Credit Crunch! Blame It On The Class of 1984!
How and why expectations have changed from my generation to my children’s generation. How this transition occurred, what changed in history to enable this.
Although this is mostly relevant to the UK, I am sure many parallels can be noted as significant in most of the Western world. There was social and economic change in America and Britain. This is a look at how and why expectations have changed from my generation to my children’s generation. How this transition occurred; what was social and economic change in history to enable this and why the cycle will be reversed.
I was born in 1968; the height of the 60’s revolution, when ‘power to the people’ was the advocate. There was a feeling of hope, love and unity. There was sexual liberation with the advent of the pill and opportunities for wealth.
Anything seemed possible. The UK was being re-built and stimulated growth. Great building programmes were in the throws of completion. Social housing projects were fulfilling the needs of those seeking affordable housing. At last people had disposable incomes as job vacancies outweighed supply.
Power to the People, Stagflation and the Winter of Discontent. Out with Callaghan, in with Thatcher. Let the Change Begin!
There were great changes during the 1970’s. No one could have foreseen the doom ahead. The 60’s were the party - the 70’s were hung over. Discontentment was starting to germinate as the hippy revolution turned from love, peace and harmony to creeping unrest. Political opposition to issues like nuclear war and Vietnam were products of this.
It seems that the idea of ‘power to the people’ was an idea that was starting to be implemented. From around 1973 the world started to suffer from recession. The party was well and truly over. There was an oil crisis, a stock market crash, high unemployment and high inflation (stagflation).
This had a marked affect on the world economy and Britain was no exception. Similarly, to our leader of today – Gordon Brown - the British people didn’t elect Jim Callaghan. He inherited his position as Prime Minister from Labour’s Harold Wilson. With ‘cap in hand’, Wilson went to the International Monetary Fund, for a loan. The UK, essentially, was bankrupt.
In 1979 Britain suffered ‘the winter of discontent’. Essentially, from the point of view of people power, the trade unionist was encouraging strike action. This was a backlash response to controlling inflation by freezing pay. The British people were disheartened throughout society. As a result, Callaghan was defeated by Margaret Thatcher (Conservative Party). This discontent was documented in the media and music of the time. Out with the happy hippy days, in with the anarchists (or activists?) – The Punks.
Our mother’s and fathers were brought up in wartime Britain. They had to endure rationing, family splits and went without clothes and toys. Christmas was a treat where, if you were lucky, you might get some chicken and a piece of cake! It is these things that our generation took for granted. Furthermore, some children were evacuated or had to fend for themselves whilst father was at war and mother was working for the war effort. They suffered social, emotional and physical deprivation.
The children of the 60’s were brought up with the ideal of ‘waste not, want not’. We were told to eat up ALL our food as waste was discouraged. Most things were recycled – we got money for bringing back lemonade bottles, for example. This was a great incentive. If there was wasted food, this went to feed the pigs. We ate our fish and chips in newspaper and used old newspaper for toilet tissue.
On our birthdays or Christmas, we might have received a token present - which was more than our parents got when they were children! If we were very good and lucky, we might have got a bicycle, but as this was a once in a childhood opportunity, we had to look after it. We knew that our family had to save hard and long for this gift, so it was appreciated.
We Ate Fish and Chips Wrapped in Newspaper - Yum!
Thatcher’s Britain took hold in the 1980’s things started to change. The rebellious punks, the trade unionists and the revolutionary rioters were controlled.
Our parents were role models for saving up before making purchases. They were paid weekly in cash, dispensed in brown envelopes. When we left school at 16, later than our parents did – they were working by 14 or 15 years old, we were paid like this too. We had to budget and make our money spin.
It wasn’t until Thatcher’s Britain took hold in the 1980’s things started to change. The rebellious punks, the trade unionists and the revolutionary rioters were controlled by Government initiatives. Psychological tactics were put in place to keep the people in line.
Ordinary folk were given just enough money so as they didn’t revolt, but not enough to be prosperous. Psychological barriers were created in government benefit offices. This was a tactical initiative aimed at belittling claimants, thereby dis-empowering them. Chairs, for example, were drilled to the floor and people were dealt with via a re-enforced glass panel, intercom and booth. When their number was called – they could have been waiting hours - they would be allowed to address their queries.
Brixton Riots of 1981
Where Does Money Come From? Trees? No..It comes from plastic!!
American Express? That will do nicely!
