Suze Orman and the FIRE Movement

            I’ve been very interested to see the progress of the FIRE movement. For those not acquainted with the term, it stands for financial independence, retire early. Unlike earlier frugality movements, this one has been getting serious attention from the media. Perhaps that’s because journalists are an endangered species these days and recognize the wisdom of cutting consumption and saving money in an increasing likelihood of unemployment. I’m looking forward to Scott Reickens’ new book, Playing with FIRE, which is due out in January. I’m trying to get a review copy, but you may have to wait for me to get a copy from the library.

            When the frugality movement of the 1990s began, those of us who were part of it were at first covered by serious writers, among them Nick Ravo of the New York Times, who gave Living Cheap News the mention that got it going. Soon, however, we were covered by writers eager to make fun of the movement. Amy Dacyczyn, after she had ceased publishing her wildly successful Tightwad Gazette in 1996 was “encouraged” by a reporter to open up her life. She did, and the reporter wrote a scathing article about Amy’s deprived children and bare bones lifestyle. The same reporter, who was at that time childless, went on to write another article advising women not to leave the workforce when they had children.

            I was encouraged that the coverage of the FIRE movement had been overwhelmingly positive, and every once in a while I check the Mr. Money Moustache website to see what’s going on, which is how I discovered that Suze Orman hates, hates, hates, hates the movement.

            Her interview with Paula Pant, whose podcast is titled “Afford Anything,” is available on YouTube and, I’m sure, elsewhere. It’s cringeworthy and about an hour and ten minutes long. It’s worth listening to if you want to hear something worthy of an overlong Saturday Night Live skit, but there’s no reason to suffer through it, as I did, because I’m going to give you the short version.

            If you’re going to watch it, though, I suggest you first have a glass of wine and watch the Kinsey Sicks version of “Don’t Be Happy. Worry,” which is also on YouTube and sums up Suze’s position on the FIRE movement and pretty much everything else.

            First, Suze says $2 million is not enough to retire on. Especially if you retire at a young age. Suze seems to think FIers retire with their nest egg and start spending it down. She does not have enough grasp of the movement to realize we try not only not to touch our principal, but to add to it. Suze then goes on to say things happen. You could be hit by a car. You could get run over by a bus. You could fall down on the ice. You could get cancer. Further, artificial intelligence is coming. In 2030, unemployment could be 25%. That means those who are working will be taxed at higher rates. Social Security and Medicare will be gone. Your money may not last, and you’re not adding to your retirement accounts.

            Reality check here. Do you suppose anyone who gets hit by a car, run over by a bus, falls on the ice, or gets cancer laments not working while they were healthy enough to enjoy their lives?

            Suze, who once earned and lived on $400 a month, says a safe spending amount per year would be $350,000 after taxes. When pressed, she says $10 million may be enough to retire on. When pressed further about people who spend their whole lives earning $50,000 or less, Suze says they’re more ready for retirement because they’re used to living on less.

            Suze spends a great deal of this interview telling how rich she is. Why, just a few years ago, she sold five of her houses, canceled a bunch of her commitments, and moved to her own private island where she spent time on her yacht learning how to be its captain. But she got bored and was welcomed back by her fans who wondered why she’d ever deserted them—sort of like hearing this story from the Norma Desmond perspective—and she’s flogging a new book.

            In short, Suze says she's smart and rich, so listen to her. People who didn’t have wound up putting a gun to their heads.

            She compares FIers to those who got on the duck boat that sank here in Missouri. Those people, after all, thought they were safe and look what happened, so work as long as you possibly can in an area you love so you don’t feel that it’s work. At this point I couldn’t help but be reminded of Kurt Vonnegut’s Slaughterhouse Five, which is one of the texts for my history class, and I wondered if Suze had been kidnapped by the Tralfadamoreans because she’s certainly not living on planet American middle class.

            Suze’s ideal retirement age is 70 at which time a person can get their maximum Social Security benefit. (Remember Social Security? That program that won’t be around in 2030?) She reminds us once again that $2 million is “nothing,” and that people who retire early “don’t have a passion” and will spend their long retirement “sitting and doing nothing,” which I found funny because it was a great effort on my part to carve out the time to listen to this drivel.

            It is OK with Suze if a new mother stays home to raise her children, but once that kid’s in school, the mother needs to get back in the labor force. She’s even opposed to college students taking a gap year. But two to six weeks is OK if you’ve maxed out your retirement contributions and have eight months of living expenses in the bank.

            I find it amazing that anyone would let this nutcase tell them how to live their lives. As someone who retired early—nearly 25 years ago, I can tell you it was pretty darned easy for me. I had the guidance of Paul Terhorst’s Cashing in on the American Dream to show me what an early retirement could be like and Joe Dominguez’ and Vicki Robin’s Your Money or Your Life to take me through the math to show me it was possible. When I left Company L, I was living on my passive income, so I moved my 401(k) to my IRA. I am extremely lazy about money, and I did not want to have to think about it every day, so I bought zero coupon treasuries. I planned not to have to touch the IRA until I reached age seventy, and I didn’t. In the meantime, I have been able to add to my non-IRA principal by, among other things, finding an enjoyable consulting gig that lasted four years and living on less income than the accounts earn.

            Unlike Suze, I do not have a private island, a private plane, or a yacht. And, I’m extremely happy to report I only have one house. Woe is me.

            But I have had almost a quarter of a century to do pretty much as I pleased.

            Maybe it’s time for another glass of wine and another viewing of “Don’t be Happy. Worry.”

© 2018 Larry Roth

Tango War: A Review of the Book by Mary Jo McConahay

            It’s been pointed out to me that I’ve been neglecting my blog lately. I found out the University of Missouri-Kansas City (UMKC) has a program for seniors that lets us take a class for $25. We don’t get credit, and, while we probably don’t have to do the assignments, I’ve been doing them anyway. The class I’m taking is a history class, and the assignments are papers. One reason I was excited to take the class is I wanted to get out of my routine and be around people who are not part of my generation—not that there’s anything wrong with my generation, but variety is the spice of life.

            It shouldn’t be a surprise that classes these days are a lot different than those I took fifty years ago. In the “good old days” lectures were simply that. The teacher would talk, and we’d take notes. Nowadays the lecture is on PowerPoint, and we get to watch the occasional film clip on YouTube. The professor is excellent (and since I can’t flunk, I don’t have to suck up). Alas, he’s retiring after the next semester.

