May 24, 2011

• Bad Math, Lemmings, and The Need To Read

  I’ve been concerned about the Economy since about ten years back, when I was part of a focus group at Princeton, that was asking people where they got their information for planning for their financial futures. I will give them this…they did a GREAT job of choosing panelists. Every group, gender, and financial and social or racial strata was represented. Clearly, they knew what they were asking…and clearly, they missed a serious point. At least half the people in the room HAD NO FINANCIAL plan. They were mostly still working—their focus was to stay alive. Planning for their retirement was something that wasn’t going to happen, because that would suggest they had excess to put away for that purpose.

  The panel continued to ask them if they were more likely to obtain their information from television, newspapers, magazines, etc…and the focus group kept staring at them blankly. I had the chance during a break to address on of their economists, and I asked a question that had nagged at me. “How is Social Security going to cover the Baby Boomers, if there are already issues about shortages? ” (Remember…this was a decade ago.) He winced. “Well, that’s complicated.” he said, earnestly.

  So when Wall Street went bonkers, before the Crash of 2008, I was already thinking that my generation was in for a right royal screwing. I knew there were a lot of people, who had worked most of their lives, and had almost nothing set aside for their retirement years. We then had the joy of watching what happened to those who did save, and invest…only to watch their retirements dissolve when real estate imploded…taking Wall Street with it.  People who had retired early found themselves competing with high school kids for jobs at McDonalds. Others were down sized years, or even months before they could retire.

  Chaos is a good word for it.
  Now people are insane on the topic of taxes, everyone is demanding smaller government, and the hits just keep on coming. Much of this could have been avoided if People just READ more. (I know…sounds simplistic, huh?) But I am dead serious. We don’t read. We don’t question. When it was suggested that people could afford homes without proving they had the income to pay the mortgages, we should have read more. Not the ads, that promised paradise for no money down…but the BORING details…the actual numbers.

  I’m not great at math, but even I could have told you:

  1. There is only so much pie. That means the taxes we all pay are finite. Running our country is wildly expensive—and the last thing we needed was a two front war that costs a minimum of a billion dollars a day to finance.

  2. The radical shift in personal wealth in this country is becoming terrifying.  The top one percent of the nations earners controlled almost 24 percent of ALL the money in the United States. We have 330 million people. You can do the math. But one percent? That’s a teeny number…and then the other 99 percent come in.  Yikes?

  We need to read.
  When a politician suggested that the answer was to cut taxes, but then voted to spend money they kept saying we didn’t have? We needed to read.

  When they told us that “regulation” was hampering business, and that Government had no business telling corporations what to do? We needed to read, to remind ourselves that businesses are not always wise…or right.

  When those same companies demanded that we bail them out, we needed to read…to figure out how we would be repaid for our efforts…and when.

  We needed to read, when they starting the “Medicare Voucher” nonsense…cutting an entire generation who had ALREADY paid into that system off from actual coverage…but I’m pretty sure a lot of people haven’t even noticed that.

  We needed to read when they tried to convince us that “taxing the rich” would somehow crash our economy—which was already in a ditch…and starving out the middle class,who’s taxes supported the people above and below them in income was somehow ok.

  We needed to stop acting like reading half a dozen blogs was like reading a newspaper…and we needed to ask questions when the math was so completely nuts, that any grade school child could have told you it was never going to work.

  But that requires thought, attention, and time…something we claim we are all too busy to do.

  The cliff is that way…have a nice trip.

  • 8:08 am
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