The baby boomers and the price of personal freedom

The baby boomers. Born between 1945 and 1955, they are busy ignoring the biblical calculus that a man's span is three score years and 10. Having enjoyed a life of free love, free school meals, free universities, defined benefit pensions, mainly full employment and a 40-year-long housing boom, they are bequeathing their children sky-high house prices, debts and shrivelled pensions. A 60-year-old in 2010 is a very privileged and lucky human being – an object of resentment as much as admiration.

I'm at the heart of all of it – guilty as charged. Born 21 May 1950, I'm the quintessential baby boomer. And for the last three months, while most of the rest of the world has been getting on with their lives, I've been wrestling with the implications of my new seniority. Sixty may or may not be the new 50, but it is a significant milestone; I've been on the planet for an awfully long time. What sense can I make of the decades I have lived through? To what extent am I and my generation unfairly lucky? What is the best way to live my life from now on?

To a degree I have some sympathy with the resentment, marshalled in a cluster of recent anti-boomer books. Individually, we may not have been the authors of today's flux, uncertainty and lack of social and cultural anchors, but we were at the scene of the crime. The cultural, economic and institutional cornerstones of British life have been shattered – and the way our love of fun was channelled is undoubtedly part of the story. The upside is that some of the old stifling prohibitions and prejudices have gone, hopefully for ever. But the downside is that we have become authors of our own lives without society offering us a compass to follow.

What, for example, should men and women expect of each other as they make the lifelong commitment to marriage? Have families become too child-centred to the detriment of our kids – mollycoddling and overprotecting them? Social landmarks such as our health service, education and police systems are the objects of near-permanent revolution, fired once again by the coalition government in the name of "radical reform" – as if radical reform is so important that it is worth the accompanying cost and disorientation.

Thus the paradox: more freedom but more angst and uncertainty.

There is no longer any discrimination in our embrace of cultural liberalism; it stretches into every nook and cranny of our lives – from the financial markets to sex – and sometimes with consequences none of us like. It was Howard Davies, when he ran the Financial Services Authority, who compared financiers to consenting adults; the inference was that he had no more business inquiring into their private business affairs than he would into what went on in their bedrooms. His liberalism has been proved wrong. The story of the past six decades is in many ways the story of how we threw off our shackles only to discover that we do need some constraints, even in the City. And in the bedroom? Our extreme liberal stance has seen us deluged under a tidal wave of pornography. The debate in the years ahead will not be about how to continue with our baby boomer liberalism, but over how and where we need restraint around some shared principles and rules.

So, the 1950s. My mother likes to say that these were the last years of the old order. They might have begun with the Korean war and ended with African decolonisation, but life in suburban Britain was not just stable and predictable, it was governed by enduring institutions whose friendly grip on our lives seemed unbreakable. Church meant something – as did Empire Day. My grandfather sang the national anthem lustily after the Queen's Christmas Day message, and insisted as a tenant farmer he was a true English yeoman. I could tell the days of the week by my mother's almost religious cooking rota – stew on Monday and liver on Thursday.

Companies had been around for decades and would be as much part of our future fabric as they had been of the past. Persil washed whitest. The pound was worth two dollars and 80 cents and 35 dollars bought an ounce of gold. The US ran the world with Britain as its chief lieutenant. Everybody would marry and have 2.2 children. It was a time of mottos: better be safe than sorry; carry an umbrella to work in case it rains. What I had to do was work hard and I would find myself on the conveyor belt that would convey me upwards. Chief executives of companies earned the same salaries as the permanent secretaries running Whitehall.

That world has gone. The anchors have dissolved or are dissolving. There is neither a monetary nor religious anchor. The pound floats; Catholicism is mired in the horrifying sexual antics of its priests; CEOs pay themselves salaries without limits. The great visions of how one might associate with others – in an Empire, a Commonwealth, a socialist economy, a commune, a religious community, a trade union or even a company – have become implausible. We are individualists in a not very sovereign nation state being buffeted around by economic forces beyond our control. We madly find meaning in cults and celebrity, overinvesting in family as the last redoubt of meaning, while reconciling ourselves to fewer public services and cynical companies even while the country is very much richer.

