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B.C. boomers have lost their moral authority to judge Millennials

Recent events in the province illustrate why the popular boomer narrative that Millennials are an entitled bunch is so galling


 
People shout slogans for social housing as they attend an anti-Olympics rally in central Vancouver, BC, Canada on February 12, 2010. (Yuri Kadobnov/AFP/Getty Images)

People shout slogans for social housing as they attend an anti-Olympics rally in central Vancouver, BC, Canada on February 12, 2010. (Yuri Kadobnov/AFP/Getty Images)

For years, we have been hearing about the entitled nature of Millennials. The story goes that those born in the ’80s and ’90s grew up on participation awards and inflated self-esteem. They were told that the world was their oyster and that they should follow their passion. The cautionary tale, of course, is that this set of values came at the expense of building the grit and work ethic that their elders had. Whenever someone in the younger generation complains of accessing affordable housing, or poor economic prospects, the comments section blasts their entitlement, lack of work ethic and realism, and points disapprovingly to the fact they can afford a flat-screen television and an iPhone.

But this past week has given us a prime example of why this narrative is so galling to the Millennials. British Columbians were greeted with the new property assessments. Property owners—largely generations senior to Millennials—saw their property values soar by hundreds of thousands of dollars. Suddenly, the $570 homeowners grant or HoG—a property tax subsidy whose full value was restricted to homes under $1.2 million—was in question for a number of newly minted millionaires. The media covered senior citizen homeowners worried about where the $570 would come from, some claiming they would need to move if the ceiling were not raised. Within days, provincial politicians were assuring these millionaires that the grant threshold would rise to $1.6 million. Crisis averted.

To understand why Millennials would rightly feel that this is a moment where senior generations lost whatever moral high ground they once had, we must compare this episode with a file that impacts Millennials.  For about 15 years, the B.C. Liberals have been crying poverty when it comes to improving supports for the young. They presided over an unprecedented increase in university tuition, including moves to increase tuition by over 300 per cent in the most job-oriented fields of study: law, medicine, teacher education, M.B.A.s. Baby Boomers received highly subsidized degrees in those fields. Millennials are expected to pay the full freight, or nearly so. Add to this story the fact that if you need a loan for school, you must first prove you don’t have the financial resources to pay yourself. Provided you meet that standard, your loan carries a fixed-rate option of prime plus five per cent once you graduate from school.  Students have been advocating tirelessly to improve this deal. They have had precious little to celebrate as a result of their efforts.

Now, let’s turn back to the plight of the millionaire homeowner. Take the case of the 60-year-old homeowner who has lived in their house for 30 years—the very people that politicians are trying to protect when they increased the homeowner’s grant (HoG) from properties valued at $1.2 million to properties valued at $1.6 million.  Where progress in advocacy on student issues is measured in years, their progress was measured in hours. Homeowners deserve to stay in their homes, after all. Given that the benefit is not connected to income or any means test as student loans are, Millennials can conclude that the B.C. Liberals believe that somehow even the wealthiest of homeowners deserve a handout, too. While the B.C. NDP was a bit more nuanced in its position, this was a decision welcomed by both major provincial parties in B.C. and by city politicians. This was all on the premise that those who got into the property market a long time ago and have had an unprecedented gain in their net worth wouldn’t be able to afford the property taxes that come with their windfall.

This position conveniently ignores another program that also assumes that those who cannot afford the carrying costs of their homes need government assistance. The B.C. Property Tax Deferral program allows anyone over 55 to defer their taxes and pay an effectively fixed simple interest rate of 0.7 per cent. While many seniors quite justifiably rely on this program to make ends meet on a fixed income, there is no means test for this program. B.C.’s most famous billionaire, Jim Pattison, would qualify. What impact does this have in dollars and cents? $10,000 in unpaid principal under the property-tax-deferral program costs the homeowner $700 in interest over 10 years. Meanwhile, $10,000 in unpaid principal under the student loan system costs the graduate $11,800 in interest over 10 years. Is this fair?

