What Happened Today: May 6, 2022
TikTok’s Gen Z debt bubble; Millennials living at home; Miami Grand Prix
The Big Story
The increasingly popular pay-later loans that Americans used for $20 billion in purchases in 2021, and which accounted for 91% of all California consumer loans in 2020, are now driving Gen Zers into dangerous levels of debt. According to a new SFGATE investigation, the short-term financing offered by a bevy of companies, including Afterpay, Affirm, and Zip—which allow someone to pay a small down payment up front with the remaining balance paid out over four installments—has caught fire with consumers ages 10 to 24, who are now spending 925% more with point of sale loans compared to two years prior. For the popular Afterpay service, 7 of every 10 Gen Z customers used the short-term financing on fashion, paying the small up-front fee on both high-end luxury and mid-level consumer brands to keep up with the frenetically changing trends and fast-fashion cycles that dominate TikTok. With little to no required credit checks, and falling outside the purview of the federal credit card laws that only kick in on loans with five or more payments, the in-app one-click temptation has driven young consumers to spend significantly more than average internet buyers—and, for some, well above their means. One survey found that 43% of Gen Z customers missed at least one of the four payments.
In December, the U.S. Consumer Finance Protection Bureau began an investigation into several pay-later companies, and California has fined two services for skirting loan rules, but the industry remains largely unregulated, and young customers are seeing their credit ratings plummet as they fail to cover the late fees and ballooning interest before their accounts are sent to collection. “There’s a lot of concern that consumers could be amassing large amounts of debt at a very quick pace without having a clear understanding of what the terms are,” said Marisabel Torres, an executive of the Center for Responsible Lending. Walmart, Amazon, and Target now use various pay-later vendors, and with inflation on the rise, consumers are flocking to pay-later offerings to cover expenses on everything from gas to groceries.
Read it here: https://www.sfgate.com/news/article/influencers-lead-Gen-Z-into-debt-17142294.php
In The Back Pages: Your Weekend Reads
The Rest
→ Speaking of Gen Z’s favorite social media app: A new Forbes investigation of hundreds of TikTok livestream videos found rampant use of TikTok’s in-app virtual gifts—flowers, lollipops, and ice cream cones that can be converted into cash—as tips from livestream viewers who request young girls to perform various acts that cross the line into child pornography. Rather than make overt requests on livestream video feeds for female performers (one claimed to be as young as 14 years old in a Saturday-night stream to 2,000 viewers reviewed by Forbes), the viewers use phrases like “pedicure check” or “touch the ceiling,” code for moving the camera to a girl’s feet or other body parts. With Congress still stalling on any progress to update decades-old internet privacy laws that protect children, the livestream marketplace has created “the digital equivalent of going down the street to a strip club filled with 15-year-olds,” said Leah Plunkett, a Harvard Law School professor with a focus on internet culture. TikTok has said it aggressively stamps out pornographic material or any accounts that violate child sexual abuse laws, but with a billion worldwide users and more than $2 billion spent within the app in 2021, the massive platform is difficult to police adequately. This year, the Department of Homeland Security and a group of state attorneys general have launched probes into underage abuse on the platform.
→ Prideful New Jersey natives will get defensive about nearly anything, but even the most ardent Garden State champions will tell you that Asbury Park has no claim on a list of the United States’ 25 best beaches. (It wouldn’t even crack the best five beaches in New Jersey.) What’s going on in this top beach list from Travel + Leisure is trickle-down politicalization, where the toxic slime of our culture wars slides down into even the most banal content marketing of lifestyle vacation magazines. In this case, T+L is trying to ding the red-leaning Florida and is gaslighting its readers in the process, with claims that the Sunshine State’s shores don’t stack up to the top-flight sandy destinations of New London, Connecticut, and Oak Street Beach in Chicago.
