Tag Archives: Finance

There’s a Bad Moon Rising

Posted by on January 28, 2008 No comments

As I mentioned last week, the US economy seems to be headed for the crapper, and it is very possible that much of the developed world will be dragged down with it. Many of you may be too young to have seen it before, but this sort of thing happens every now and then.

You may not be affected much; there are some people who do well even in very bad times. (The people who had jobs during the Great Depression were quite comfortable. There were very, very many people, though, who did not have jobs, and it was brutally hard for them, for many years. And when I say brutally hard, I mean like dumpster-diving behind department stores to scrounge discarded wrapping paper to use as toilet paper. Think of that when your life seems tough.) If your job is secure and your company is solid, or you are already wealthy, maybe you have nothing to worry about.

If the economy does get as bad as nearly every economist thinks it may, though, you could be in for some hard times. Probably not Great Depression bad, but bad enough. If you are already established in your career (and spending habits), you may suddenly find yourself struggling to maintain your lifestyle. If you are a college student about to graduate, you may find yourself stumbling right out of the gate, unable to find the sort of job you would like. As a student, you have an advantage over the thirty-something who was just laid off in that you’re used to not having any money. On the other hand, you’ve got all those student loans to pay back, and you were probably unwise enough to accumulate some credit card debt too. Good luck.

It has been a while for me, but all of my childhood and much of my adult life were spent in…financially adverse conditions. I don’t like it, but I’ve done it before and I can survive it again. Even better (for you, you lucky devil you), I can pass along some advice that may be helpful to you after your boss stops by your cube to drop an ominous, “Could you come into my office for a minute?” There’s nothing earth-shaking here, and any truly poor people reading this are probably going to be thinking, “Damn, these well-off people sure do whine a lot,” but I’ve seen first-hand how poorly many people respond when faced with a downturn in their financial status. Maybe this will help.

The important thing is to adjust your expenses to fit your new income. That may seem like common sense, but it is exactly what most people don’t do. If you take nothing else away, remember that. Everything else is details.

(You may not have much choice anyway; banks are tightening up and credit isn’t going to be as easy to come by as it used to be. Even if you (foolishly) want to keep spending and racking up debt, you may not be able to.)

If you were foresighted enough to have saved up an emergency fund, this is where it pays off. You’ll still want to manage your expenses carefully, to get the most out of it, but you don’t have to worry as much about losing your house or car, or putting food on the table, as someone who doesn’t have one. Congratulations. Just remember that you should only dip into the emergency fund to pay for essential expenses. If you use it to pay the cable bill or buy a new TV, you may find yourself unable to pay your mortgage down the road.

Preventative Maintenance

It wouldn’t hurt to periodically evaluate your finances even if you’re not having any financial difficulties. Do it the next time you have an hour or so free. You may be surprised at how much you’re paying for some things, possibly things you aren’t even using anymore. Sometimes just making a few changes can save you some money without cutting back at all on what you’re getting in return. For example, I recently made some changes to my phone, TV, and Internet services which are going to save me about $110 a month, but get me overall better service. That’s $1300 a year, just for spending about half-an-hour on the phone. A couple years ago I shopped around my home and auto insurance and ended up getting better coverage while cutting my bill by several hundred dollars. Don’t assume that the great deal you got years ago is still a great deal today. Shop around.

If you can do it painlessly, why not save the money now? Someday, in the not very distant future, you just might be glad you did.

Triage

The first thing you want to do when you find yourself with a sharply reduced (or non-existant) income is to take a hard look at all your expenses. The essentials are food, utilities, housing, transportation, and possibly certain debt payments. I include phone and Internet service (both very important these days if you want to get another job) in with utilities. Everything else is secondary. Make a list if you have to. Write down everything you spend money on in a given month and organize it into two columns: Essential and Not Essential.

Now, look at the non-essential stuff and see where you can cut back. Do you have to eat out five times a week? Do you really need the top-of-the-line cable package, with all the hi-def movie channels? Try eating out just once a week, and basic cable. Hit the liquor store instead of the bar and buy your booze by the bottle instead of by the drink. Maybe you can live on one new pair of shoes a month instead of five. You get the idea; cut out or cut back on the things you can do without. Don’t cry too much if you have to say goodbye to HBO; with any luck you’ll be able to get it back again in a few months or a year and if you missed anything good you can catch it in repeats or on DVD.