Rather than ensuring that millionaires can afford the property tax on their homes, the HoG simply reduces the amount homeowners need to borrow to avoid the cash flow problems caused by their windfall.  Even when homeowners borrow, they do so at a tiny fraction of the cost of student loans. Despite this fact, we had massive political pressure to solve the “crisis” homeowners face because of the appreciation of their properties.

As nearly all homeowners are receiving this grant, those that are getting the short end of the stick are those who don’t own homes. A non-trivial proportion of this category are Millennials who are working their way up toward homeownership and who have been told to lower their expectations about what they “deserve,” especially when it comes to living near where they grew up.

The $820-million HoG program could be put to better use. Lowering student loan rates would be an option. A $1,000/yr grant for every child in B.C. would be another—as that’s the approximate cost of the current HoG. There are any number of programs that would be a better use of this money, but it would take a political magician to navigate a change without losing too much support from older voters.


In all this, though, we have a deeper unexamined and very valid policy question. Should government be in the business of keeping seniors in homes they cannot afford? Seniors who can’t afford to keep million-dollar homes have options. They can take a renter, they can downsize, they can take out a reverse mortgage. At a personal level, it is challenging to give up the family home. It isn’t the fault of the senior that their once-modest bungalow in the burbs is now a hot commodity. That said, for every story of a senior worried about staying in their family home, there is a story of a young person unable to find adequate housing and even the odd tale of couples living in vans. In many cases, the seniors defending their entitlement to stay where they have been living for years involves a single person or a couple living in a four- or five-bedroom home. This is not so much about having adequate housing as it is about staying in preferred housing. Being priced out sucks. But seniors get help when they get priced out, while young people who argue that there should be better options for them, even if they don’t have a million dollars, get labelled as entitled.

But the situation is far more intertwined even than the above analysis suggests. A major strand in the Vancouver housing affordability debate has been about why housing is so astronomically expensive. The culprits boil down to lack of supply, no new land, increasing population and foreign investment. For most of the past several years, the B.C. government has explicitly avoided doing anything that might cause a decline in home values. We were apparently supposed to celebrate the windfall that foreign capital flows had on our markets. Again, this was a policy direction aimed at funding the retirements of Boomers at the expense of the future of Millennials, or as one B.C. MLA told me, this windfall can be used by Boomer parents to help out their kids. Many will and some won’t, but what this MLA was unwittingly endorsing was the move away from meritocracy and toward the creation of a landed gentry: if your parents were lucky enough to win the property lottery, you can hope for a piece of it.

The first problem to tackle is the influence of global capital inflows on distorting the housing market—some moves have been made, but more is needed. We also need to increase the pace of densifying the core neighbourhoods in B.C.’s cities, despite pushback from those in the Boomer generation who want their neighbourhoods to remain largely unchanged.

While it is essential to address the above issues, we should be evaluating why we use tax dollars to forestall seniors from downsizing. There is good reason to support seniors to have adequate housing, but is there a compelling reason to make it a spending priority of government to ensure that seniors continue to live in large and largely empty houses if they can’t afford them?

Housing turnover is what creates supply in the highly constrained market of single-family houses. Government interventions that reduce the pool of sellers has an inflationary impact on prices. Public policy has to balance the needs of all citizens and currently the upcoming generation is paying into programs that help freeze them out of finding adequate housing. The policy ecosystem has become unbalanced. In the ’70s, when seniors’ poverty was far higher, and the housing markets were connected to local incomes, the existing policies made some sense. Presently, however, Canadian seniors have a low income rate that is approximately half that of working age Canadians. The problem of seniors needing to downsize doesn’t seem as important as that of young families who face inadequate and/or crushingly expensive housing. Even if these two issues are equally important, that suggests that government should not be redistributing funds from the younger generation to the older generation to keep them in their houses, as they are doing now.

So, we have a tale of two British Columbias. On one side, we have the British Columbia where the housing lottery winners deserve to be shielded from the challenge of facing life without a $570 annual subsidy. On the other side, we have the entitled Millennials of British Columbia, Millennials who must lower their expectations in the face of wage stagnation and housing cost inflation.