            So that’s what’s been occupying my time.

            Nevertheless, I came across a book I highly recommend, and I’d like to get the word out.

            In August I saw an obituary in The New York Times that caught my eye. Isamu Shibayama, an ethnic Japanese detained after Pearl Harbor died at age 88. During the war, of course, many ethnic Japanese were put in detention centers, so you’re probably wondering what’s so special about Mr. Shibayama. What’s unusual about him is he was detained in Peru, where he and his family lived and where Mr. Shibayama was born in 1930. The family had emigrated to Peru to work in the cotton industry and had become quite wealthy, which is probably the reason they were rounded up and, with 2,000 other ethnic Japanese living in Peru, shipped to the United States and interned in Crystal City, Texas. After the war the U.S. wanted to deport the family to Japan because they had entered the country “illegally.” More on that later. While fighting deportation, Mr. Shibayama, still classified as an illegal immigrant, was drafted in 1952 and served in Germany. After he completed his service, a helpful immigration official recommended he go to Canada and re-enter the U. S. from there after which he’d have to wait five years to apply for citizenship. In 1988 Japanese-Americans who had been interned were awarded $20,000 provided they were still alive to receive the money. That only applied to citizens or permanent residents. In 1999 a coalition of Japanese Latin Americans won reparations of $5,000. Mr. Shabayama and two of his brothers declined the payment and sued. They lost that suit and appealed to the Inter-American Commission on Human rights in 2002. Mr. Shibayama’s brothers are still awaiting a decision.

            It was news to me that the U. S. had citizens from other countries kidnapped and interned here during the war. But wait, there’s more.

            In October I read a review of Mary Jo McConahay’s The Tango War: The Struggle for the Hearts, Minds and Riches of Latin America during World War II and got a copy at the library. The book was an eye-opener for me. Latin America has a great many strategic materials, from oil in Mexico to cotton in Peru to tungsten, necessary for armor-piercing weaponry, in Argentina to rubber (which was a biggie in those days before synthetic rubber) along the Amazon.

In the early days of aviation, Italy and Germany started airlines to serve Latin America, shaving time off land routes that meandered over mountains and often flying where there were no roads at all. Latin America was largely made up of European immigrants, many of whom were from Germany and had constructed villages that looked German and where German was the first language. The Germans, especially the wealthy ones, would, like the Japanese, become targets for deportation and internment in the U. S. Both German and Japanese deportees had their property and businesses confiscated and their assets frozen.

The reason for the U. S. detaining ethnic Japanese and German deportees was to have prisoners to exchange for Americans held in enemy prison camps. While to a degree this may seem justified, many of these detainees, like Mr. Shibayama, knew little about the countries of their ethnicity and did not even speak the language. How many of us can speak the language of our forebears unless that language was English? Another act by the U. S. was to confiscate the passports of people being relocated to the U. S. unwillingly and then arrest them for entering without papers! This was all news to me, and I thought I knew history!

The book discusses American efforts to win the hearts and minds of Latin Americans with the aid of Walt Disney (successful) and Orson Welles (not so much). J. Edgar Hoover makes several appearances, mostly fighting for turf against what would become the CIA. Hoover may well have screwed up what could have been a warning about Pearl Harbor because he personally did not approve of the extracurricular activities of a double agent who was code named “Tricycle” because of his ability to bed two women at once. Ernesto Guevera Lynch, an anti-fascist and father of Che Guevera, reported on suspicious German activity in Argentina. His reports were ignored.

Ms. McConahay discusses the Mexican airmen who ferried aircraft over the Pacific and made bombing runs over Formosa and Luzon and the Brazilian combatants who fought bravely in Italy, where they are remembered, and returned to Brazil, where they were forgotten in no small part because of a government unwilling to share the limelight with heroes.

As interesting as the war coverage is, what Ms. McConahay describes after the war is just as intriguing. In his 1999 Hitler’s Pope: The Secret History of Pius XII, John Cornwell described the wartime activities of Pius XII. Ms. McConahay does as well, but she explains that Pius saw the war as a battle between atheistic communism and fascists who, although they were anti-Semitic murderers, were not anti-church. (The same approach this administration is taking with Saudi Arabia—they may be murderous bastards, but they’re good business partners.) Ms.  McConahay says that Pius XI, Pius XII’s predecessor, condemned Nazi neo-paganism and the “so-called myth of race and blood” shortly before he died. Pius XII, however, took a different route. The church set up “Ratlines” to allow Nazis to escape using its network of monasteries and parishes. Among those who traveled the Ratlines to Latin America were Joseph Mengele, Adolf Eichmann, and Klaus Barbie.

Ms. McConahay follows the activities of former Nazis into the 1960s and 1970s, where they proved helpful to Latin American dictators who set up camps for dissenters, many of whom “disappeared.”

This is a history book that’s long overdue.  

Squeezed--A Review of the Book by Alissa Quart

          I read several reviews of Alissa Quart’s Squeezed: Why Our Families Can’t Afford America, so I put in a request for it from the library. Evidently many people had read the reviews, since there were several people ahead of me waiting for the book.

          It was a disappointment. Rather than analyzing the lopsided economics of our times, Ms. Quart, a new mother, complains about how expensive it is to have and raise a child. And she finds other people who have discovered, after the fact, apparently, that—gasp!--it costs money to have children. A lot of money.

          You’d think this would not come as a surprise, but it seems never to have occurred to the vast majority of people Ms. Quart interviewed—mostly (but not all) women—that children are expensive.

          I realize I’m on thin ice here—when I expressed the views I’m going to repeat here in Living Cheap I got a surprising amount of hate mail, and that was before the age of social media. Nevertheless, I think it’s worth reminding people that when you decide to have a child, that does not mean the world will become your babysitter and will suddenly cater to your every whim or tolerate the antics of your little darlings. I mentioned in Living Cheap that I’d been in a checkout line and a child began banging her mother’s shopping cart into my legs. And the little darling kept banging that cart into my legs. After three bangs or so I said, “Will you please stop that?” You’d think the mother would do something, but you’d be wrong. The mother said very loudly, “You’ll have to excuse her. She’s just a child.” Nope. I don’t have to excuse her, and I certainly don’t have to excuse her lout of a mother. That was probably thirty years ago, and I often wonder if that little darling is in prison.