Our liberalism is not only extended to bankers; it extends to families whose members have no serious plan ever to return to work. The withdrawal of benefit may be so savage that they face a de facto marginal tax rate of 80 or 90%, but the fact remains that the consequence of government action is that they will live for ever on benefit. Until now this could never be queried because nobody wanted the sobriquet of being callous towards the disadvantaged. We have lost our capacity to think straight. We pulled down one culture with its rules and imagined that another would spontaneously take its place.

How could we have been so destructive?

One reason is that the Britain of the late 50s and early 60s was a model for nothing you would want to fight for. At home, we watched the Black and White Minstrels together as a family without a trace of embarrassment – and then my father would roar out the lyrics as we did the washing-up together. It was suffocatingly dull. It needed to change. Our parents, 15 years on from a world war, loved the order, routine and dullness. Their children could not abide it. When Paul McCartney and John Lennon sang "She's Leaving Home" about a daughter who slips out of home when her parents are asleep, leaving a farewell note – that she hoped would say more – to meet a man from the motor trade, the wonderful choruses spoke to all of us.

"She (We gave her most of our lives)
is leaving (Sacrificed most of our lives)
home (We gave her everything money could buy)
She's leaving home after living alone for so many years (Bye, bye)."

And signing off

"She (What did we do that was wrong?)
is having (We didn't know it was wrong)
fun (Fun is the one thing that money can't buy)
Something inside that was always denied for so many years (Bye, bye)
She's leaving home (Bye, bye)."

We all knew there had to be more than our parents' worthy but unexciting lives, and we knew it simultaneously across the west. There was a great rising of a new collective consciousness. We wanted to declare our independence, and create something new that was more urgent, more noble and more sensuously alive. Wearing your hair long or your skirts short was a way of signalling that you understood and belonged. Each university summer vacation I accepted my parents' furious reaction to my not very long hair, and trimmed it just a little. I knew exactly what David Crosby meant when he sang with Stills, Nash and Young that he almost cut his hair the other day… but he hadn't because he wanted to let "my freak flag fly".

The more freakish you looked, the more you signalled to yourself and others that you had got it.

The Labour movement that had created the postwar welfare state through a collective force of will, along with universal health and education, and whose power kept capitalism honest, was infected and finally overwhelmed by the new culture. Socialism no longer meant building great national institutions that enfranchised the mass of citizens, or acting as a crucial countervailing power to capital; it meant fighting for individually rewarding wage settlements and becoming part of the romantic movement for the "revolution". The shop steward movement of the 1960s and its wildcat strikes were inextricably linked to hippies, smoking dope, the anti-Vietnam war movement and the rapidly growing women's movement.

And paradoxically the same liberal culture fed the desire to dismantle the regulation of banks and the constraints of the postwar fixed exchange rate system. Everyone wanted to escape the dull routines of suburban life and managed capitalism. Nobody wanted to be a corporation man. We wanted to be on the move – hence all those spontaneous "movements" that came together in the heady days of 1968. I joined the occupation of the Senate House of Bristol University to object against exams as unfair instruments of social control and bias. I wasn't entirely sure whether the continuous assessment proposed as an alternative was the gain in the class war that the student leaders insisted upon or worth a night on a hard floor, and soon left the occupation to others. But the occupation was where the social action was. To protest and agitate were hard-wired into the DNA of the times. As Mick Jagger – always a closet Tory according to those close to him – sang, "You went down to the demonstration". He knew the score.