→ Some companies and long-standing institutions are waking up to the reality that inflecting their entire identity with advocacy on hot-button issues might not be working out so well—or at least that’s what Zeno, the public relations firm with $110 million in annual revenue, is telling some of its biggest clients about the recent Roe V. Wade leak, including Starbucks, Coca-Cola, and Philips. In a memo sent to clients from a Zeno media strategy executive, which was obtained by Substack “Popular Information,” the message is simple: Stay silent about the Supreme Court opinion, even if you’ve previously been a champion for gender equality. On social media, to inquiries from the press, or in their own communications, Zeno advised clients to “not take a stance you cannot reverse, especially when the decision is not final,” it wrote. Despite advocating its commitment to “speaking up in the face of inequality” as recently as March of last year, Zeno explained that the constitutional support for abortion rights is a “50/50 issue,” and thus companies should not risk “assum[ing] that all of your employees, customers, or investors share your view.” Sounds like some pretty good advice.
Read more: at Popular Information
→ Vaccines were “consistently associated” with a rise in the number of young men hospitalized with heart issues, according to a recently published study by researchers from MIT, which looked into the relationship between COVID-19 vaccines and myocarditis, or heart inflammation, among men ages 16 to 39. Raising “concerns regarding vaccine-induced undetected severe cardiovascular side effects,” the peer-reviewed study from Nature journal Scientific Reports argued that the data, derived from Israeli medical records, “underscore[s] the already established causal relationship between vaccines and myocarditis, a frequent cause of unexpected cardiac arrest in young individuals.” Examining the number of myocarditis-related emergency room visits made by young men during the period of the vaccine rollout (January 2021 to May 2021), and comparing this number to the previous year, before COVID-19 had arrived in Israel, the MIT researchers noted a 25% increase coinciding with the introduction of the vaccine in Israel. The study, meanwhile, found no relationship between myocarditis and being infected by the novel coronavirus.
→ As the chart below makes clear, more young adults are living at home with their parents than at any time since World War II. One could be forgiven for assuming that this is the result of the COVID-19 pandemic, which complicated young Americans’ efforts to leave home. The rising rate of young people still living with their parents, however, began in the early 2000s, with the percentage of Americans aged 18 to 34 living with their folks rising roughly 10% from 2000 to 2020. The long-term trend that best explains this phenomenon is the rising cost of housing across the United States. The millennials who do manage to buy homes, meanwhile, often do so with a bit of help: According to a recent Apartment List study, 21% of millennials are getting money from their parents for their down payment, helping them finally leave home. Most millennials, though, won’t be packing up their childhood bedrooms anytime soon: The study found that two-thirds of millennials have no savings for a down payment.
→ Volkswagen has announced that it has “sold out” of all of its electric cars for the year, citing supply chain issues that have made it impossible for the company to produce more vehicles. After Tesla, Volkswagen is the world’s second-largest electric car manufacturer in the world; the company, which includes brands like Porsche and Audi, sold almost 100,000 electric vehicles before March, at which point pandemic-related factory closures in China and Russia’s invasion of Ukraine hindered VW’s ability to import semiconductors and crucial wiring components. Tesla, meanwhile, has continued producing its cars apace: From January to March, the company made seven times more electric cars than VW did. Tesla’s ability to maintain its steady rate of production is owed, in no small part, to its “closed-loop” production systems in its Chinese factories. As The Scroll has previously reported, while most factories in Shanghai have been forced to shut down operations because of the country’s Zero-Covid policies, some have been able to remain open by requiring workers to remain in the factory 24/7. Tesla adopted this model, giving workers space to eat and sleep on the factory floor.
→ Just as the airline industry begins to recover, with the number of American air passengers finally nearing pre-pandemic levels, airlines are struggling to deal with a shortage of pilots, thanks in no small part to those who’ve taken early retirement during the pandemic and the 5,000 more pilots set to retire over the next decade. In response to these staffing issues, airlines are planning on making some unusual travel arrangements for their passengers, including shorter connecting flights with passengers ferried between airports on buses.
→ Airlines have increased pilot salaries 30% in the past five years to try to attract more to the field (the current salary is $200,000), which leaves pilots as the second-highest paid workers nationwide, just after doctors. Federal firefighters, on the other hand, are being paid wages so low they can’t afford their own housing—with some salaries starting at $13.75 an hour—and firehouses are suffering from severe staffing shortages, crumbling buildings, and shoddy equipment. “Fundamentally, people don’t want to take jobs because they can’t find a place to stay,” said Kelly Martin, president of Grassroots Wildland Firefighters. With the western United States suffering from dire drought conditions, federal firefighters will be the first responders for what is predicted to be a harrowing summer—but many have already left the industry, with some northern California firefighting outfits currently staffed 50% below their usual workforce.