Every dollar you save by cutting back in the non-essential expenses is another dollar that you can spend on the stuff you have to spend money on. HBO you can live without. (Yes you can. Really. Be strong.) Groceries, not so much.

If money is so tight that you’re not sure you can even pay all of your essential bills every month, buy food first. Your money will go farther if you can cook — frozen dinners are handy, but a lot more expensive than making your own meals — but whatever; buy the food first. Screw the mortgage company and the phone company; you have to eat. If you don’t even have enough money for that, give serious thought to calling your parents and seeing if your old room is still available….

After you’ve stocked the ‘fridge and pantry, pay your utility bills. You have to have electricity to live (quite literally in some cases; here in north Texas a number of people die every summer because they don’t have air-conditioning) and you’re going to have a hell of a time finding a new job without a phone. The water bill, if you have one, is no place to cut corners. You may be able to save a little here, by downgrading your phone and Internet service, for example, or being more careful about wasting electricity, but in general don’t mess with the utilities. Pay them if you have any money at all left after groceries.

Only after you’ve put food on the table and kept the lights and water on should you worry about paying the mortgage (or rent). Yes, you have to have a place to live, but the thing is, it takes a long time for the bank or landlord to throw you out of your home. It won’t make anyone happy, but you can run a month or two behind and still survive. Lack of food and water is much less tolerable.

If you have a car payment, you’ll have to use your judgement as to whether it should be prioritized above or below your housing. That will depend on how essential a vehicle is in your area and how quick you think the bank will be to repo it if you fall behind. I usually ranked the car payment as more important than the rent. Putting gas in the car and fixing it if it breaks is more important than making a payment. If you need a car it’s not going to do you any good just sitting in the driveway looking pretty.

Credit card and other debt payments are last of all the essential expenses. Bad things may happen if you don’t pay them, but you probably won’t be deprived of a place to live. (If you owe money to the certain people, of course, you may lose more than your home. Or certain other people may provide you with a place to live, but one you probably won’t like.) Try to make at least the minimum payment on your credit cards, and as you watch the balance pile up resolve to get rid of those credit card balances forever once the money starts flowing again.

There is some slight of hand you can do with credit card debt, like opening a new card and taking advantage of their low-interest balance transfer option, and I’ve had to resort to that in the past, but you can only do so much of that. That is another reason to carry as little debt as possible.

Ramen Again?

I could go into a lot of detail on specifics of where to save money on this or that, and maybe I will sometime, but the important thing is to think in terms of trying to save money. The wrong mindset is what will do you long-term harm. Studies have shown that most people, faced with a financial setback like losing their job, don’t change their spending habits. They keep right on as before, but either draw from savings or go (deeper) into debt to make up the shortfall. (Same thing, really; drawing money out of savings is just another kind of debt; you’re borrowing from yourself.) Maybe you’ll have to do that even if you do cut back on your expenses, but wouldn’t you like to minimize that debt?

You could think, “This isn’t going to last forever; I can afford to run up the credit cards and pay them off after I get a new job.” Or you could think, “This isn’t going to last forever; I can live without the HD cable sports package for a while.” Guess which one is going to leave you with an empty bank account, and maybe a foreclosure notice from your bank?

Who knows; maybe you’ll find you enjoy cooking your own meals, and you might find some good books to read. The best things in life may not be free, but they can be cheap.

Turbo Budgeting

Posted by on March 3, 2008 No comments

With all the emphasis I place on living comfortably within your means, it may come as a surprise that I don’t bother with a budget.

Yes, it’s true; the tight-fisted, penny watching Grumpy Pundit doesn’t use what is possibly the most often recommended means of managing your home finances. And you probably shouldn’t either.

Heresy!