It is no wonder Millennials are galled whenever they hear their elders trot out the tired line that Millennials are entitled. Watching those same elders protect their HoG entitlement while they gradually dismantle the supports that helped them in their youth demonstrates why this characterization is utter hogwash.

 

Stephen Price is an educator, borderline Millennial and renter who lives in Vancouver. Follow him on Twitter here: @YVR_P.

 

 


 

B.C. boomers have lost their moral authority to judge Millennials

  1. Time to work you Starbucks sipping, protesting hipsters. And time to save. Get out of school and into the real world. Don’t wait until 30 to finish school and then complain that the world has left you behind.

    • Read a book, learn something you,greedy, overweight, complacent, yuppy defacto Trump supporters, slowly destroying the country that your parents fought and died for so you could betray their sacrifice.

      Because of Yuppy greed there are no jobs out there for Millennials when they finish school or for decades after.

      Because of Yuppy greed, condos are selling for $1M generating enormous profits for Trump'[s pals down on Howe Street, condos that cost $100K to build and could rent for less than $400 a month if built for the cash your BC Trump Party is spending building the worthless Site C dam.

      Unfortunately by refusing to vote Millennials are letting Yuppies that do, mess up their life. Get out and vote this May, and give their fat backsides, a boot they won’t be forgetting.

      • Replace the word Trump with the word Trudeau in your rant. We are in Canada.

    • Time to let go of all that anger. If you’re a boomer, who do you think will be wiping your bum in your last years of life? It won’t be members of your generation. All that “take responsibility for yourself” nonsense might end up biting you very hard if you live long enough to need long term care.

  2. Obviously written by a millenial… Millenials don’t have the moral authority to blame anyone else.

    Just because you own a $1 Million house doesn’t make you a millionaire, or even rich. All it means is you have good credit…

    The boomers are the people who started the Peace Corps, Greenpeace and other organizations concerned about social equality. As a boomer I was told “my world is my oyster” so nothing changed there. The biggest difference is we didn’t lay the blame for the problems we had in the 50s & 60s on anyone but ourselves. Blaming the previous generation doesn’t do squat.

    Now get out there and change the world!

    • Owning a $1 Million house doesn’t make you rich?

      Maybe not…but you definitely need to be rich to buy one. Do you not see the problem with that?

  3. They’re both entitled. Meanwhile, the middle gen-xers are squeezed. Get the dirty money out of the housing market if you want prices lowered. The Lower Mainland is just a laundry.

  4. It amazes me how we become so divisive and play the blame game.
    Life during the baby boom years was so different than today.
    Boomers and Generation X raised the millennials, so if there are entitlement issues there is only one place to look for the cause…..that’s within each person.
    Is there a problem? Yes? But squabbling and writing trash like this does nothing except fuel an unnecessary fire. It’s so tiring!!
    Why don’t people come together and work towards a solution…..may show a real level of maturity.

  5. If you want our seniors care system to remain viable, you need to keep those baby boomers in their homes as long as possible. If you want to increase rental housing, you need to keep people out of the rental pool. Squeezing people out of their homes $570 at a time makes no sense – especially when that valuation gain is fictitious until you actually cash out. Anyone remember 1982?

    • Moving two seniors out of a 4-bedroom house, and moving a young family of four into that house reduces the rental pool by two. Why would you take a fictitious valuation gain when you could have an actual gain?

    • Yes, I remember 1982. We were forced into a depression by Trudeau with 20% interest and the national energy plan. Now we will have the national carbon tax.

  6. This divisive and obvious *clickbait story overlooks several facts: (1) Property tax increases more than offset the homeowners’ grant, so raising the threshold for this grant is insignificant in terms of individual tax relief and cumulative government revenues; (2) Greater Vancouver Millennials who have managed to buy their own homes have done so by being employed in highly paid skilled jobs, or leveraging their parents’ Greater Vancouver property. All the rest should be prepared to move to more affordable cities; (3) Downsizing would be great for seniors were it not for the fact the transaction costs for such a move average $75,000. Also, by moving to a multiple unit dwelling seniors run the future risk of being exposed to the negative cognitive effects of Millennials’ pot-smoking rights; (4) Nobody is asking why the disproportionate increase in tuition fees. *Inundated with ad’s targeting over 55’s.

