Anybody who has ever been a first responder to a disaster or has been hired to restructure a business knows you start with the big issues first. You don’t treat symptoms until you can stop the bleeding. Why is it today we are focussed so intensely on minor social causes when so many young working families are finding it hard to pay rent and put food on the table?
Without getting too uppity, let’s look at the numbers on Trans Rights and some of the key issues on the table. Trans people account for less than 1% of the population. Trans rights organisations cite higher levels of violence and discrimination against trans people, increased health related issues as their reasons for existing and requiring taxpayer resources. Regardless of the specific instances, it cannot be a big number, it isn’t a big number.
Trans people are protected under the same rights of whatever country or gender they identify with. In western countries wealth and reputation are the only true status indicators. I might be out of line when I say Trans people have issue mostly with how they are perceived. There is great danger in attempts to force respect. You’ll get resentment instead.
Contrary to what Black Lives Matter (BLM) protestors will have you believe, there is no statistically significant difference in the percentage of white to black people who experience police-initiated contact. The overwhelming majority of police interactions are peaceful in western countries. I have fair skin, although I am from two second-generation migrant families (displaced from Europe). My two main family backgrounds experienced discrimination from the predominantly English population when they arrived. Discrimination occurs everywhere, everyday. That’s not advocation, that’s just a statement of fact. Nature has far harsher discrimination and competition than humans do. Birds will eat each other’s eggs.
The earth’s climate is warming, almost nobody denies this. But what is not made clear is the natural cycles of warming that do not fit with current narrative. I wrote more about climate change here...
Until about a decade ago I was an advocate of climate change. Today not so much. The focus on habitat loss and water quality has all but disappeared. Today we hear stories of fiery death and the need for expansive solar arrays, wind farms and open cut nickel mining. All the while the renewable energy industry is now over a trillion dollars in value and mining more, using more energy and importantly costing households more in overall.
Why so are these movements being pursued so aggressively in the legacy media?
Yes, a lot of this is about money, but that is not the entirely story. It’s about status. Social movements are as much about flipping social and economic hierarchies as anything. You could be forgiven for thinking it was nothing more than anarchistic behaviour driven out of dissatisfaction with personal achievements.
Those of you who have studied economics and finance will understand the concept of intergenerational wealth. It’s almost impossible to compete against if you didn’t come from a wealthy family. I can’t fly either. No point being angry about it. People form wealthy families generally retain or augment their wealth. Having access to education, opportunities and capital investment makes a huge difference. Wealthy people can fail more often and still recoup their positions because they have safety nets. Out of the world’s richest people almost over sixty percent have come from wealthy families or at upper-middle-class backgrounds. There has been a shift over the past decade with some individuals from the high-net-worth sector originating from middle class backgrounds, although this is likely to have been influenced by the tech industry. What you can glean from this is, wealth offers specific opportunities that might come about for completely sensible and just reasons. I have received about 4% of my father’s estate, he, 0% of his. Life sucks.
But I’m not interested in high-net-worth individuals. They are by nature an anomaly representing 0.0.something percent of the global population. The data analyst part of my brain would suggest moderate levels of wealth, such as those found in the middleclass would tell us more. It’s this sector that is changing most radically, it’s shrinking and becoming wider, it’s not from people moving upwards, it’s from more people falling off the bottom at around 0.25%PA and some people pushing up the ceiling.
is the middle class dying?
Firstly, defining the middle class is problematic for a host of reasons. Rather than using hard numbers it’s defined as ‘any household with reasonable amount of discretionary income or roughly a third of their income left over after food and rent/mortgage’. Average wages, house prices and other all-encompassing indicators are misleading when you take lifestyles into account. What we can all agree on is the rise in energy costs affecting household budgets. Energy and economics (on a wider scale) are conjoined. Income and energy consumption are so closely correlated they can be applied universally. Changes to where energy subsidies were being directed and the increase of cost to production have driven up inflation on everything that arrives on your doorstep. It’s true Covid put inflationary turbo on the economy, but energy costs were the engine.
