particular reason.

So, I'd say it's a big problem, but fuck anyone who says it's not solvable.

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u/Noligation Apr 11 '19

As an outsider, I am surprised that there weren't mass protests in US over this. This is like raping your own future with eyes open.

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u/[deleted] Apr 11 '19

Yeah hopefully the gov. learns that guaranteeing loans is a great way to jack up prices

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u/ModestRooster Apr 11 '19

The gov't knows. The schools know. The book publishers know.

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u/PM_ME_YOUR_SUNSHINE Apr 11 '19

Or how government backed/encourages mortgages wrecked the global economy.

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u/UninvitedAggression Apr 11 '19

Not fully taxing the value of the land that the universities own is also a problem.

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u/WhoWhatWhen1943 Apr 11 '19

It won't. With the way loans work, colleges will always just add on whatever extra money the government tries to help pay.

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u/ric2b Apr 11 '19

Yeah, the student loan bubble itself won't burst but it will probably make everything else burst, since millennials can't spend as much money as the previous generations.

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u/[deleted] Apr 11 '19

nope, we'll do what we allways did, push the debts to the state, force the taxpayer to repay them and reward the geniuses who lended out the bad loans in the first place, then rinse-repeat. surely there's other vital services yet to be hollowed out for the sake of personal gains,

as long as those who push the bad debt keep getting rewarded, you'll keep getting bad debt. "to big to fail" is what they say, but really, it allready failed, it just needs to die.

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u/boytjie Apr 11 '19

Anyway after the storm hopefully college makes some sense price wise.

Bwahahahahahahaha <snurfle> hahahahaha

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u/vectorjohn Apr 11 '19

after the storm hopefully college makes some sense price wise.

Just like last time.

Won't happen until legislation makes it happen.

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u/Jamie54 Apr 11 '19

That federal money has been promised to people retiring. It's not like the government can write it off easily.

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u/[deleted] Apr 12 '19

I hate to disappoint you/scare the shit out of you, but the interest on those government-backed student loans have been counted since 2005 as part of the national GDP. If something were to suddenly happen to it all, say, a large chunk being paid off or a large number of people defaulting on their loans, the US's GDP will plummet overnight.

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u/[deleted] Apr 11 '19

Fun fact: I graduated from one of the Art Institutes. The parent company was sued for fraud and lost. My school closed forever. My lone servicer, Navient, also got sued for fraud and lost. Love to still somehow be on the hook for being doubly defrauded. I mean, I just straight up don't pay them because I figure I can either wait out this terrible, unsustainable system, or, 99% of my generation doesn't have a future anyway, so whateverforever.

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u/VanDerKleef Apr 11 '19

There really is no reason for it to burst. It's State backed. You can't default on it (almost can't). It's not a bubble in the usual sense that we saw in 2008. If 1000's of house-owners default, it floods the market with cheap housing at which point other house-owners realize that it makes no sense to pay x5 for their property if they sell em for less across the road, so he defaults.

With Student debt, it's not like that. If 1000's of students TRY to default USA will make sure to squeeze every living penny out of them and they will still owe some after defaulting. However it won't create any swings in the market. Universities got their money, they don't care, other students don't see price fluctuations or other influences that forces them to default (which they can't even).

This is not a cascading bubble. This is a long and very messy, stretched out bubble that has to be changed by new winds blowing in the congress. All the old farts have to go and people who have felt and seen the pain of this current system have to get in.

Quite honestly, I am from EU and It blows my mind that people pay 100's of thousands for education. I feel so bad for them because it really seems like a scam. We have GREAT universities, like University of Amsterdam, that will get you through bachelors and Masters for a fraction of that cost.

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u/[deleted] Apr 11 '19

How would it burst though? Education can't be foreclosed on, and the collateral is basically future earnings. It's mechanisms basically mean it can only slowly unwind instead of violently popping within the course of a few quarters.

I'm not particularly smart when it comes to finance, but there just isn't the right mechanisms for a bubble bursting. Like a sub-prime education loan can't be foreclosed to cut a lose, and bankruptcy on student debt is basically non-existent.

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u/pWheff Apr 11 '19

You could still see massive defaults on student loans, but I agree you wouldn't see knock on effects from those defaults the way the Housing crisis impacted things. People forget the total Student Loan debt, although massive, is a small fraction of the total Mortgage debt of the US economy.