    • There have been no studies successfully linking pot to worse cognitive functions.

      There is a serious disconnect between the older and the younger. My dad could support a family of 3 on a entry level wage in the 60’s. He told me to my face that it was impossible to do that today, -0 years ago. So do you really think people my age are lazy or is there something else going on

    • “Greater Vancouver Millennials who have managed to buy their own homes have done so by being employed in highly paid skilled jobs, or leveraging their parents’ Greater Vancouver property. All the rest should be prepared to move to more affordable cities…”

      And if everyone who isn’t employed in a *highly paid* skilled job moves away from Greater Vancouver, who exactly is going to clean the office buildings and hospitals, pick up the garbage, drive the ambulances, take your appointments at the doctor’s office, babysit your kids, do your dry cleaning, serve your food, or stock the shelves at any retail establishment?

      • The endless supply of young people who think they can survive in Vancouver from the rest of the country who move back home after 2-4 years of struggle. Only to be replaced by two more just like them.

  7. Those Canadians who’ve been watching the US Twilight Zone lately should know by now that divisiveness leads to tyranny.

    I’m a boomer, but I don’t have a million-dollar home… not even close; however, I do empathize with those fellow seniors who, largely through luck and hard work, are property-rich and cash poor, and who may be threatened with losing their homes when property taxes increase. It does no good and, in fact, a lot of harm when we criticize Millennials–or any other generation–and it harms all of us and our country when we contribute to division and backlash from those born in a different generation.

    I see divisiveness in many of the comments thus far, and it scares me.

    I feel fortunate to have been born a boomer because I believe my generation has lived through what may turn out to be the best years of history. I don’t care whether Millennials feel entitled or not. If they do, then perhaps the boomer parents are to blame, but no matter who might be to blame, every generation needs to join with other generations to ensure that The Trump Virus does not infect Canada.

    I do care about citizenship: becoming informed and taking an active part in politics and public affairs, no matter how small that active part may be. Those in the US who did not take their citizenship responsibilities seriously are now paying for their apathy.

    Please respect each other and work together to make Canada safe from tyranny.

    Given what is likely to happen in the US very shortly, Canadians of all generations

    • delete the last line… I don’t know how to edit, and I didn’t proofread well enough.

  8. This article left out an important fact. Not every senior citizen is a baby boomer. The baby boomers are the young seniors. There are old seniors, some of whom are still living in their houses. I live next door to a 90 year old. There is also the gen-Xers and then the millennials. I am a baby boomer…at the tale end and I am not yet 55. I sure don’t plan to leave my home and I don’t consider it my fault that interest rates dropped so low that real estate was able to go so high. If interest rates were at 12 percent (the rate when I bought my house), the housing market wouldn’t be where it is. I paid much less for my house in 1990 but the payments weren’t a lot less than more expensive houses are now because the interest on the mortgage was so much higher. The interest rate was the deciding factor of whether a young couple could afford a house and what they could afford. Property taxes were not based on house value because houses weren’t valued that highly yet due to compound interest and high rates amortized over many years, we all paid two to three times the amount of the price of the house. It was our parents who purchased houses in the single digits that got a real steal, not us.

  9. The narrative that millenals are “entitled” comes directly from the development industry.

    This industry spends a lot of money in carefully bending public opinion in a manner that will keep the real estate gravy train going.

    This is the same group that keeps trying to convince us that questioning Chinese real investment is racist (it isn’t), that Vancouver isn’t expensive by world standards (it is), that we are running out of land (we aren’t) and that glass high rises are green (they aren’t).

