Waging war on the young

In Cyprus it’s not explicit, but government policies together with those of anti-social banks have exacerbated the profound systemic challenges facing youthThe phrase “war on the young” is a prominent concept popularised by professor Scott Galloway of New York University, outlining how modern economic, political and social systems profoundly disadvantage younger generations compared with older cohorts. Indeed, backed by statistical evidence, Galloway argues that “what the US is doing to the economic future of its youth is nothing less than a war on the young”. Furthermore, he states that “We’ve broken the social contract that binds America: Work hard, play by the rules, and you’ll be better off than your parents were.” As shown below, Galloway, provides impressive evidence for the United States revealing that today’s 25-year-olds make much less real income than their parents and grandparents did at the same age, yet are burdened with much heavier debt loads than earlier generations. In fact, increases in minimum and median wages have lagged behind inflation, with rising housing costs markedly outpacing incomes of young persons. United States: Each generation at age 25 Average real income House price to income Grandparents $74,000 3X Parents $70,000 4X Children $56,000 7X How have government policies in the US disadvantaged younger persons in favour of older persons? While US public policy does not explicitly mandate harmful intent toward younger generations, critics contend that statutory frameworks, entitlement structures and labour laws, create systemic advantages for older citizens at the expense of the young. Indeed, federal anti-discrimination acts explicitly protect older employees from workplace discrimination, while offering little protection for youth. And the Fair Labor Standards Act enables employers to pay youth sub-minimum wages (as low as $4.25 per hour) during their first 90 days of employment. In addition, the structure of federal social benefits favours the elderly over youth, with government spending per capita on senior citizens far exceeding per capita spending dedicated to children and education. Besides, elderly persons have the initial wealth to amass greater wealth through investments in shares and real estate in boom times, whereas the young with their reliance on meagre wage earnings and limited access to affordable loans find it difficult to gain wealth, including getting on the property ladder. Most strikingly in the United States, real median income of labour is up by 40 per cent since 1974, while the S&P stock exchange index has risen by over 4,000 per cent. Cyprus Limited statistical evidence and a review of government policies since the Turkish Invasion of 1974 indicate there has not been explicit public policy discriminating against the young compared with treatment of older generations to be regarded as a “war on the young” in Cyprus. Statistical data reveal that from 1976 until the global recession of 2008 younger generations increasingly prospered in Cyprus with average real wage earnings rising in all years, indicating that children were probably doing better than their parents, at least in earning higher incomes. And with steady increases in house prices from 1976 to the early 2000s and good access to affordable loans, most young people could pay for decent accommodation and raise families. But the global recession of 2008 had a negative impact on the real economy, in particular causing tourist arrivals to decline sharply and construction activity to fall. And, subsequently, with Cyprus banks pursuing reckless lending policies and the government carrying out imprudent fiscal policies a fully-blown financial crisis occurred culminating in a severe “haircut” on bank depositors in March 2013. In consequence, average real wages fell by 5 per cent from 2009 to 2014 and the unemployment rate of rose from 5.4 per cent to 16.1 per cent between these years. While wealthy older persons were hurt more by the deposit haircut, it was the young that have suffered the most from the downturn in the real economy. In fact, reflecting the youth unemployment rate, that rose spectacularly from 8.5 per cent in 2008 to a peak of 37.5 per cent in early 2014, young persons, especially recent university graduates, couldn’t find decent jobs, and entry-level salaries and benefits for those fortunate enough to do so were reduced substantially to low levels. In sum, with rising unemployment and underemployment a situation was reached where young persons were earning less income than their parents at the same age. However, it is concerning that despite the ample financial and real resources of Cyprus, including its large number of skilled and qualified young persons, government policies since the economy began recovering from 2015 onward have fallen far short in addressing the problems and needs of youth. Rather the government with its spending and tax policies has promoted an allocation of resources to grossly favour and expand the leading, low productivity construction/property development, retail including vehicles, and tourism sectors of the economy, that are primarily the domain of big business interests. These low productivity sectors provide relatively few well-paid jobs to qualified young persons that can fully utilise their skills and add to business productivity, but instead employ a rising and large number of lowly skilled foreign workers. In addition, gaining employment and promotions in the Cyprus public sector and in many family-owned enterprises is determined importantly by “who you know” and political alliances, rather than by “what you know”, thus, reducing the chances of many qualified and unconnected persons in securing decent jobs. And the increasingly regressive tax system of Cyprus burdens disproportionately lowly paid young persons, while the very light taxing of property wealth and capital gains and not levying an inheritance tax definitely benefits the much older wealthier generation and limits the upward mobility of young people lacking wealthy parents. Besides, the Cyprus government’s tax policies and tolerance of irregularities favour the building of luxury apartments and houses catering for wealthier older persons, including many foreign buyers, as against the very deficient construction of affordable social housing for the younger generation. Notably, Cyprus youth with their relatively low incomes in the face of surging house prices over recent years are being priced out of the two-tier housing market. In fact, it is estimated that from 2018 to the first quarter of 2026 the median gross incomes of young persons rose by less than 30 per cent as against the increase of over 50 per cent in the “House Price Index” published by CyStat. Furthermore, with Cyprus banks extending loans largely on the basis of security provided by real estate, it is the wealthy that have easier access to bank credit to finance property purchases, rather than the many young persons that don’t have the means or wealth to secure a loan to finance decent housing. The bottom line is that, although the Cyprus government has not explicitly declared war on the young, its policies together with those of anti-social banks have exacerbated the profound systemic challenges facing youth, including lack of decent, well-paying jobs, high living costs, and shortages of affordable housing. And moreover, it is the politically connected persons in Cyprus rather than the apolitical, qualified, hard-working younger people, that benefit immeasurably from gaining attractive jobs and positions as well as being able to evade (sometimes corruptly) regulations and laws to their financial advantage.