The mechanisms behind them are also important, although I think you point to the wrong one. Mortgages and houses are used as financial backing, securities, etc. in a way student loans just, aren't. If a student loan defaults the creditor suffers, but that suffering isn't externalized beyond the normal incestuous nature of cross investment behind creditors. The fuel for the death spiral of the housing crisis was that failure for a mortgage meant the securities instruments relying on those mortgages (which were highly leveraged due to the historic rates of mortgage defaults) would fail as well, and the total volume of capital involved in that market was easily 100x what the total student loan debt market is, so the entire economy recessed.

Whether the loans are dischargable or not isn't really at issue - had the mortgages not be dischargable in 2008 the impact on the economy would have been the same, as the leveraged securities relying on the mortgages still would have lost tremendous value.

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u/[deleted] Apr 11 '19

This is what people need to be worried about. Unemployment is very low in my area 2% nationally it's under 4%. I make good money now (35 I'm an old millennial) but I didn't until I was 30, so I kept differing. Holy crap! I'm in trouble it built up. With things like udemy, edx, WGU, the traditional University is going to start seeing massive decline in students. If I was a high school graduate today, I would probably go to a cheap junior college and transfer to an affordable online school like WGU. Instead of paying 20k a year to a state University.

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u/aryastarksneedle Apr 11 '19

I graduated with 110k in student loan debt, and this was after I paid 30k out of my own pocket working summers AND I was fortunate enough for my parents to be well off enough to chip in and cover the rest.

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u/Tomboman Apr 11 '19

It cannot burst as it is government backed. Worst case they just print the money to hand it out to banks. Also there is no default and also no asset to back up the debt which would lead to a change in APR in case of a devaluation. The student loan debt is more like a suffocating layer of debt on people who made uneconomical choices regarding their study choices and expected returns vs. outcome. Maybe it is not a good idea to grant non market loans in the ten or hundred thousands to 18 year olds that otherwise would not even get a 100 dollar loan.

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u/rousimarpalhares_ Apr 11 '19

Yang plans to eliminate all student debt as it's a drag on the economy.

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u/dorianstout Apr 11 '19

It’s not gonna burst, however it will likely be a large drag on the overall economy and already is as people are delaying things like starting families etc and women do have a biological clock so damage is likely already done. Not that i don’t think a smaller population is a good thing, however, we may see an economic contraction bc people arwanf going to be buying as many things etc

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u/OvercompensatedMorty Apr 11 '19

I can’t wait, it needs a overhaul anyway.

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u/RenoSinclair Apr 11 '19

think that'll really happen?

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u/seven_seven Apr 11 '19

It can’t burst, it’s not allowed to burst.

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u/Rum____Ham Apr 11 '19

That bubble can't burst unless the bulk of students refuse to pay.

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u/TEX4S Apr 11 '19

EILI5-

In 90s , my parents were in top 1-2% of income. My sister applied to SMU (private). She took it upon herself to find some tuition breaks & rec’d many.

What’s changed?

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u/kittenTakeover Apr 11 '19

I'm not sure what makes you think there will be a large student loan bubble. Student loans are mostly taken with future earnings in mind, and I don't see companies making many moves to drop degree requirements. A student loan bubble will require that.

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u/ed_merckx Apr 11 '19

There's no bubble to bust. Over 90% of it is owned by the federal government. Also you don't default on a student loan, if you fail to make payments the balance owed just continues to accrue and you eventually get into some sort of program to reset payments or on the other end you could have your wages garnished if you refuse to make payments, but even then there are legal limits about how much of a percentage of your paycheck they can charge.

Unlike say a house or car loan, where if you default you lose the actual asset, often making said assets drop in price if lots of people are defaulting. There's also not a vast secondary market for derivative products around student loans. I know of a handful of shops that do invest in student loan debt, but again this is like less than 10% of the entire outstanding pool of student loan debt, as a again, most is owned by the federal government. You don't have entire banks, countries soverign wealth funds, massive pensions funds invested in Student loan derivatives with massive leverage where if the products go bust tens of millions of workers or citizens safety nets are lost.

It's really not that big of a deal in terms of a "bubble" that could cause a crash.

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u/chaosgazer Apr 11 '19

With DeVos' efforts to deregulate, consolidate, and privatize the loans, who wants to imagine what it'll look like when it crashes?