Now, if this were the conventional sort of financial advise blog, I would jabber on for a bit here about how to set up a budget. I’d tell you to list your monthly expenses and total them up, and total up your monthly income, and carve away portions of the former until it fits within the latter. Most likely you would nod thoughtfully and make a mental note to do that, then go watch TV and forget about it. If you were feeling particularly dutiful, though, you might fire up your bootleg copy of Excel and fill in a few numbers, take your best guess at a few more, and decide that if you cut your drug habit back to $500 a week that’ll still leave you $50 a week for groceries and let you save up a little money for a spring break trip to the coast to get laughed at by girls who are much too young for you.

Or something like that.

At any rate, after reading my conventional advice and spending a bit of time fudging numbers in Excel (come on; do you really know how much you spend on groceries every month?) you might actually come up with a budget, determine that you can spend this and that much on these and those things and you might stick with it for a week or two and then you’ll forget about it. Right? Come on, be honest. You can’t even stop watching that crappy TV show that was funny last season, but sucks this season. Do you really think you’re going to change your spending habits just by whomping up a spreadsheet and deciding to?

(OK, sure, there are a few people who could do that. They aren’t surfing the web for financial advice.)

But this is the Grumpy Pundit Blog. We do things differently here. I’m going to tell you how to live within your means, and even save money, without wasting any time on a budget that you’re not going to pay any attention to anyway.

First rule. Pay your bills in full. That is, don’t carry a balance on your credit cards; pay them off every month.

Second rule. Pay yourself first.

Sounds pretty simple, doesn’t it? But simple does not mean easy and most people can’t manage it.

If you can follow the first rule, you are automatically living within your means. You are not spending any more than you are making. The adjustment you have to make here is not a budgetary one; it’s mental. You must fix the idea in your head that what you buy in a month must be paid for that month. Be as extravagant as you like, but remember that the credit card bill has to be paid off completely when it comes due. Do that and your spending is automatically limited by your income.

That may seem obvious, but it is a — perhaps the critical step to getting control of your finances. Pay your bills on time and in full. It’s a simple rule that is easy to get your head around and I find that simple rules like that are much easier to stick to than a complicated budget.

But what if your credit cards already have balances on them and you simply can’t pay them off each month? Simple; pay off all the new charges plus interest. Don’t let the balance grow. Cover what you spend each month out of that month’s income (or, if you have to, your emergency fund).

It may take you two or three months to adjust to that. Once you have, it’s time to go to Rule 2.

Pay yourself first. This reverses the way that most people save money. Rather than taking anything left over at the end of the month and putting into a savings account, decide how much you want to save each month and put that into savings before you pay your bills. If possible, set up an automatic transfer so you don’t even have to think about it. (If you are carrying a balance on your credit cards put the extra money towards paying that off instead.) By doing this you are adjusting your spending to fit your savings rather than adjusting your savings to fit your spending.

Let’s try an example to see how this works. Let’s say that you make $4000 a month and after you finish paying your mortgage, car payment, utilities, groceries, etc., (including that money that just seems to melt out of your wallet; the two or three hundred a month you never can quite account for) you have $1000 left of the month’s pay.

Then the credit card bills come in. You have outstanding balances of $3000, with $1200 in new charges.

Uh, oh. There isn’t enough to even pay all the new charges. You grit your teeth, remind yourself, “Pay in full,” dump that $1000 on the credit cards and resolve to cut back on your spending so you can do better next month.

Next month you’ve got $1100 left before the credit card bills (progress!). The credit card statements land with a thud on your dining room table and amount to $3250 in balances carried over plus $800 in new charges. Pour all $1100 into the credit cards, to start paying down that debt.

Fast forward several months. You’ve paid off the credit cards and gotten your average credit card bill down to about $700 a month. You figure you can start saving $300 a month now. Pay that $300 a month into your savings account first. Then pay all the other bills. Conceptually, what you are doing is subtracting that $300 from your income, forcing yourself to live within that reduced income. It’s like your pay was cut to $3700 a month and now you have to cut back.