          Back to the book. Ms. Quart found herself financially strapped after the birth of her child. She and her husband are freelance writers who live in New York, so they could work from anywhere. They considered moving and checked out Austin, Texas and Portland, Oregon, neither of which is known for low prices, and decided to remain in New York. If they had been serious about moving to a lower cost of living area, they might have checked out some cities that are less hip but nevertheless are charming and cheap.

          Ms. Quart hops on to the women and unpaid housework bandwagon without evidently realizing that this is the Twenty-first Century, and many men have (understandably) chosen to remain single and manage to keep their homes clean. And there are gay male couples who are not always complaining about doing housework and asking for taxpayer funds to compensate them for keeping their places clean.

          The first 252 or so pages of this 265-page book are one long whine fest. In the last thirteen pages Ms. Quart discusses “What is to be done?”  By the time she gets to this point, she has already discussed the Universal Basic Income in terms of what a difference her parenting experience would have been had it been underwritten by the UBI. I’m not sure what part of “basic” she doesn’t understand. She goes further. Americans would receive extra money simply for having children. This would be in addition to the Child Tax Credit, which Ms. Quart erroneously says is worth up to $1,000 per child. It is now worth $2,000, and that change had been made well before this book was published. She also wants high quality subsidized day care.

          She comes up with suggestions that would involve people doing something for themselves—coparenting and cohousing, for example. And of course (again) rethink gender roles—those selfish men are just not doing their share of scrubbing and toy cleanup as much as their female partners do. And finally (finally!) parents can start to talk openly about social class.

          I wanted to like this book, but I just can’t recommend a book written by someone who is so entitled that she seems to think she is doing the country a favor by reproducing and should be compensated for doing so.

          Admittedly, the country is in a demographic bind. Fewer people (wisely) are having children, and the country is aging. But there’s a solution for this problem.

          We are very fortunate to live in a country that people want to move to. Many of these people are already educated and a great many already speak English. Three years ago I was in the Greek islands off the coast of Turkey and had a brief opportunity to come into contact with some Syrian refugees. The ones I met were middle class and many were fluent English speakers. These people and others like them would move just for the opportunities they’d have here that they don’t have in their current home countries, and they wouldn’t be asking the country to subsidize their offspring.

          So before you make the choice to become pregnant, please make sure you can afford to have a child, and please remember the responsibility for seeing that child cared for and educated is yours.

© 2018 Larry Roth

A Brief Look at a Couple of Really Dumb Ideas

          When I did Living Cheap News, I had a section titled “Dumb Idea of the Month.” There was always a wide selection to choose from.

          I recently came across two news items that I think deserve mention, and no, our streetcar is not one of them. That may well qualify as the dumb idea of the century if not the millennium.

          The first dumb idea comes from Miguel McKelvey, co-founder of and culture officer for New York based WeWork, a co-working firm. He announced that not only will WeWork not serve meat at company functions, it will not reimburse employee meals that contain meat while WeWork employees travel on business. WeWork wisely did not impose those restrictions on those who rent space from them.

          I find this dumb on so many levels but most of all on the level that Mr. McKelvey thinks his employees should not eat meat, so he plans to do what he can to impose his views on his employees. Who knows what’s next? Perhaps lowered performance evaluations for meat eaters?

          The second dumb idea demonstrates that we have a government that works—just not for us. The IRS now has enough data that it has the capability to prepopulate information on a tax form for each of us. Imagine how simple this would be. You get a free online tax form showing your salary, your interest, etc. It’s almost as easy as the postcard our president promised. But it’s not going to happen.

          There is legislation working its way through Congress to prevent the IRS from providing any such assistance, courtesy of our own H&R Block as well as Intuit, the company behind TurboTax.

          Can you imagine not only how easy this would have been? And how much effort and money it would have saved, not only for taxpayers, but also for the IRS, which would probably not have to spend so much money getting people to correct errors that such an online form would have prevented? 

© 2018 Larry Roth

"Give People Money" and "The War on Normal People"--Two Books on Avoiding Dystopia

          Annie Lowrey’s Give People Money: How a Universal Basic Income Would End Poverty, Revolutionize Work, and Remake the World does not really demonstrate how a universal basic income (UBI) would do any of the things listed in its subtitle. This may well not be Ms. Lowrey’s fault, since my experience is publishers will take liberties with titles. My book, The Simple Life, for example was initially titled The New Frugality Anthology, but the publisher decided frugality was too downscale. One contributor dropped out of the project as a result of the title change. If you’ve ever read an issue of Real Simple, you can see why. “Simple” these days can be quite expensive.

          Anyway, back to Ms. Lowrey’s book. It gives a good definition of UBI: “It is universal, in the sense that every resident of a given community or country receives it. It is basic in that it is just enough to live on and not more. And it is income.”

          Ms. Lowrey goes into the history of the UBI, which I found one of the more interesting parts of the book. The Romans had a form of it; Elizabethan England discussed it as a means to alleviate the poverty caused by the enclosure of the commons and the resultant migration to cities. Bismarck proposed a version for Germany. Richard Nixon, Milton Friedman, and other conservatives considered it in the 1970s. Alas, in this country the idea has so far come to naught. It’s like Will Rogers’ comment on the weather—everybody talks about it, but nobody does anything. Maybe this time will be different.

          The book is good when it stays on track. It describes a family of six living in a studio apartment. All have low paying jobs, and some have two jobs. One person contacted her employer (a fast food chain) about how to make ends meet and was told how to apply for food stamps, housing assistance, etc. Ms. Lowrey visits Maine and encounters a woman who has fallen through the holes in the safety net. Ms. Lowrey says the holes are there on purpose—to punish the poor--and points out that with a UBI the bureaucracy could go away (maybe then learning what it is like to be poor themselves—my observation). She points out that many of the benefits the poor have to jump through hoops to get—housing assistance, for example, are readily available to the middle class—the mortgage deduction, for example.

          Unfortunately, the book goes off the track. Ms. Lowrey begins the book with a visit to the DMZ between North and South Korea, goes to Kenya to see how a nonprofit’s $20 a month contribution to everyone in a village has made a difference, and travels to India to see how screwed up a bureaucracy can get—as if she couldn’t find examples in this country. (I could suggest one where local infrastructure is going to hell while subsidized apartments for the rich and a streetcar that duplicates existing bus routes are priorities.) I couldn’t help but wonder if these foreign adventures were not just padding for a 208-page book that could well have been better if it had been shorter.