  10. Stephen Price is to be commended on his superb example of yellow journalism “B.C. boomers have lost their moral authority to judge Millennials”. His distorted analysis and straw-man arguments are laughable. The only person passing judgement is Stephen Price.
    1. Firstly, I’m not a “newly minted millionaire” as he puts it. It’s not as if the increased value is actually real or disposable income. It just a number created in order to conveniently extract tax dollars. When the Boomer generation collectively falls off its perch, the most likely beneficiaries (after the government grabs their pound of flesh) will be the Millennials.
    2. “Crisis averted”? The only crisis is the potential loss of votes for the Liberal government. The whole bloated market is a result of government inaction.
    3. As to “moral high ground”, I’m not judging anyone. As if being a home-owner were a position to be defended. My millennial kids are all hard workers.
    4. As for the high cost of education, start by looking to over-paid tenured types and ridiculously priced texts. When student costs in Quebec soared they didn’t sit on their fat backsides – they got out on the street and protested. I wonder – what is the percentage of Young Liberals in the university system? Vote the Liberals out or quit whining.
    5. Price’s “plight of the millionaire homeowner” sarcasm is particularly obnoxious. I’m a sixty year old homeowner and believe me, the government is not protecting me in any way. What the Liberals are trying to protect is votes. This homeowner grant is not a “handout” as he puts it. The Liberals take that money out of my pockets to begin with, then crow about their generosity when they give it back. The grant was a thinly veiled vote buying scheme to begin with and no government seeking re-election is going to cancel it. As far as the home-owner grant goes – get rid of it I say.
    6. Price’s suggestion that “the $820 million HoG program could be put to better use”. REALY? Listen pal, if any provincial government ever gets the guts to cancel the grant, just reduce the taxes by that amount and quit playing games.
    7. “Should government be in the business of keeping seniors in homes they cannot afford?” This is classic misdirection – smoke & mirrors question. It was affordable. Due to federal, provincial, and municipal dithering regarding housing policy we are now faced with a bloated, unrealistic housing situation that is only going to get worse. You only have to look at the house of cards collapse of the US market in ’06. Houses are not commodities – they are HOMES.
    8. “the culprits of supply, no new land, increasing population, and foreign investment.” Well, a lot of blame can be attributed to foreign investment as far as I’m concerned. 4 houses were sold across the street and NOT 1 OF THEM is being lived in by the owner. NOT 1 YOUNG FAMILY has moved in to those houses.
    9. As to “redistributing funds from the younger generation to the older generation” – WHAT A CROCK that is. I hate to wake Stephen Price from his dream state, but just because I’m a senior doesn’t mean I don’t pay taxes.
    10. “housing lottery winner” This just kills me. We paid into a mortgage for 30 years, what the hell are you talking about – lottery winner? I can tell you one thing: the dollar I earned 40 years ago has devalued more than the price increase of my house.
    Would you like to know why housing is unaffordable Stephen? Because cities like mine (Burnaby) keep issuing demolition permits for perfectly good houses. The house across the street was built in 1967. It’s a bit dated and could use updating but the building is perfectly sound and built with better materials than most new houses today. It would be perfect for a young family just starting out. I should have been so lucky to have a place like that to start out. However, it will be turned to matchwood and in its place will be a monster house worth $3 million. That’s why there is a housing affordability crisis Stephen, not a crummy $570 subsidy.
    Stephen Price – you are a poster-boy for Whiny Millennials. I can only hope you don’t teach Truth in Journalism or critical writing or something like that. Please note: there are whiners in every generation. Out of curiosity, is that your photo on LinkedIn? You know, the one on a large sail boat? The poor, millennial, educator, renter?

  11. I always have to laugh when I read this nonsense. Millennials: most of what you have, you got for free. Your overprotective mommy drove you to and from school from day one, your parents competed with other ones on how much they set aside in your RESP government subsidized programs, your after school activities are all covered as well. All they ask you to do is study hard, be creative and smart. But no, you have a different plan, you demand the education be free (no loans), you want to drive the parents and the grandparents out of their houses because you envy what they got. Oh, and your brilliant plan is to live in the most expensive city in Canada. And you want your parents’ wealth NOW, not after 30 years of hard work. Now. Stop whining and go to work, nothing builds the strength better than a struggle, ask any bodybuilder. It took me 8,000 km and a new language to find a good job. And take your stupid iPhone off your ear when I talk to you, I am paying for your phone too! :-) (come in 30 years and tell me how you did, otherwise you have no argument)

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