Timothy Leary told a generation to turn on, tune in and drop out. Few had the courage to go all the way in psychedelic trips – but you had to be very odd not to be ready to dabble in drugs. They were a political and personal statement. They underscored the new movements and especially the music. Some of what was written in the late 60s and the early 70s hit sublime heights – Van Morrison's Astral Weeks, the Stones' Exile on Main Street, the Beatles' self-titled "White Album" – and the succession of stunning bands and artists dazzled us. Roxy Music, David Bowie, the Grateful Dead, the Beach Boys, the Band, Crosby, Stills, Nash & Young, Pink Floyd, Led Zeppelin, the Who… One of my daughters conserves all my vinyl from the time, and has even bought a faux-period record player on which to play them. The opening chords of some of the great rock anthems still send shivers down my spine. I was at Olympia, the Roundhouse, Hammersmith Odeon and the Rainbow to see them live. Yes, I was lucky.

Some of it you couldn't be part of. You needed to be American to be genuinely anti-Vietnam. And you needed to be a woman to reject the sexual stereotyping, to fight for genuine gender equality and to try to forge new ways of being female. Men understood the spirit that moved the women, and even those who exploited it by taking promiscuity to Promethean heights knew a man at the very least had to give pleasure as well as take it. The sexual deal and gender bargain were changing. Women would no more meekly hold the fort in the suburban home while their corporate husbands commuted to the office. They, too, wanted to be part of the swim, part of the movement, part of the change.

Some called it feminism; I think women's liberation caught the mood better. The trouble was that men had to change, too, as a product of female liberation – a much slower and more hesitant process. But when I think of how my grandfather's generation thought of their wives and daughters and how my son's generation does, there has been a startling change. There is still misogyny, but nothing like the ghastliness of the 1950s.

The 70s was the crisis decade – when the social impact of the 1960s' movements and the disintegrating structures of managed capitalism fused into stagflation and outright social conflict. The National Union of Mineworkers were the self-appointed shock troops of what we still called the working class, battling for fair, working-class wages and the acceptance that their jobs were their property, not to be touched or compromised by economic forces or new technologies. This, apparently, was socialism. The 1960s' romantics felt obliged to make common cause, or at least not undermine them. It would take Mrs Thatcher to win the year-long miners' strike between 1984 and 1985 — the culmination of a 15-year-long confrontation.

It was an inevitable victory, but it meant that the movements of the 1960s no longer had a political champion for industrial and economic change from below. The liberalism of the great social movements would transmute into economic liberalism – and when Labour lost the 1992 general election the rout was complete. Capitalism had lost every check and balance. There was no Labour movement and no idea of socialism. There was no political party committed to reforming capitalism. There was not even the cultural acceptance of restraint, the need for rules and proportion.

Looking back you can see how 1968 led to the futile confusion of the 1970s, the certainties of Thatcherism and the great mindless credit-induced boom of the 1990s and 2000s – credit rolling out of the great deregulated banks and building societies. There were no financial anchors. The left was impaled on the horns of an impossible cultural dilemma. Naturally it sided with hippies and rock'n'roll and a cultural milieu that kicked against rules. But what legitimacy did that offer to use the state to remake the economy and society? In any case an unholy alliance of liberal romantics and hard-left unionists thought the task was not to manage, regulate and order capitalism – it was to transform it. I was working in the City in the mid-1970s, and could scarcely believe British trade unionists protesting against the Bullock Committee's proposals to create a statutory obligation for trade unions to be represented on company boards. Couldn't they see that the City believed the proposal the work of the devil? But the City could relax. Trade unions thought to sit on boards would represent collaboration, castrate them in their fight against capitalism and undermine free collective bargaining. Their resistance was an act of supreme folly that would contribute to the decline and fall of meaningful trade unionism while the stock market jumped in delight at their mulish opposition – but it is rare even today to find a leading trade unionist who will recognise the craziness of that decision.

The Labour party could only split under the strain. Thus the Limehouse Declaration of the Gang of Four – Roy Jenkins, Shirley Williams, Bill Rodgers and David Owen – and the creation of the SDP in 1981. The aim was to represent the social democratic left but without being caught in the crossfire between class-war warriors and the romantic, idealistic left. The party would manage capitalism, update the postwar social contract and be a purposeful advocate for the EU. Its support soared.