There are equally as many causes for energy costs rising as there are sources. I am yet to hear a more convincing argument than the push to walk away from a fuel source that was cheap, accessible and safe to manage. As we in the west walk away from fossil fuels they will still be burnt in equal or greater volumes by countries that have no control over emissions. It will achieve nothing except make life more expensive over here and easier over there.
Part of the problem in the west is the lack of understanding about the changes needed to electricity networks to support renewable energy. Grids need to be redesigned and rebuilt to accommodate thousands of generation points. These grids were built over a period of one hundred years and now we will be asked to fund a significant upgrade over a very short period. These costs are being passed down to the consumer. But that’s not the whole story. Today households are needing to provide for their own daytime power generation in the form of solar arrays. If you want power out of hours you need batteries unless you intend to use mains feeds at night. Some households making excess energy are having to pay fines because its causing problems for the grid operators.
The other thing that seems never to be factored in is the loss of mining royalties in countries that have energy on tap. The reality that most renewable energy hardware is manufactured in China, a country that still imports fossil fuels to use themselves. This all adds up to lost revenue for governments like the US and Australia. Lost revenue means lower credit ratings, higher interest rates and less money for welfare, education and other social programs. Fossil fuels were blue chip investments. Cancel culture saw the divestment of mining shares and that’s likely to have led to increased costs effecting downstream prices as well.
And a message to Climate Alarmists. Renewables are highly unlikely to ever cost less than they do now, they are heavily subsidised by governments and like tech Startups they are using capital investment for operating budgets. Once that dries up… But my main bitch is that by design renewable energy infrastructure is more complex and needs more space. Renewable hardware has a vastly shorter lifespan and more points of failure than fossil fuel infrastructure. It’s reliance on lithium batteries, the same technology in iPhones is quite frankly pathetic. There is a lot of talk about next generation batteries, although from my investigation they are merely incremental improvements on the same technologies. This gives them less time to recoup their investment due to their 5-year lifespan. Renewable energy companies don’t care as they will sell more as a result.
The great Boomer check-out
Most of the baby boomer generation (1946 to 1964) are now either retired, in aged care or dead. Boomers were to reason credit was cheap and house prices rose above a years salary. There were literally so many of them driving growth, cash rates were as low as we are ever likely to see them. Most Boomers have cashed out their retirement funds and spent them on hedonistic pursuits or simply aged care.
When Gen-X retires (already happening) we will see further pressure on cash rates because Gen-Y (millennials) simply don’t have the investments as the preceding generations did. The Gen-Y portfolios that do exist feature stocks that did not typically return a steady profit and are often volatile like Twitter, Tesla and Crypto. This is to do with a fundamental misunderstanding of the Stock Market’s purpose. I wrote more on generations here...
So what to make of all this. I think it’s safe to say house prices will remain high due to the increased cost in building them. Electricity will remain high with home solar arrays and batteries replacing the OpEx with CapEx. The cost of Entertainment is likely to increase as streaming platforms are forced to produce more of their own content and actually turn profits. The cost of food will vastly stay the same but drop in quality. Some items will become prohibitively expensive like meat and speciality foods. Education costs will rise with inflation and I’d expect governments to start to reduce funding to government schools. They will need to offload the funding of education via a user pays scenario as less people have kids.
Health and Aged care will continue to rise in line with inflation. Governments may need to spend more due to the rise in the population entering aged care and less of those able to self-fund. Blame the cruise ship industry.
What’s the fix then? Well, It unlikely that reallocating all wealth from high income individuals will help. High net worth individuals account for only 13% of total wealth. While the concept of wealth caps probably should exist as an ideology, it would be almost impossible to enforce because of the mobility wealth affords. I think Private jets and Mega yachts don’t need to exist. Nobody needs more than one holiday home.
A public register of who owns what and public shaming might work. Lets get creative.