It wasn’t until the mid-1980 before my generation saw changes. We were encouraged to ‘get on our bikes’ and find a job. Many of us did this and migrated to cities, like London, where there was growth. Thatcher had implemented privatisation of our industries and everyone felt they had a stake holding in Britain.
We could buy shares in businesses, for example, which was only exclusive to the elite. The social housing that had previously been built, were sold off cheaply to their tenants, giving them a sense of worth. Everyone was encouraged to be entrepreneurs and now they had equity in their houses, they felt empowered to do this. This wasn’t only reflected in our economy and society, but in our music too.
Bands like Duran Duran demonstrated the high life in videos like Rio – cocktail bars, yachts, fast cars and power dressing. This had a direct impact on my generation – like all young people we were highly impressionable. It was during this time that credit started to creep in. We were starting to be paid monthly in our bank accounts, instead of weekly by cash. This was difficult. How can people make one weeks wage, last a month? That is where ‘subbing’ came into force and where, I believe, our spending behaviour started to change.
We found ourselves trying to ‘catch up’ on our spending, but instead found we were paying out now and going into debt until payday. The ‘hole in the wall’ was widely introduced – wow, easy access too! Then there was advertising: ‘‘American Express? That will do nicely!’’ Credit cards had now taking on a new meaning to spending. For a fee, you can have the prestige of being one of the select few in this club. Working class people had never had such opportunity before! This was a chance to make something of our selves, to do better than our parents.
The rot was starting to set in. We could have money whenever we wanted it. We could have the world now! We started to have mortgages, work long hours to pay for them and develop expectations that we could have nice, new things. We could ‘buy now, pay later’. We started to have children. ‘Why should our children go without, like we did?’ was our attitude. So, our children witnessed us going to ‘the hole in the wall’, take out cash and get them that toy that they wanted. It was easy! They must have viewed this like money growing on trees! It didn’t seem to come from anywhere. If it didn’t come out of the wall, you could always use a plastic card!
Boom, Bust, Stability - Boom, Bust - Credit Crunch!
During this time, we saw a boom and bust. House prices soured. House prices dropped. Many of us went through negative equity. Many of us were made bankrupt. Some prospered through this and bought their own homes – lower house prices = more affordability! And so the cycle started again.
Those who were trapped by negative equity became free again as another boom evolved. This time, credit was easier than ever and, as such our attitude to it became more accepting.
Now, we have another bust - the natural part of the cycle. We call this the credit crunch! We are told that lessons will be learned from this. World Governments will and have intervened, thereby changing our behaviour. My generation, who were encouraged to be entrepreneurs and go-getters, have learned to be selfish.
Previous Governments have advocated this. It is our children, therefore, who will behave more like our parents. The cycle is reversing. Credit will not be easily available. They will be encouraged to live within their means and learn to be prudent. They will teach their children the value of money, behave responsibly and know what it is to go without.
They will learn how to appreciate what they have. And this is where our grandchildren will look to us, the selfish generation, and aspire to be what we are today, the opportunistic ones. Credit will be easily available, as the younger generation forgets what has happened today - the cycle starts again.
Housing Slump in the 80's - Negative Equity - Credit Crunch
How and Why Did Expectations Change?
It is from a social, political and historical view, that helps explain why expectations are ripe for change. . It is this that helped the transition to occur. Politically, this is through legislation where Government’s mould society’s behaviour. It is always the people who reap the rewards and suffer the consequence of those decisions.
This has a direct impact on our lives. Socially, this has an affect on music, fashion, marketing and education. This influences young people and their peers. Young people are more adaptable to change and this affects expectations. Historically, my generation, when young, developed changes in expectations compared to our parents.
Politically, our Governments at that time advocated this. Socially, this came from influences in the media, music and social establishments. Example of this: American Express, Duran Duran and cocktail bars. It is because of these factors, my generation was encouraged to develop selfish behaviour.
This behaviour became established over time with the advent of credit, salaries by bank transfers and owning ones home. This encouraged a ‘buy now, pay later’ mentality. This is how the transition occurred.
The Cycle Will Reverse.
It seems that everything goes in cycles. ‘Boom – Bust’ followed by stability to ‘Boom and Bust’. This has happened since time began. One thing is… nothing ever stops still. Behaviours that enable this go hand in hand and just as my generation was the transitional one formulated on selfishness so were the young people of the 60’s and those of the 20’s.
It is now that a change will occur and will be actively encouraged by world powers. My children’s generation will be moulded into traditional prudent spending. This will be achieved by starving them of credit so they will have to live within their means. This is how the cycle will be reversed.
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