These are, as I said above, very simple tricks. They are, however, very powerful tricks. The magic isn’t in what numbers you juggle around, it’s getting yourself into the habit of following one simple rule that’s easy to grasp and focus on. Whether it’s setting yourself an exercise plan (“I’m going to work out for twenty minutes every Sunday night.”) or managing your household finances, creating a simple rule for yourself and sticking to it come hell or high water is the way you get things done.

Pay your bills on time and in full. That’s all the budget you need.

Pay yourself first. Decide how much you want to save and put that money aside automatically, before paying any other bills.

Do those two things and you’ll be ahead of nearly every other person in the United States. Practically no one will be as good at managing their money as you. Take pride in your accomplishment.

Oh, and think about that exercise plan too.

Here Comes the Cavalry…But to Whose Rescue?

Posted by on March 17, 2008 No comments

Right now, I would like a lot of people to lose their homes.

OK, that’s perhaps overstating the case a bit. Allow me to explain.

You have surely by now heard about the housing crisis in the US. The one where home values are dropping and people who bought homes they couldn’t afford are being foreclosed on, and the banks who hold the mortgage paper are getting killed. (As I’ve said before; your bank doesn’t want your house; they want your money.) The Federal government is frantically slathering money all over the problem as politicians scramble to be seen saving the homes (and mortgages) of millions of registered voters.

The trouble is, that’s how this mess started. What with lots of loan money out there looking for borrowers, and lots of Federal guarantees on the loans, there was more and more money chasing houses and in certain markets the home prices became grossly inflated. The houses were soon priced out of the reach of most people, including the people who had actually bought them. As will happen in a free market, with no buyers the prices fell. With houses now worth less than the mortgage, many home owners are stuck in a terrible financial crunch.

Now the Fed is spending hundreds of billions of dollars — our dollars — to try and prop up those unreasonably high home prices, so the banks and homeowners won’t be hurt so badly.

Personally, I think it’s a damn bad use of my tax dollars. I don’t much care if those homes are ‘saved.’ I want home prices to drop precipitously. You heard me; I would love to see home prices in those overheated markets drop by 50-75%. (Any realtors or bankers reading this just fainted.) Yes, that would be ugly. Many families would suffer great financial hardship, and many banks would lose piles of money. But let’s be honest here. Their greed and stupidity got us into this mess. Do we want to spend hundreds of billions of dollars rescuing them?

In other words, should the rest of the country pick up the tab for them, so they don’t have to suffer the consequences of their bad decisions?

No. Let the people lose their houses, let the banks crumble. It will all sort itself out, fairly quickly. People who bought houses they couldn’t pay for will lose them, but home prices will fall back to a level at which people can actually afford to buy them. People who bought within their means will be unharmed. Lenders who engaged in shoddy practices will go out of business. Banks who behaved more sensibly will survive.

Let the prices fall and the economy will rebound fairly quickly. Keep the prices artificially high, and the economy will limp along for years. It’s like being very sick for a day or two, but then it passes and you feel better, versus just feeling kind of sick for weeks or months. You’re better off taking the hit and moving on.

That won’t happen here, of course. There’s an angle that I haven’t mentioned yet. As far as I know, it has hardly been mentioned at all. There’s a third party panicking at the sight of falling home values, besides the home owners and bankers.

The city and county tax offices. Most local governments get a majority of their revenue from property taxes. With values dropping, the tax base is eroding out from under these local governments. They got used to fat budgets when grossly inflated home values sent tax dollars pouring their way. (And that huge tax burden doubtless has a lot to do with why many people are walking away from their houses.) Now they have to cut back, and governments hate cutting back. They don’t like trimming a budget. If home prices continue to fall it’s going to put increased tax pressure on the remaining home owners to take up the slack in the tax rolls, and local services are going to decline, both of which are going to contribute to causing more people to walk away from their houses. Further diminishing the tax base.

Local governments desperately want to keep their inflated property taxes. I suspect, but cannot prove, that that has more to do with the Federal bailout of home owners than any desire to save people’s homes.

Governments don’t really care about people, you see. They do, however, care a great deal about their budgets.

If Saving is Outlawed, Only Outlaws Will Have Savings

Posted by on April 7, 2008 No comments

If you try to save some of your money you must hate America.

