When it comes to change, we’re all a tad on the slow side. We’re a bit slow as individuals. We’re a bit slow collectively as well. Things change, but we don’t.
I’m not saying this to add yet another bruise to the body politic.
It just occurred to me that the comfortable world represented by “Ozzie and Harriet” is so far behind us that most truly middle-aged adults, let alone young people, won’t recognize the reference. The Ozzie and Harriet world is so far gone it has never been part of their experience. Indeed, millions of adults have never heard Ricky Nelson, the late rock star son of Ozzie and Harriet, sing “Garden Party.” His hit song, now 38 years old, was well after the legendary age of Ozzie and Harriet.
In spite of that, most of us are still living in an Ozzie and Harriet world when it comes to our economic decisions. So maybe it’s time to rethink things a bit. Maybe it’s time to reboot. Like Camelot, it’s not clear how long the world of Ozzie and Harriet actually existed. But it was a world of secure employment, rising incomes, rising home values, and rock solid health benefits at work. It was also a world where a doting corporation saved and invested for you, bestowing you with a lifetime pension when you retired. It was a world with no fuss about plan options and no discussion of whether your contribution was matched, or not.
Your employer did it for you. All of it. It was part of the deal.
It was also a world where home mortgages came at low interest rates. It was so stable a world that you could borrow lots of money and be pretty sure you could pay it back with tomorrow’s inevitably larger paycheck.
It was a sweet place.
Many dates are offered as markers for the end of that world. But most of them began nearly 40 years ago. That’s an entire generation.
What were the marker events? Take your pick: the accelerating decline of union membership in the ‘70s, the first OPEC embargo, the 1977 decision to allow savings and loans to compete for deposits, the creation of 401(k) plans, the decline of pensions, the rise of forced early retirements, and the erosion of health benefits or the increasingly ragged uncertainty of employment. Whatever the transition events, we’re living in a new world.
We’ve been getting this message for literal decades. But neither we nor our institutions have asked how we should change our behavior to adapt to this new world. Our corporations don’t want to offer security of any kind, but they are eager for us to buy, borrow and consume as fearlessly as ever. They advertise accordingly.
Our government is the same. Whether the leader is George W. Bush or Barack Obama, the cure for ills remains the same.
Don’t just stand there, go out and buy something.
In fact, we can’t and shouldn’t.
If we’re going to live in an uncertain and insecure world--- and we are--- the only sane thing to do is change our behavior. We need to save more and borrow less. We need to obligate less of our income for debt repayment, not more. We need to own homes less often and rent more often. And when we buy homes, we need to buy smaller homes, not bigger homes. We need to approach our financial institutions with the distrust they have so richly earned. We need to understand that people may be our friends, but most of our institutions just see us as lunch.
So this isn’t about parsimony or a “new frugality.” It’s way less trendy.
It’s about personal security.
It’s about what you and I have to do to be independent and secure in a society that has, so far, refused to adapt.
We can be OK with that. We can even learn from the chorus of Ricky’s song. In fact, we can get really good at it.
But it's all right now,
I learned my lesson well,
You see, ya can't please everyone,
So ya got to please yourself.