But nobody had calculated that Argentina's General Galtieri would launch an invasion of the Falklands. Suddenly baby boomer concerns about how to live well and what to do about capitalism became subsumed into something more visceral. British territory had been violated by a military dictator, and British citizens placed under foreign military occupation. There could only be one response. The country would unite behind a task force and repossess what was ours in the name of democracy. I had just begun working on Newsnight and our audience soared. When Port Stanley fell, Mrs Thatcher's election victory was sealed – and so would be the liberalisation of the British economy. Privatisation and the curbing of the union movement had grown seamlessly out of our revolts of the 1960s – even using our language of freedom.

But the rout of British-style socialism was being matched elsewhere with even more force. For the first 40 years of my life the Soviet Union seemed a constant; suddenly on Christmas Eve 1991 it was wound up. Deng Xiaoping would say six weeks later in China that international communism could no longer claim it represented the destiny of history – two and half years earlier he had been the prime mover of the brutal suppression of the student and worker revolts in Beijing's Tiananmen Square and 180 other Chinese cities. The task now, he declared, was for China to build a socialist market economy and to offer the Chinese material wellbeing under the benign direction of the Communist party.

The students from Beijing University who began the protests were enthused with the same cultural longing for rock'n'roll freedoms as we were in 1968. Yet they would find the regime, like those in the west, would offer them cultural freedoms only as long as the rulers remained in firm political control. The Chinese, perversely, had arrived at the same unstable bargain as the west. You could dress as you like, make love outside marriage and shop until you dropped. But what you could not do is challenge the political order – to imagine a new way in which human beings might associate and organise themselves.

Thus when New Labour won in 1997 it won as a defeated intellectual and political force. It was not in the business of building a secular Jerusalem. It was in the business of being a caretaker of the established economic order while trying to promote the interests of the many, not the few, within budget constraints. The baby boomers, now home owners and possessors of defined benefit pension schemes, suddenly became wealthy as house prices trebled. The earlier fights seemed almost quaint. The deal was that capitalism had won; bankers and directors made fortunes; but the rest of the world got wealthier in their wake – and nobody asked questions about sexual orientation or ethnicity any more. A politician like Peter Mandelson could declare he was homosexual without damaging his career. What we had achieved, it seemed, was much more tolerance and much more wealth – with a disproportionate amount accruing to baby boomers. Collective provision and how we associate as members of society were yesterday's preoccupations. Even David Cameron's big idea – the "big society" – is not aimed at the mass of the British but the excluded minorities.

But when you trace the arc of the past 60 years, I am not so sure that where we have reached is especially stable. If the launch of the SDP marked the beginning of an era in British politics, the coalition government defines the end. The SDP and Lib Dem politicians who wanted to reinvent the left have ended up reinventing the right. Yet the big question of our time, after the financial crisis and the prospect of years of low growth and high unemployment, remains what it was in 1968. Capitalism cannot continue as it has at home and abroad. There needs to be a countervailing force to hold it to account and keep it honest. CEOs cannot enrich themselves for ever, without limit, with no wider economic and social consequences. If today's market economies cannot create jobs and prosperity for the mass of the working population, the restiveness will grow.

We baby boomers have had it lucky, certainly, but the hard questions we asked still remain. We have been bought off with rising equity in our homes and liberties we once could only dream of. But we wanted a different economic and social order – to live with each other in mutual respect and to be governed by those genuinely responsive to our needs and hopes. My hunch is that a new era is beginning with new movements that will ask more searching and fundamental questions again, taking up where my generation left off. Nor are we baby boomers quite done yet: I'm planning on hanging on in there for a little while more. We still have to deliver on those promises we made ourselves. Maybe those younger, but with similar ideals, can learn from our mistakes – and together we can really build something new.