OK, no one has actually come right out and said that yet, but that is basically how US fiscal policy works. The US economy is based on consumers spending, and the system is set up to punish anyone who tries to save their money instead.

Take this tax rebate thing their going to be sending out soon. You’re supposed to immediately take that money down to your local mall and spend it. If you put it in the bank, or use it to pay down debt (like a sensible person), you’re not stimulating the economy like you’re supposed to.

It’s not just a matter of the government hoping that people will spend instead of save, either. They actually punish savers. Ever listen to the news and hear some reference to “The Fed” lowering interest rates in order to stimulate the economy. What that is is a tax on savings. When interest rates go down debtors don’t have to pay as much, but savers don’t get as much return on their investment. What the Fed is basically doing when they lower interest rates like that is taking money away from people who are trying to save it and giving it to people who want to spend it.

(You will also sometimes hear about The Fed lowering interest rates “to combat inflation.” That’s because lowering interest rates, and making more money available for people to borrow, is inflation, and every now and then it’s necessary to give the appearance of doing something about that.)

I don’t really know why the US Government wants its people to keep spending and go deeper into debt, but I can speculate. It probably never occurs to them that the economic well-being of individuals and families matters. Families just have mortgage and car payments, groceries to buy, and college tuitions to pay for, after all. They don’t have ticker symbols and trade on Wall Street.

Ordinary people, in other words, only matter in-so-far as they affect those stock prices, by giving their money to some company or other (or — horror! — not doing so). Perhaps I’m being overly cynical, but try listening to any day’s financial news, then tell me I’m being too cynical.

Of course, if you want to have money to send your kids to college, or to retire on, you have to save anyway. Just be aware that everyone’s hand is against you. You are, in your quiet way, an enemy of the state.

Be proud.

A Taxing Time

Posted by on April 14, 2008 No comments

It is, once again, time for all good citizens to send thousands of their hard-earned dollars to their penurious Uncle Sam, who, let’s be honest, is probably going to just blow it all on hookers and cocaine.

The whole Earth is covered up in tax-time advice, and I’m not going to try and add to that. I’m just going to point out something equally obvious.

If anyone wanted to bring about the downfall of the United States Government, there’s no need to waste time stocking up on RPGs in their secluded compound in Montana. Just do away with the payroll withholding tax. Require everyone to write a check for the full amount of their tax bill on April 15th. That would destroy the government twice over.

First, people would be horrified at outraged at the sudden realization as to how much they actually pay.

Second, hardly anyone would actually have the money to send.

Which, of course, is where there is a withholding tax in the first place. The…probe doesn’t hurt quite as much if it’s slid in just a little bit at a time.

Happy Tax Day.

Playing Little Money

Posted by on April 21, 2008 No comments

There’s a style of play in baseball known as ‘little ball’ or ‘small ball.’ What it boils down to is rather than always swinging for the bleachers just doing little things to move runners around the bases. Bunt, steal, sacrifice fly, take any small advantage you can get and move men slowly around the bases to score. Its not as dramatic a style of play as banging out home runs, but it can get the job done.

The same thing applies to your household finances. Clipping coupons may not have the same drama or thumping impact as a big raise at work, or winning the lottery, but the little things are easy to do and they add up.

The simplest thing you can do, if you have the self-control to handle a credit card, is to get a cash back card. There are a variety of different kinds, but they all have certain things in common. They give you 3% cash back on some of your purchases, and 1% on everything else. I have a few different cards, each offering a 3% kickback in different categories, to maximize the return. A 3% kickback on a five-buck meal at Wendy’s doesn’t amount to much, but 3% on a new laptop is something you can notice. And 3% on what we spend keeping two cars gassed up is definitely worthwhile.

Sometimes you can get a combo deal. Our local grocery store sells gas too and gives you a discount of ten cents per gallon for every $100 you spend there on groceries. I do my grocery shopping there, with a card that gives me a 3% kickback on purchases at grocery stores. Then I buy the — discounted — gas with the same card, which also gives 3% back on gas purchases.