          Toward the end of the book Ms. Lowrey examines the cost of the program and recognizes that it will be expensive. She then says it may have to be means tested, which means it would not, by definition, be universal, and those who would pay most for the program would not benefit.

          I began the next book on the UBI, The War on Normal People, by Andrew Yang reluctantly. Robert B. Reich had reviewed both in a single review and said, “The two books cover so much of the same terrain that I’m tempted to wonder whether they were written by the same robot… .” After reading both books, I’m tempted to wonder whether Mr. Reich did the same.

          Mr. Yang’s background is orders of magnitude different from Ms. Lowrey’s, as is his book. Yes, they describe many of the same issues, but Mr. Yang has started many companies and has seen the effects of automation from both sides. His book didn’t need padding.

          If you’re in a hurry and can accept that we have major issues of income disparity and that automation will lead to mass unemployment, you can skip to page 165, which is where Mr. Yang proposes solutions. One of which is, of course, a UBI (paid for by a value-added tax). But there are others, including a “Social Credits” program whereby those unemployed and living in areas where there are few if any jobs can earn these credits by helping their neighbors—sort of a barter program that would enable social engagement as well as trading time for services or items of value. Mr. Yang says there are already such programs in nearly 200 communities. He also proposes what he calls Human Capitalism, or investing in activities that are undervalued but necessary, such as teaching, caretaking, and so on. He also proposes that those who adopt practices that put capital over human interests be held personally accountable. He gives the example of Purdue Pharma, which introduced and falsely promoted OxyContin as “nonaddictive and tamper-proof,” leading to the opioid crisis we have now. The company was fined $635 million in 2007, but it made $35 billion since releasing OxyContin in 1995, so the fine amounted to 2%. I also question what good these fines do. The government gets the money. The public gets screwed. At any rate, in Mr. Yang’s world, the Sackler family (who owns Purdue Pharma) would spend time in jail. He also discusses how the same script played out during and after the financial crisis.

          He has some interesting proposals on health care as well. By the way, have you noticed a resounding silence on the part of Republican candidates about the “progress” made dismantling Obamacare?

          I don’t want to steal all of Mr. Yang’s thunder, but one of the closing chapters, “Building People,” has some great ideas on, well, building people. He recommends keeping parents together, an idea conservatives should cheer, and enabling families to have time to spend together, and time is one thing the new world Mr. Yang sees coming will give us.

          Whether we make people spend this extra time in poverty or guarantee a basic level of comfort is yet to be seen. 

         

          Before you say UBI will never happen, consider this: Mr. Yang’s circle is comprised of the very wealthy. He and many of his friends see the following scenario:

          “There will be a shrinking number of affluent people in a handful of megacities and those who cut their hair and take care of their children. There will also be enormous numbers of increasingly destitute and displaced people in decaying towns around the country that trucks drive past without stopping. Some of my friends project a violent revolution if this picture comes to pass. History would suggest this is exactly what will happen.”

          Many of his friends are buying secure properties. I suggest it would be cheaper to recognize the probable future and avoid the revolution.

© 2018 Larry Roth

Cambria, California: A Town Without Chain Stores and Fast Food Restaurants,or the Downside of "A Stop in Willoughby"

One of the main reasons for our trip to California was to see the Hearst Castle. It is definitely worth the price of admission.

Our hotel reservations were in Cambria. We had spent a couple of days in Monterey before driving to Cambria. When we arrived I was in the mood for some coffee. We checked in, and I asked if there was a McDonald’s or something similar nearby. The clerk looked shocked. He said, “We don’t allow fast food restaurants in Cambria. We also don’t allow big box stores or chain stores of any kind.”

We wound up getting $5 coffees ($6 with tip) at one of the stores they do allow.

A few years ago we had an abandoned school in our neighborhood. The city wanted to sell the land and accepted some proposals for the sale. One was for a grocery store that was considering relocating. That proposal would have required tax incentives and was greeted with great enthusiasm from many in the neighborhood. As it turned out, that proposal was just a ploy to get the store’s landlord to the negotiating table to lower its lease. The other proposal was from Walmart, which wanted to put one of its neighborhood markets on the land. The store Walmart proposed would have been smaller than the grocery store, and Walmart asked for no incentives. Walmart would even have taken the school building down. The shit hit the fan. After the smoke cleared, Walmart withdrew its proposal. A few years later the city took the building down at taxpayer expense, and the property remains unsold.

The anti-Walmart people won.

I wish everyone who opposes chains could spend some time in Cambria. At first glance, the town is charming. But it’s also expensive. It’s all well and good to limit competition, I suppose, if you’re a shop or restaurant owner, but it’s not too great when you’re on the paying end of the equation. Our afternoon meal the first day cost $30. I had fish and chips (with coleslaw instead of the chips); Dan had a taco salad. We both had water.

I told myself this was a vacation and we should enjoy it, but the final straw was breakfast, which was nothing special and cost $38. We decided to find a grocery store, which was not as easy as you’d think. We finally asked a guy who was working on recycling bins. He directed us to the store, which did not face the street. We bought some groceries and deli food and made do for that evening and the next morning.

We left Cambria and headed to our next stop, Pismo Beach. Along the way I spotted a McDonald’s and a Burger King at Morro Bay. We stopped and had lunch at Burger King with coupons I’d brought along for an emergency. It cost $12.36 for both of us, and we had soft drinks. We hadn’t planned to stop at Morro Bay, but while we were there, we drove around and spent some time on the piers watching fish being cleaned on the boats they came in on and the seagulls feeding on the waste tossed overboard. It was a charming afternoon.

To bring our total trip costs down, we ate at Burger King (using coupons) three more times on the trip. Breakfast cost close to $8, which I found much more palatable than $38.

          I’ve read and written about some of the “back to a golden era” books, and I doubt there ever really was a “golden era.” Even during the “golden era,” people complained that the (now bankrupt) A&P stores were driving mom and pop grocery stores out of business (as documented by Marc Levinson in his 2012 book, The Great A&P and the Struggle for Small Business in America). Before that people complained about catalog companies like (the now troubled) Sears and (the now bankrupt) Montgomery Ward, and before that door-to-door peddlers. It seems people like to complain about things—even things that make their lives easier and cheaper.