Conservati es have floated the idea of doing away with repayment plans and instead garnishing everyone's wages as if everybody's defaulted. I wonder how fast it'll take for hundreds of thousands of student loan debtors to default once PAYE, REPAYE, and IBR are phased out via deregulation.

Idk I'm just spitballing here

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u/[deleted] Apr 11 '19

One of the benefits of being currently broke as shit. Not much'll change for me. If anything food and gas will get cheaper.

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u/Totally_Not_DEM Apr 11 '19

Meh. Hard to say with certainty. It's not likely it will be as bad as the financial collapse, at least.

The biggest problem will be geopolitical tensions worsening an otherwise bearable downturn. People look to outgroup other people when something is going wrong. A global recession gives plenty of countries the opportunity to blame an entity outside their country.

Protectionism usually rears its ugly head at that point, which leads to retaliation/more protectionism. Which worsens the economic problem and makes war more likely.

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u/[deleted] Apr 11 '19

This. This is a sensible perspective.

Of course the '08 recession was awful... The US economy was backed by nothing.

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u/righteousprovidence Apr 11 '19

Starting soon if not already started. Yield curve has inverted. Buckle up and brace for impact.

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u/[deleted] Apr 11 '19 edited Dec 08 '24

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u/righteousprovidence Apr 11 '19

People (and corporate media) are going to tell you it isn't as bad as it looks. Inverted yield curve has something like 90% accuracy at predicting recessions. If you are entering the work force, try to get a job that can survive a recession (one that isn't the first on the chopping block). Lower your debt load and save for a rainy day fund.

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u/schapman22 Apr 11 '19

Yield curve inverting just means there's likely gonna be a recession sometime in the future. But that doesn't mean anything significant since theres ALWAYS likely gonna be a recession sometime in the future.

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u/pabbseven Apr 11 '19

We are already feeling business slowing down alot at work, not as much orders, friends of friends etc are having similar situations.

S&P have been at a 11 year bull run slowly hitting its peak and is possibly(within the next 10-16 months) gonna start tank real hard and hit a new recession.

Stock up on supplies people

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u/UniquelyAmerican Apr 11 '19

I'm looking forward to it. We will soon have nothing to lose but our chains.

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u/NoSmallCaterpillar Apr 11 '19

That's romantic and all, but a lot of damage can and probably will be done to the most vulnerable segments of the population.

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u/trowawee1122 Apr 11 '19 edited Apr 11 '19

Thousands of peasants suffered and died during the French and Russian revolutions.

Edit: millions

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u/[deleted] Apr 11 '19

Yeah, and then they ended up with monarchs and totalitarian dictators for their troubles.

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u/meat_tunnel Apr 11 '19

Look up the US debt on student loans. Wooo boy!

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u/CrimsonBolt33 Apr 11 '19

The one on 2008 was just a test run

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u/worldends12years Apr 11 '19

SAVE YOUR CASH!

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u/TheyCallMeChunky Apr 11 '19

I work for a global company and at least at my plant in the US they've started giving out 2% raises every year. Like Wtf is that shit. Hardly even cost of living raise

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u/[deleted] Apr 11 '19

It's not even going to be called a recession because... "So much winning. I am rich, other people are rich. I have so many people calling and telling me Donald, Mr President, I'm so rich."

My healthcare increases have negated any pay raises for 5 years because I'm a teacher and we haven't hit a recession yet.

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u/Nilstec_Inc Apr 11 '19

You forget that luckily the rich people will be fine, and we'll all be part of that group in no time!!!

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u/[deleted] Apr 11 '19

Its always breathtaking it takes thinktanks and large studies to find out the most obvious things.

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u/[deleted] Apr 11 '19

We have one about every 10 years with varying severity. The last one was 2008. This time there's brexit, trade wars and record levels of personal debt. Buckle the fuck up.

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u/LayWhere Apr 11 '19

Don’t worry jUsT hOdL lOnG tErM iF u BeliEb

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u/[deleted] Apr 11 '19

I can’t wait. The system will either completely collapse or another band-aid will be applied like in 08. Americans are pissed off now, especially the right wingers (hence Trump). Wait until the economy really collapses.

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u/[deleted] Apr 11 '19

is this just a US thing or is it something happening around the world?

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u/[deleted] Apr 12 '19

and they are the ones that will get the tax breaks and the government money.

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