It doesn’t take any particular effort at all to do. Just a few minutes to fill out a credit card application, or on the phone with customer service getting an account changed to a different type of card, and then it’s just a matter of pulling the right card out of your wallet. The return on that small investment is several hundred dollars a year.

Of course, if you’re going to try that, you have to pay off your credit card every month, or the interest charges will eat up any savings.

A lot of money can be saved simply by paying attention. People will quite commonly negotiate hard on big purchases, like cars and houses, but not pay much attention to the little things. (Men are notoriously bad about this.) For example, an item you buy every week on your regular grocery store expedition may cost twice as much at store A as it does at Store B. But you buy it at store A because most of the other stuff you buy is as cheap or cheaper there. Now, sometimes that’s just fine. There’s no sense spending two bucks in gas to drive to another store and save a buck on a package of hot dogs.

But something like that should raise a flag, tell you to look more closely at your purchasing patterns. You don’t want to set up some overly complicated plan, with so many different items at different stores that you can’t keep track of it. Keep it simple; compare two stores that carry the same items and which are both convenient to you. Look at the stuff you purchase regularly, and see which are significantly cheaper at which store.

You’ll probably end up with just a handful of items that are much cheaper at one store than the other. Keep doing your regular shopping at your usual store, but don’t buy those items there. (Barring emergencies, of course, or a killer sale.) Instead, every couple of weeks or so, depending on the stuff you’re buying, make a second trip to the other store and stock up on those cheaper items.

This little-money trick might take you ten or fifteen minutes of thought, to determine what stuff is noticeably cheaper at which store, but after that, it doesn’t take much effort at all. Just driving a few blocks every couple weeks.

Example. We do most of our grocery shopping at Kroger’s, the above-mentioned store with the gas kickback, and which also happens to be right around the corner. But a few things (most notably hot dogs — and with a hungry two-year old in the house we go through a lot of hot dogs) are a LOT cheaper at Wal-Mart. (Contrary to expectations, most of Kroger’s prices are very close, and cheaper in many cases.) So every now and then we drive the extra few blocks to Wal-Mart and stock up.

Stocking up on staple items is another good trick. We try to buy groceries that are on sale whenever possible, and buy enough of them to last until the next sale. I’d much rather buy three or four two-liters of Coke one week at $.89 a bottle and not buy any again for a month than buy one two-liter at $.89, then two or three at $1.59. That seventy-cent savings may not sound like much, but multiply by each item you can do it on, and do it for a year, and it adds up. It’s not unusual for us to have our grocery bill discounted by 30-40% by sales. Every week. And all it takes is buying more of the stuff on sale that you know you’re going to use (and which will keep) and sticking it on a shelf.

(Don’t get carried away with this. My grandfather used to buy cans of coffee whenever it was on sale, much to my grandmother’s disgust, even though they had a whole cabinet full of the stuff already. Their supply of coffee, in fact, outlasted both of them. I have no idea what eventually happened to it all.)

Then there are coupons.

Oh, who am I kidding. You’re not going to clip coupons. I don’t clip coupons. My wife, fortunately, does clip coupons. Sometimes she even remembers to use them before they expire.

People who are really dedicated can save huge amounts of money with coupons. For most of us it is, let’s be honest, too much trouble.

Once you start looking for them, and get in the mindset, you should see a lot of ways to save a few buck here and there. Down here in the desolate wasteland of north Texas, for example, keeping your house cool is a much bigger expense (and problem) than heating it. Once of the best investments I have made was a couple of years ago, when I spent a few hundred dollars to put dark solar screens on the south- and west-facing windows upstairs. That not only cut our electric bill by a significant fraction (about 25%), but it keeps the house much cooler and more comfortable when the temperatures outside exceed the melting point of lead.

Take a few minutes to look over your expenses and see if there are any ways you can move a few dollars here and there. It’s not a lot of money, but it’s sitting there waiting for you to find it and pick it up. You’re not just going to leave it there, are you?

The Pillars of Civilization Shaken

Posted by on October 6, 2008 No comments

A terrible crisis has been averted, at least for now.