          “A Stop at Willoughby,” a 1960 Twilight Zone episode, tells the tale of a man, harried by modern life (nearly 60 years ago), who visits Willoughby, a stop on his commuter train ride home. Willoughby is a town that evokes the good old days (as seen from 1960—an era some folks nowadays look back on as the good old days). Eventually the man decides to stay in Willoughby. Spoiler alert: It turns out Willoughby exists only in the harried commuter’s mind. His stop in Willoughby is a fatal exit from the moving train.

          I wonder if the people who complain about how degraded America has become because of fast food chains, Walmart, and all the modern (competitive) businesses that are available today and long for their own personal Willoughbys ever think what life would really be like if everything were local and expensive.

          Perhaps they should be required to spend some time in Cambria.

© 2018 Larry Roth

California Real Estate: Sustainable or Just Another Example of Extraordinary Popular Delusions and the Madness of Crowds?

Silicon Valley is in a real estate frenzy. Frankly, I think the market is slowing down, but that’s just based on my observation, which lasted a whole weekend. That’s not saying prices will come down—just that they may not go up as fast as they have been.

The real estate market out there is and has always been, in my experience, different. The first time I moved there, in 1976, I wanted to offer less than the listing price. The agent was shocked. “Oh, you don’t want to insult the seller,” she said. And this attitude has prevailed (except for the early 1990s when a recession hit the area—I wasn’t there during the last crash, so I don’t know how prices were affected then). As an example of how entitled Silicon Valley sellers are, there was a letter to a real estate columnist in the July 15 San Jose Mercury News complaining that it had taken their agent three weeks to bring them a full-price offer when their neighbors had several offers over asking price in just a few days for an “inferior” house. Imagine! Complaining about a full-price offer. And about those prices.

Strawberry Square, a development of 350 townhouses, is my gauge. I sold my 4 bedroom 2½ bath 1,440 square foot unit there in 1994 for under $200K. A similar unit was for sale during our trip for $1.2 million. It appears to have sold. These units were built in the 1970s and priced around $30,000. They were built on slabs and without air conditioning, and while you can put air conditioning in the units, it has to be routed through the (hot) attic and is an expensive proposition. In spite of the fact that temperatures can get well over 100º, everyone assures buyers, “Oh, you don’t need air conditioning,” which might have seemed reasonable at $30,000, but for $1.2 mil?

          Our host lives in a townhouse she and her late husband bought in the 1980s for $150,000 that could bring well over $1.5 mil today because of its location. She assured us there’s nothing under $1 million in Silicon Valley, and I tend to believe her. Dan and I went to a couple of open houses—one is a 4 bedroom 2 bath house on a busy street priced at $1.7 mil. This house appears to have been redone by a flipper—on the surface it looked great, but it was redone on the cheap; it still has the original 1970s aluminum windows (and no air conditioning). The other open house we went to is a 3 bedroom 2½ bath townhouse priced at $1.398 mil. One reason I think the market is slowing down is this unit was reduced (gasp!!!) from $1.448 mil.

          These houses are in my old neighborhood, west San Jose. Prices are much higher in Sunnyvale, Mountain View, etc.

          High housing prices are not limited to Silicon Valley. We visited a 2 bedroom 1 bath in Pacific Grove, near Monterey, that is priced at $749,500. The house was built in 1909 and has no driveway, garage, or functional parking in front of the house. It also needs a new sewer line. And though there’s no air conditioning, you really don’t need it there.

          We saw high prices all over California, which begs the question—how do people manage to find a place to live there? That’s a tough one. Some people don’t. As we were driving on Santa Monica Boulevard in Los Angeles we saw a large homeless camp under a freeway overpass. Our host in San Jose and I talked to a guard at Airframe Supply while Dan was doing his business there. The guard drives two hours each way to his job and shares an apartment with his father.

          California has two classes of people—those with homes and everyone else, and those with homes don’t seem too interested in those without.

          Housing in California is complicated. Proposition 13 was passed in 1978. It limited property taxes to 1% of the sales price of the home. I believe taxes were allowed to escalate at something like 2% a year, but voters can (and have) approved add-ons (kind of like the streetcar add-ons we will soon have) and “special” taxes can be added as well. Nevertheless, tax rates are much lower for people who bought way back when, and those people are only going to let go of their houses when they die. For people in the market now, even without the add-ons and special taxes, the buyer of a million dollar house will have an annual $10,000 tax bill.

          With interest rates going up and interest and state and local tax deductions being limited, I wonder how sustainable this boom is, but it’s almost always wrong to bet against California real estate.

          Which brings me to the question almost everybody asks: Don’t you wish you’d stayed?

          In a word, no. As I mentioned in my previous post, we stayed with the widow of the man who wound up with my job after I left. I believe the job contributed in a major way to his death. He had diabetes, and as far as I know, Company L did nothing to accommodate his illness. He went on disability a couple of years after I left. I visited him in 2000. He eventually lost both legs. He told me, even in that condition, he was happier than he’d ever been at Company L. That’s how much that job sucked. He died in 2004. If I had stayed, I doubt I would have fared any better.

          My house is definitely not worth a million dollars, but it’s nicer than anything we looked at in California.

And I have a life.  

© 2018 Larry Roth

Legal Pot: California Turns a Liability into an Asset

          Dan and I just returned from our trip to California. I had some frequent flyer miles to use or lose, and Dan had never been south of San Francisco, so I decided to use some miles to revisit some of my old haunts.

          We started in San Jose, where I lived for ten years, and ended in Los Angeles, where I lived for two years.

          The part of our trip that people seem most interested in is our visit to a pot dispensary, so that’s the part of the trip I’ll write about first. I’m going to be honest here and admit I’m no expert on pot. I tried it once in 1976, and I felt… nothing. And yes, I inhaled.

          I knew Dan wanted to visit a dispensary, but I didn’t know it was such a priority. He wound up convincing our host, the widow of the man who wound up with my job after I left it, to take him to a dispensary the first day we were in San Jose. We wound up at Airfield Supply, which is right by the San Jose airport.

          We had to show our ID to get in the store. Once in the store, we had to sign a disclosure form releasing Airfield Supply from liability for anything we might say, do, or stand by as a result of any purchase we might make. Only after that were we allowed into the part of the store with the products.

