You know the Bank of Mum and Dad when you see it: it’s your friend who seems broke, but always has a safety net, or who suddenly (but discreetly) acquires the deposit for a home. It’s those who stayed with their parents while they saved for a flat, or stuck it out in a profession they were passionate about even though the wages are chronically low. It’s those who do not need to consider the financial costs of having children. It’s those whose grandparents are covering nursery or university fees, with the Bank of Grandma and Grandad already driving an economic wedge between different cohorts in generations Alpha (born between 2010 and 2024) and Z (born in the late 1990s and early 2000s).
This is the picture we know, but the Bank of Mum and Dad is not just a luxury confined to the 1% – it is also evident in families like mine. I grew up in a working-class household and was the first person in my family to get a degree, but it was the fact my parents had scrimped in the 1980s to purchase properties in London (and allowed me to crash in one throughout my 20s) that has arguably been the true source of opportunities in my life.
In recent years, we have rightly widened the conversation about privilege in society. And yet how honest are we about one of the most obvious forces shaping anyone under 45: the presence or absence of a parental safety net? The truth is that we live in an inheritocracy. If you’ve grown up in the 21st century, your opportunities are increasingly determined by your access to the Bank of Mum and Dad, rather than by what you earn or learn. The economic roots of this story go back to the 1980s, but it accelerated after the 2008 financial crisis, as private wealth soared and wage growth stalled. In the 2020s, rather than a meritocracy – where hard work pays off – we have evolved into an inheritocracy, based on family wealth.
People should always have access to essentials, and I count an affordable reliable roof over their head as one of those things. But are we ever going to be able to change the fact that someone on the receiving end of three generations of doing moderately well in life is going to be massively more advantaged that someone whose parents were 4th and 5th in large poor families?
Someone's parents having even a modest home with a spare room in London puts them at a massive advantage over their peers who have to privately rent. But aside from ensuring the fundamentals are in place of affordable accessible homes, is there really any realistic way of nullifying that advantage and is it even right to do so?
Why shouldn't everyone have access to housing, food, education, tutoring, and transportation like those people who inherit from their parents?
The social impact of engaged parents can't be missed, but there's no reason why there should be a material aspect.
Because, fundamentally, most people work because it makes their life better than if they weren't working.
It we so heavily correct the system so that you get the same house whether your working or not, your kid goes to the same school whether your working or not, they get the same homework tutors whether your working or not, you have access to the same transport or car whether you work or not.. you get the point.
How many people would even turn up to work if it made no material difference to their life?
But as soon as you allow people's effort and choice to create an actual difference in the quality of their and their kids lives then you inevitably end up with inequality, because people make different choices, are motivated to work hard to different degrees. This gets compounded when some families simply build on the moderate success of the parents.
Rather, isn't the better option to just make sure that the "bottom" option is not inhumane and is actually basically alright. In fact, it should be as good as we can possibly make it. BUT then you have to allow that choice, hard work, sacrifice can possibly make a difference and people can improve their lot.
None of that is relevant to the idea of affordable housing for college students because 18 year olds going to college haven't had the chance to start working yet.
I don't think I was particularly lazy as a student just because I got free college and $1k a month student loans from the Swedish welfare state, and a free apartment from my parents, all without working a single hour for pay.
I remember some of my strongest drivers in college were my social life, the opportunity to enter an exchange program, passing 75% of my classes to keep my student loans, and my personal interest in the things I studied. So some monetary/quasi-monetary, but also many social. And none of them based on wage labor.
Also, while social democracy like what I've described doesn't reject your ideology, there are also people who work for other reasons besides money, and there are more forms of unpaid work than there are for paid work.
But social democracy is exactly what I'm describing
https://en.m.wikipedia.org/wiki/Social_market_economy
https://en.m.wikipedia.org/wiki/Third_Way
So we are both describing social democracy
Coming at the same thing from opposite sides as it were. The political movements I linked to have enjoyed at times broad support in Germany and the UK and elsewhere in Europe. They consciously reject 'hard' socialism as (regrettably) unworkable. They deliberately seek well functioning safety nets for the vulnerable and less able but see a well regulated 'fair" capitalism as being essential to unlocking people's creativity and initiative. And that means allowing people to better themselves through their efforts. Equal opportunity not equal outcomes (but safety nets to prevent excess).