You’ve probably heard about this so-called ‘Credit-Crunch’ that the United States is going through, but I will summarize very briefly. In the simplest terms, financial institutions and consumers in the US lent and borrowed so poorly, so stupidly, that the the system was in danger of grinding to a halt, with people and businesses only able to lend or borrow with great difficulty.

Obviously, that would be a terrible situation. Home prices in some markets would fall down to the point where middle-class families could afford them. People would have to live within their means, and might even begin to dig out from under a crushing burden of debt. Companies would have to manage their resources sensibly.

Spending, in short, would no longer exceed earnings. Taking out a home equity loan to go on vacation and buy a big screen HD TV would no longer be the order of the day.

Of course, some people would (and may yet) lose a lot of the stuff they bought that they couldn’t pay for, which would make them very upset.

Obviously this would never do. The financial institutions called up their friends in Washington and the government sprang into action with a rapidity hardly ever seen from our ponderous bureaucracy. A Bill was quickly thrown together, promising that the US Taxpayers (that’s you) would give the financial institutions hundreds of billions of dollars, no strings attached. But that Bill wasn’t bad enough, so they went back and put in a bunch of other crap, to make sure everyone got a little bit of the pie the taxpayers were so generously serving up. That passed, of course.

To paraphrase BusinessWeek, Wall Street and the US financial firms in general want the government to stay out of their business; they want no regulation or government oversight at all. But when they get in trouble, they want the government — meaning the taxpayers — to bail them out. This is exactly like a young adult who does not want his parents to have any say in how he (or she) conducts his life, but who wants them to pay his bills for him when they get to be too much. We wouldn’t put up with that from our kids, but we’ll send billions to people we don’t even know, just because they say they’d like to have it, thank you very much.

And, of course, because they threaten us with Financial Armageddon if we don’t give it to them. Government, remember, is all about fear.

Remember; saving is Un-American and will be punished. If you’re not over your head in debt, the government hates you and will take your money in order to help people who are over their head in debt. If you’re not willing to go into debt yourself, the government will do it for you.

Isn’t it nice of your Congressmen to do that for you? The Wall Street executives, running their companies into the ground and then bailing out with hundred-million dollar bonuses, appreciate your patriotic generosity.

History Pop Quiz

Posted by on February 23, 2009 No comments

Extraordinary optimism sustained an orgy of speculation. Books were written to prove that economic crisis was a phase which expanding business organisation and science had at last mastered. [….] In October a sudden and violent tempest swept over Wall Street. The intervention of the most powerful agencies failed to stem the tide of panic sales. A group of lending banks constituted a milliard-dollar pool to maintain and stabilise the market. All was in vain.

The whole wealth so swiftly gathered in the paper values of previous years vanished. The prosperity of millions of American homes had grown on a gigantic structure of inflated credit, now suddenly proved phantom. Apart from the nationwide speculation in shares which even the most famous banks had encouraged by easy loans, a vast system of purchase by installment of houses, furniture, cars, and numberless other kinds of household conveniences and indulgences had grown up. All now fell together.

It should not, however, be supposed that the fair vision of far greater wealth and comfort ever more widely shared, which had entranced the people of the United States, had nothing behind it but delusion and market frenzy. Never before had such immense quantities of goods of all kinds been produced, shared, and exchanged in any society. There is in fact no limit to the benefits which human beings may bestow upon one another by the highest exertion of their diligence and skill. This splendid manifestation had been shattered and cast down by vain imaginative processes and greed of gain which far outstripped the great achievement itself. –Winston Churchill

Winston was talking about events now 80 years gone. But history does not, despite the popular saying, repeat itself. It just gives pop quizzes to see if anyone was paying attention.

First They Came for the Smokers….

Posted by on August 26, 2009 No comments

Selling other people’s stuff is a very profitable business. Ask any burglar. It works just as well when the ‘stuff’ is intangible. Ask any government.