          I was around in the 1960s, and this store is not what I was expecting, which was a bunch of stoned long-haired hippie types saying “Dude,” “Cool,” etc. The staff could have been mistaken for the younger folks I worked with at Company L (the Los Angeles Times ran an article in its July 15 Business section titled “From Tech to Toke” on how tech workers are migrating to jobs in the “cannabis sector.”) The folks at Airfield Supply were highly professional and seemed to know their stuff, which makes sense. This is, after all, a business, and the goal is to make a profit. Airfield Supply takes credit cards, which surprised me, but, again, their goal is to make a profit, and credit cards make for larger purchases.

          Dan bought oils to vape. One was “Afghan Elite” another was “Gorilla Glue.” His total before tax cost was $100.10. Taxes added $28.49 to the purchase, so various state government agencies collected 28% on Dan’s legal pot purchase.

          He also bought a package of ten small cookies “for me” (I have a well-known weakness for cookies). The cookies, “Big Pete’s Cannabis-Infused Chocolate Chip Mini Cookies,” are professionally packaged and even have a bar code—81156020633—if you saw them on a grocery store shelf, they’d look right at home. These cost $19, and the tax on that purchase, $6.32, was 33%. (Full disclosure, I ate 3½ cookies and not all at once; I think they did relax me, but that could well be psychosomatic.)

          California is making 28% to 33% on all pot purchases.

          If you consider the money California was spending on pot prohibition before pot was legalized, California is making a lot more than 28% to 33% on the deal.

Airfield Supply is just one dispensary. Dispensaries are just about everywhere (although some upscale and upscale wannabe neighborhoods prohibit them), and they advertise not only in the local Pitch-like papers, but also in the Los Angeles Daily News. (Newspapers have to take revenue where they can get it these days--while we were in California, the Daily News announced it would lay off half its staff.) Interestingly, medical marijuana dispensaries are urging their customers not to give up their cards, since a person who has a medical card can buy pot at age 18; recreational stores can only sell to those 21 and older.

          It’s a new world out there, and California has changed that new world from a liability into an asset.

          Perhaps the rest of the country should do the same.

           

© 2018 Larry Roth

Gigged: A Review of the Book by Sarah Kessler

          Sarah Kessler’s Gigged: The End of the Job and the Future of Work is another of those books examining the current jobs situation. Ms. Kessler, a reporter for Quartz, has been observing the “gig economy” since 2011, and her research for this book has included actually taking on gig tasks to see first-hand how the economy works.

          The 250-page book is a fast read. It took me less than a day.

          In the book she interviews several people, including an ethically flexible young man here in Kansas City who worked for and then sued Uber. Uber is one of the few gig jobs that has endured, but Uber keeps changing its terms, which has resulted in drivers’ not being able to make a profit. I’ve talked to a couple of Uber drivers because I couldn’t understand how they could be making any money. One quit after coming to the same conclusion; the other built up a client base and left Uber, taking his clients with him.

          Other examples include a woman who gigged for Mechanical Turk (and wound up with carpal tunnel syndrome and no health insurance), a man who left a high paid but boring job for Gigster, where he did quite well, but in the end, he opted for a job with benefits.

          One of the more interesting stories is about Managed by Q, an office cleaning company. It began as a gig company that contracted with other gig companies to get the cheapest labor available. It turned out Managed by Q got what they paid for and lost clients hand over fist. In the end Managed by Q became a company that hired—gasp!—employees and found that approach, plus treating their employees fairly, worked much better than racing to the bottom of the labor pool.

          While the jury is still out on the gig economy, Ms. Kessler seems to conclude it’s not the answer for people who actually need their gigs to earn them enough to live on, and that the race for the cheapest labor is usually not the best route for gig companies as well.

© 2018 Larry Roth

Bullshit Jobs: A Review of the Book by David Graeber

          I read a blurb about David Graeber’s Bullshit Jobs in the magazine In These Times. I read the book review sections in the Wall Street Journal and the New York Times, but so far I’ve not seen this book reviewed in either. Both are missing a good read.

          In the mid-1970s I had a job that required very little effort. The office was known to the outside world as a very busy one with a massive backlog. Every once in a while we’d be required to work overtime. In truth, there was no backlog. And when we had to work overtime it was not unusual to see anything but work being done. I remember once one of my coworkers gave another a haircut. Another guy sold insurance on “company time,” and no one cared. I once wondered if I could get a week’s worth of work done in a day. I could--with time left over. I’ve often wondered why I ever left such a cushy job.

          Dr. Graeber is an American anthropologist who teaches at the London School of Economics. This book grew out of a 2013 essay which went viral. Hundreds if not thousands of people wrote to tell about their bullshit jobs. As a result of his subsequent research, Graeber estimates that 40% of all jobs are bullshit jobs. If you think about it, his estimate may be conservative. How many jobs actually contribute to society? And Graeber points out the irony that how much jobs contribute to society is inversely proportional to the pay those who do those jobs receive. For example, teachers are paid far less than anyone in the finance industry. And yet we need teachers while the finance industry very nearly wrecked the world economy in 2008. Same with nurses, garbage collectors, bus drivers, and so on.

          He points out that when layoffs take place, it’s usually the hands-on people who are let go while administrative staff is added. And when it comes to education, well, Graeber is in that field and has seen the proliferation of many layers of administration, which brings with it additional reporting requirements to justify its existence.

          Graeber describes situations where people in bullshit jobs “share the wealth,” so to speak. In one case, government employees (in England) sent letters to pensioners that contained intentional errors designed to allow the pensioners to be billed for late payments. In another case, a French firm was hired by the British government to knock as many people as possible off disability rolls which resulted in more than two thousand people dying shortly after being found “fit to work.” In other cases forms for assistance are so purposefully confusing that 20% of the people who qualify for assistance simply give up. So we can see bullshit jobs are not necessarily harmless. In fact, one reason the U.S. does not yet have single-payer health insurance is Barack Obama did not favor it because even though we’d save money on insurance and paperwork, “[t]hat represents one million, two million, three million jobs [filled by] people who are working at Blue Cross Blue Shield or Kaiser or other places.”

          So we have our current health care system because we want the insurance industry to be a modern-day equivalent of the WPA.

         

          Graeber points out that John Maynard Keynes once predicted that by the end of the twentieth century, we’d have a fifteen-hour work week. Graeber says that’s actually possible if we eliminate the bullshit.

          As I was reading this book, I kept thinking this is an argument for a universal basic income, and, as it turns out, that is where the book goes. A universal basic income would replace several types of existing assistance programs, which would eliminate even more bullshit jobs taxpayers are currently paying for.