→ South Florida’s Hard Rock Stadium (home to the Miami Dolphins) has been transformed into the world’s biggest motorsports league, as 20 Formula One cars compete for the first time at the Miami Grand Prix this Sunday, a massively hyped sports spectacle event organizers hope to turn into a Super Bowl-level phenomenon. Riding a wave of new attention from the breakout Netflix Formula One drama series Drive to Survive, the Grand Prix will hope to draw more American fans as the Williams sisters, Pharrell Williams, Michael Jordan, LeBron James, and David Beckham all flock to the race, where tickets to several of the luxury dry-docked yachts floating in a man-made marina near the track fetch for $38,000.
Your Weekend Reads
→ Embracing his inner crank, New York Times columnist Jay Caspian Kang comes out in favor of the local scenes where distinct geography and communal spaces once generated idiosyncratic art, music, and regional writing. Moving online, writers and artists were no longer constrained to make the best of what’s physically around them, replacing “the community of the place where you live—with all its boredom and angst—with the community of what you like.” The result might be a song or essay that goes viral, but that doesn’t mean it's alive or even good.
For years when I was a teenager, my hometown, Chapel Hill, North Carolina, was supposed to become “the next Seattle.” Bands like Superchunk, Polvo, and the Archers of Loaf all played a venue called the Cat’s Cradle and evinced a sound that felt like it represented a type of slacker Southern intellectualism and counterculture that was rooted in everything from the local barbecue to the anarchist bookstore downtown. This slacker spirit is still in me; my identification with Chapel Hill is grounded in this music, which I didn’t even particularly like at the time but understood was part of where I was from.
Art is simply better when it comes out of these lived contexts. It matters, for example, that Mavis Staples, Lou Rawls and Sam Cooke all went to the same elementary school in the South Side of Chicago and that many of their classmates came from families who carried Southern musical traditions up north during the Great Migration. It also matters that they grew up in the shadow of Mahalia Jackson, who they could see perform in a nearby church.
When things are that specific and need little to no introduction, they feel alive and relevant in ways that transcend the local contexts in which they were created.
Read more: https://www.nytimes.com/2022/04/25/opinion/global-art-music.html
→ Major advocacy groups with armies of online activists behind them are making aggressive overtures to some of the biggest advertisers on Twitter in an effort to scuttle the looming Elon Musk takeover. With not-so-subtle suggestions as to what would happen to the corporations if they didn’t pressure Twitter to back out of the deal, and keep in place its existing content moderation system, the groups are lobbying some of the largest corporate brands to make sure Twitter doesn’t become “a direct threat to public safety.” As Tablet senior writer Armin Rosen put it in a new piece today, “The pitch was a simple one: Nice store you got there. It would be a shame if someone threw a rock through your window.”
Musk Tweeted about the effort, asking, “Who funds these organizations that want to control your access to information?” But Rosen expands the inquiry wider. “Better to ask: What function do these ‘advocacy groups’ serve? And for whom?”
They all receive funding from liberal foundations that donate widely to Democrats, or from advocacy organizations, like labor unions, that are deeply involved in Democratic Party politics. All three are creatures of the broader Democratic Party apparatus. They are the party’s attack arm.
There is nothing automatically wrong with the public-private vertical representing one side of the American political duopoly deciding to treat the takeover of a web platform popular with journalists and other people with master’s degrees as if it’s a high-stakes special election in a purple congressional district. But the letter, and the work of its three main sponsors, still reveals the application of political campaign-type tactics, organization, and rhetoric to an ever-expanding and potentially unlimited variety of contexts. Welcome to the world of fully automated political warfare, about everything, all the time.
Armin Rosen hits the mail on the head in showing how the left wants to politicize everything on a 24/7 basis
The campaign against Musk and his buyout of Twitter is clearly a campaign by the woke left to suppress dissenting views-just look at the make up of the 501(a) (4).