It has become common practice to persuade people to vote for restrictions on activities that they do not participate in. Don’t ride motorcycles? Then you probably won’t mind if there’s a law requiring motorcyclists to wear a helmet. Don’t own a gun? You probably won’t mind if there are more legal restrictions placed around gun ownership. Don’t smoke? You probably won’t mind if smokers are taxed more heavily, and limited more in where they can smoke. Don’t drink? You probably don’t mind if legal limits on blood alcohol are lowered to the point where having a bottle of beer in your refrigerator can make it illegal for you to drive. Not overweight? Then you probably won’t mind if overweight people have to pay more for health insurance, are maybe told how much they can eat, how much they have to exercise.

That’s a common refrain these days. This or that lifestyle choice–smokers, the overweight, people engaging in ‘risky’ behavior–are driving up the cost of health care. They are costing us money. (Whenever someone talks about someone’s behavior costing ‘us’ money in healthcare, what they really mean is that they are costing the insurance companies money. Keep that in mind.) They are a problem to be solved.

That sort of thinking is very troublesome. Everyone, you see, uses some sort of freedom that some other people don’t. Thus, everyone can be turned against everyone else, and in the end we all lose.

“First they came for the Communists, and I didn’t speak up, because I wasn’t a Communist. Then they came for the Jews, and I didn’t speak up, because I wasn’t a Jew. Then they came for the Catholics, and I didn’t speak up, because I was a Protestant. Then they came for me, and by that time there was no one left to speak up for me.” — Pastor Martin Niemöller

The old Roman saying, divide et impera is usually translated as ‘divide and conquer’ but that’s not quite right. A better translation would be, ‘divide and rule.’ Divide the people against each other, and you can always gain the support of one group in putting down any other. “He who robs Peter to pay Paul can always count on the support of Paul.” A cynical old aphorism, but our government today exceeds it. Now they rob Peter to pay Paul one year, and then rob Paul to pay Peter the next, and so gain the support of both.

We have forgotten something, here in America. We cluster in our little tribes–Democrat, Republican, Libertarian, Christian, Muslim, white, black, smoker, non-smoker, Mac, Windows–and we forget that ultimately, we are all in this together. If the country, if society as a whole, suffers, we all suffer. Eventually, the government will want to take something from you, and your neighbors will be more than willing to sell it to them. Just as you were willing to sell their stuff to the government.

Maybe it will cost us a little more money, allowing people to drink, smoke, be overweight, eat meat, drive cars, participate in sports. But isn’t freedom worth paying for? If it’s not, then what is?

Perhaps it is time to close ranks, at least on this one principle. Perhaps it is time to say, “No. Our freedoms belong to all of us, and they are not for sale.”

New Eyes

Posted by on March 11, 2010 No comments

After a year or so of increasingly being unable to see . . . well, anything, I finally broke down and bought myself some new glasses. Because of the amazing options available to consumers here in the future, I was able to indulge in a luxury that would have been unthinkable to me not many years ago.

I got myself three pairs of glasses.

One pair for general use. A pair of polycarbonate prescription sunglasses. And a pair of close-up glasses for working on the computer and reading. At first, after getting this wealth of eyewear, I was second guessing myself. I could see the computer screen well enough with the regular distance glasses; did I really need the computer glasses?

Then I noticed that if I wore the computer glasses, I didn’t have a headache after spending several hours on the computer. Oh, right!

I have to remember which pair I’m wearing, of course, and change them as appropriate, but that’s a small price to pay for being able to see, and not having to deal with headaches and eyestrain. Plus, there is the added bonus of confusing people when they see me wearing very different pairs of glasses over the course of the day. (I deliberately picked frames that look nothing like each other for the computer and distance glasses, so that I could easily tell them apart.)

The trick that makes all this possible is ordering the glasses online. I was able to get all three pairs for less than what the last pair I bought at the optician’s store cost. They’re not designer frames (though you can get those online too, and still save a significant amount of money), but they’re quite nice. I’m impressed by the look and quality of them.

The sunglasses and computer glasses came from 39DollarGlasses.com and the distance glasses came from EyeBuyDirect.com. (Link and coupon codes–10 and 15% off– courtesy of Glassyeyes) Both are quite good and they were delivered in about two weeks. Comparable to what I’d expect from my local optician.

If you wear glasses, treat yourself to the luxury of multiple pairs, and pay less too.