I wouldn’t expect to see it anytime soon, but if, indeed, a fifteen-hour work week is possible, we could have a lot fewer people on the roads during rush hour, which would lead to cleaner air, less use of oil, and probably a population with far less stress

          As I was finishing this review I saw on what passes for TV news these days that our president was in Wisconsin celebrating the groundbreaking of a Foxconn plant that will supposedly bring 13,000 jobs to Wisconsin, which is subsidizing the project to the tune of $4 billion, which means each job will cost the state more than $307,000. In his book, Raising the Floor, Andy Stern proposed a universal basic income of $12,000 a year. The subsidies for these 13,000 Foxconn jobs alone (many of which will be bullshit jobs) would be enough to pay $12,000 a year to 13,000 people for more than 25 years.

          Those who say we can’t afford a universal basic income seem to be quite willing to overlook how much it is costing taxpayers to “create” jobs.

© 2018 Larry Roth

Gore Vidal's "United States: Essays 1952-1992:" Still Relevant After All these Years

          I picked up a copy of Gore Vidal’s 1,271-page tome, United States: Essays 1952-1992, for a dollar at a recent estate sale. I figured I might find a few interesting essays, and I did.

          First, let’s note that this August is the fiftieth anniversary of the famous (or infamous) debates between Vidal (1925-2012) and William F. Buckley, Jr. (1925-2008) which culminated with Vidal calling Buckley a “crypto Nazi” and Buckley calling Vidal a queer and threatening to punch Vidal in his “Goddamned face.” And both of these men were World War II veterans. Ah, the joys of live broadcasting. By the way, this exchange is available on YouTube.

          I will have to confess here that I am a fan of both of these gentlemen. They were both highly intelligent and articulate, a combination not often seen these days, especially on television.

          I’ve read several of Vidal’s books including his historical series including Washington, D.C., Burr, 1876, Lincoln, Empire, Hollywood, and The Golden Age. I’ve often thought these books should be used to teach high schoolers history. True, there’s sex, but wouldn’t that appeal to teens more than the dry politically whitewashed pablum served in textbooks these days?

          What surprised me about this book is how relevant many of Vidal’s essays still are. For example, in a review of John Dos Passos’ 1961 book Mid-Century, Vidal says, of Dos Passos’ criticism of the youth, the labor movement, James Dean, and in general the civilization of the times as mistaking “the decline of his own flesh and talent for the world’s decline.” (Dos Passos would have been 65 at the time.) This brought to mind the books I recently discussed by Rod Dreher and Patrick J. Deneen, both of whom are in the “civilization today is going to hell in a handbasket” frame of mind.

          In a 1985 essay about Tennessee Williams, which morphs into a discussion of homosexuality, Vidal says, “In order for a ruling class to rule, there must be arbitrary prohibitions. Of all prohibitions, sexual taboo is the most useful because sex involves everyone. To be able to lock someone up or deprive him of employment because of his sex life is a very great power indeed… .” Indeed! And as we saw in Mr. Dreher’s book, in his world homosexuals can only get into heaven if they have no sex life.

          In a review of Robert A. Caro’s 1974 book, The Power Broker: Robert Moses and the Fall of New York, Vidal says, “The United States has always been a corrupt society. Periodically, ‘good’ citizens are presented to the public as non-politicians. Briefly things appear to be clean. But of course bribes are still given; taken. Nothing ever changes nor is there ever going to be any change until we summon up the courage to ask ourselves a simple if potentially dangerous question: Is the man who gives a bribe as guilty as the man who takes a bribe?” I guess we can ponder that one as we watch the latest corrupt limited vote on the rigged streetcar extension unfold.

          In a 1963 essay on Edmund Wilson (1895-1972), who discovered he was a tax dodger, Vidal says, “In public services we lag behind all the industrialized nations of the West, preferring that the public money go not to the people but to big business. The result is a unique society in which we have free enterprise for the poor and socialism for the rich. This dazzling inequity is reflected in our tax system where the man on salary pays more tax than the man who lives on dividends, who in turn pays more tax than the wheeler-dealer who makes a capital gains deal.” Warren Buffet has said the same thing for years, and this could have been written about who got financial assistance from the government in the recent crash (banks, not homeowners) as well as who benefitted most from the tax cut enacted last year.

          After finishing this book I felt so much better. It occurred to me we’ve been through the same old shit before. Many times. Between 1952 and 1992 we had the McCarthy era, Watergate, Iran-Contra, St. Ronald, the election of Slick Willy, and a whole host of characters and crises that threatened the Republic. And we’ve survived.

We can do it again.

© 2018 Larry Roth

Rethinking Lawns

                I’ve always had my doubts about lawns. My parents had a house built for them in the late 1950s. We moved into a house on bare red Oklahoma clay. My parents worked for years to turn that clay into a lawn. Eventually they had a beautiful Bermuda grass lawn that needed watering, mowing, and all the other chores that maintaining a lawn entail. Eventually, as my folks got older, they installed automatic sprinklers, which were high quality but, like the lawn, also required maintenance. I wondered what was the point of a lawn.

                When I moved back to Kansas City I had a guy mow my lawn. He had the equipment, and he was in and out of the yard in less than twenty minutes. Shortly after I moved into my current house I saw him toting a container of some sort to the back yard. I asked him what it was, and he said it was fertilizer. I said, “So you’re going to charge me to fertilize my lawn so it will grow faster and you can mow it more often?” I told him it was green enough. Nine years ago I fenced in the front yard and started a pollinator garden. Last year we decided to start another pollinator garden in the back yard with the hope getting rid of the grass. We’re getting there. Dan is managing the yard with a weed whacker, saving the weekly mowing costs. The yard is a hit with the neighbors, and more native/pollinator gardens are popping up in the neighborhood. We can’t claim credit for these, of course, but I think more people are questioning the effort and expense of lawns. And we’ve all heard of honeybee colony collapse disorder and the problems monarch butterflies are having finding milkweed, their only food source.

                So, think about the money you’re pouring into your lawn and consider whether you might like to keep more of it and have more time to spend on yourself or your family while doing something for the environment as well.

                It’s time to rethink lawns.

© 2018 Larry Roth

Rod Dreher's "The Benedict Option"

                In response to my review of Patrick Deneen’s Why Liberalism Failed, reader Sawbuck suggested I read Rod Dreher’s The Benedict Option. So I did.

                On the plus side, Mr. Dreher’s book is the more well written of the two, and he’s for the most part intellectually honest about history, including the negative aspects of Christianity after Constantine when the church was recognized as Rome’s official religion and the persecuted became the persecutors. He also, unlike Dr. Deneen, does not rely on dog whistles. The thing he most emphatically does not approve of is anything that allows LGBT people any rights, unless they abide by rules he believes will allow them to sneak into heaven (but they’ll probably have to be discreet there, too). Believe me, we’ll go into this later. He’s almost as opposed to public schools as he is to LGBT rights.

                The Benedict Option is named after a young man who, near the turn of the sixth century left his hometown for Rome and, seeing the vice there, moved first to a nearby forest and then to a cave for three years, after which he founded twelve monasteries.

                Rod Dreher sees parallels to Rome in today’s society. For his brand of Christians (small “o” orthodox Christians) he sees removing themselves from society as a viable means of preserving orthodox Christianity and possibly making it attractive to those turned off by other brands of Christianity.

                He doesn’t advocate moving to a forest or a cave, but he does advocate that the orthodox form churches and then communities in and around those churches. He recommends living within walking distance of the church and forming tightknit self-policing communities. (He tells how one couple was excommunicated for getting a divorce after being married more than forty years—I guess marriage is, indeed a life sentence in orthodoxy). The orthodox should secede culturally from the mainstream, turn off the television, put the smartphone away, read books, play games, make music, feast with your (presumably orthodox) neighbors, start a church (or a group within your church), open a classical Christian school, plant a garden, participate in a local farmer’s (sic) market, etc.

                He criticizes consumerism and materialism, and he won’t get any argument from me there. He believes things have been going downhill since the fourteenth century, which would make me wonder how the Benedict Option could possibly stop a movement that is more than six hundred years old.

                He discusses how until the sexual revolution every culture had its “thou shalt nots” that were needed to restrain individual passions and direct them to socially beneficial ends. I suspect that as DNA analysis and genealogy research become more widespread, people are going to discover just how much of a myth that statement is. My own genealogy research revealed a tremendous amount of hanky panky in my family, and the results I got from 23 and Me had a bit of a surprise as well. In the days before television there just wasn’t much going on in small towns, and the towns were small, so our ancestors didn’t have to walk too far to find privacy. To paraphrase one of my German lessons, in theory everyone was chaste, but in practice… .

                Even though Mr. Dreher moved around in his career (before returning to his hometown after his sister’s death), he is not in favor of mobility. Unlike so many religious conservatives, he’s no fan of Donald Trump, describing him as “not a solution to the problem of America’s cultural decline, but a symptom of it.”  

                He claims a “corrosive anti-Christian philosophy” has taken over American public life. I don’t buy this. I live across the street from a mainline Protestant church. I have never seen anything that would indicate anyone wishes that church or its worshippers anything but the best. As I’ve discussed in a previous post, I became a lapsed Unitarian because in part that church was implicitly (if not explicitly) anti-Christian, even though many Unitarian churches in other parts of the country remain Christian. Perhaps there is the odd person here and there who objects to being wished a “Merry Christmas,” but I dare say they are few and far between. Besides, Christmas has become so commercialized that its raison d’etre seems almost to be an afterthought.

                He has positive views (in my opinion) of work. Don’t let it become your life. He suggests rediscovering the trades, which I think is an excellent idea. We’ll always need plumbers, carpenters, etc., whereas a lot of white collar work can be and is being farmed out to the cheapest bidders overseas. He advises that the orthodox prepare to be poorer and more marginalized. I think he’ll find the former a tough sell, and I find the latter a symptom of paranoia. Mr. Dreher lives in Louisiana, for heaven’s sake. How anti-Christian is Louisiana, anyway?

                OK. Now we’re going to get to what seems to have set Mr. Dreher off. The Supreme Court’s decision in Obergefell v. Hodges, which legalized same-sex marriage in 2015. As I said, there are no dog whistles here. It’s more like a fire alarm.

                As I’ve said before, gay marriage was not a frivolous “Oooooh, we want to have a wedding” issue. The issue was financial. Over the years our government gave benefits to married couples that were not available to people who were not married while restricting who could marry. These include Social Security Survivor benefits, favorable treatment of inherited assets, a lower tax table, etc. At one time it was estimated there were 1,100 benefits available to those who were married that were not available to those who were not. In short, gay people were being required to subsidize married people. I would think any objective person would be able to see this is unfair, and the Supreme Court eventually decided it did, indeed violate that pesky Fourteenth Amendment.

                My solution would have been to eliminate all benefits married couples had that unmarried people did not. Had this been the solution the government followed, there would never have been a need for gay marriage (and I suspect the number of heterosexual marriages would have gone into a precipitous decline as well). The current system is an improvement, but single people of all persuasions are still left out of the loop.

                As for the “religious liberty” laws and forcing people to provide services that violate their religions, I agree with Mr. Dreher up to a point. As long as it does not involve employment or housing, I believe anyone should be able to refuse business. If someone does not want to bake you a cake, do your floral arrangement, cater your wedding, take your photographs, etc., for heavens sake, find someone who appreciates your business. Do you really want someone who hates you for who you are anywhere near your wedding or especially anywhere near your food? On the other hand, it's only fair that gays have the right to spread the word and advocate that such businesses be boycotted. Caveat venditor, in other words.

                Mr. Dreher says the church must own up to its past mistreatment of gays, but his solution for gays is a bit of a conundrum. First of all, in spite of the Supreme Court’s decision, in Mr. Dreher’s world, gay Christians cannot get married. “Gay Christians, like all unmarried Christians, are called to a life of chastity. This is a heavy cross to bear, but one that cannot in obedience be refused.” I would like to see his biblical reference for that rule, and I’d certainly be interested if he can find any examples of Jesus saying such a thing. I’ve listened to many of Bart Ehrman’s Great Courses and read some of his work. The Bible was put together in the first century, and much of it may or may not be authentic. But if you’re a gay person and willing to live by Mr. Dreher’s rules, he says there is a Spiritual Friendship movement for those caught in this celibacy quandary.

                My solution would be if you’re in an organization that won’t accept you as you are, find another organization. After all, isn’t that what Mr. Dreher is recommending for himself and his fellow believers?

© 2018 Larry Roth