Sunday, March 31, 2019

PRESS RELEASE!


PRESS RELEASE

April 1, 2019

I am hereby announcing I am running for mayor. I know I’m a little late in getting started, but what the heck? That’s why ballots have a place for write-ins, right? I’m going to share my platform as I and both of my supporters have developed it. Here’s what we have so far. Please feel free to make suggestions.

Most candidates will tell you they will represent you. And you seem to believe them. It’s the triumph of hope over experience that people keep voting for candidates that make such promises and deliver nothing to voters. It’s almost like owning GE stock. Or continually voting for sales and property tax increases hoping our city government will take care of basic services. C’mon. Remember what Ward Parkway was like until just last week? And if it takes an election to get the city to fix Ward Parkway, what makes you think we’re going to do anything in your neighborhood? This election and our incentive to perform will be over soon, and yet you keep electing the same kind of people no matter what we do. And you expect us to pretend we care? Here’s what I promise.

First. I will vote for any and all tax incentives. I don’t need to know the details or whether they make sense. All I know is throwing money at development is a way to make this city great again. Just ask most of our council members. $17 mil for a parking garage for a luxury apartment building? Piece of cake. We gotta keep that momentous momentum momenting.

Being your mayor pays about $130,000 a year. C’mon. Do you really expect anyone to represent you for that kind of money? Especially if they have a spouse and children that like to eat more than rice and beans and shop anywhere but garage sales? If that’s all you’re willing to pay, well, you get what you pay for. I plan to take any and all income enhancements that are offered by developers, lobbyists, and especially Burns and Mac, and I mention them only because I had the most obnoxious interview there I’ve ever experienced. I hope Burns and Mac got wise and fired that little prick. By the way, if you take me to lunch, I eat low carb, and I’ll want enough leftovers to take some home to my dog.

Second. The streetcar has contributed so much to this community since it first began running its two-mile route. Oh, it has its problems in ice, snow, heavy rains, and so on, but how often do we have these problems? Soon, global warming will eliminate snow and ice in our area anyway.

Since the streetcar has been such a success and is so reliable, I favor extending it not only to the Plaza but also to Wichita, Topeka, Oklahoma City, and New York. 24 million tourists can’t be wrong. I also plan to go on as many foreign and domestic junkets to discover the wonders of streetcars and other forms of, ummmm, entertainment in other cities and countries as possible. While I might be willing to fly coach to such reasonably close destinations as Tulsa or Oklahoma City, I’ll require first class seating for anything further away in this country and at least business class to foreign destinations. After all, you don’t want me—your mayor--exiting the plane looking rumpled—or even worse, sober—after an overseas trip, do you?

Third. I will require that Kansas City residents clear streets of snow and fill potholes on their own streets. People are always calling in and complaining about snow and potholes. Well, let them discover just what a hassle it is to plow those streets and fill those potholes. The city will provide them with sources for snow shovels and asphalt and assess penalties for noncompliance. This will stop people complaining about snow and potholes and free up funds for the things that really matter, like luxury apartment buildings, fixed rail fair weather only transit, and hotels—heaven knows you can never be too rich, too thin (no offense to any of my opponents) or have too many hotels--which is where our priorities should be focused. Snow, schmow. Potholes, schmotholes. We’re big picture people, people.

Fourth. Gentrification is a good thing. As property values increase on paper, the city can raise property taxes and generate more revenue for tax incentive programs. If we’re going to provide multi-decade tax abatements, we have to make up the lost revenue somehow, and that somehow is you. If you’re elderly and have problems paying these increased taxes, well, too bad. The young people moving in and gentrifying older neighborhoods don’t want to live around poor people, anyway. Here is an actual quote from one of the millennials we have coaxed downtown to live in taxpayer-subsidized luxury: Who gives a damn. I work hard for my money, and I can afford to live [downtown]. I am not going to apologize for yearsnofnhard (sic) work, smart life choices and good decisions. I choose to live downtown because I can. People who work hard and make good life divisions (sic) shouldn’t be forced to now live with those that can’t keep their shit together.” As you can see, people who move downtown may say they want to live in a diverse area, but by that they don’t mean they want to live around or come into contact with diverse people. If they wanted to be around diverse people, they’d use the bus instead of lobbying for the streetcar.

Fifth. I promise to set up several committees on crime. Perhaps at least one of the committees can come up with some reasonable sounding approach to the problem. Perhaps we could soften the effect of crime by using euphemisms. If bribes can be referred to as income enhancement, why shouldn’t we refer to murder as premature passing?

My very first order of business will be to erect a statue in honor of former mayor Kay Waldo Barnes, Kansas City’s Madonna of tax incentives. This statue will go up in the Power and Light District and have an eternal flame to commemorate Kansas City’s eternal $14 million per year commitment to the Cordish Company. Did that woman know tax incentives or what?

So it’s up to you. If you want a mayor who is going to promise you neighborhood representation only to desert you once the first tax incentive proposal (with incentives going to you know who) passes over his or her desk or under his or her table at the Capital Grille and leave you with a bitter taste in your mouth as you swear never to vote for that person again only to be faced with yet another such candidate in another four years, then do as you always do, sucker. If, on the other hand, you want a mayor who tells you in advance he’s a crook and doesn’t give a hoot about neighborhoods, I’m your man. You know what you’re getting, and I promise never to disappoint you.

Go to the polls tomorrow and write me in for mayor. You will never have to lower your expectations again.

© 2019 Larry Roth

Wednesday, January 23, 2019

A Review of Antonia Felix's "Elizabeth Warren: Her Fight. Her Work. Her Life."


                I happened on Antonia Felix’s Elizabeth Warren: Her Fight. Her Work. Her Life. at the library, and I couldn’t resist. I checked it out, and I suggest you do the same.

                Before I go further, I have to come clean. Because of an accident of geography, I went to Northwest Classen High School in Oklahoma City and was in the same graduating class as Ms. Warren. The answers to questions people ask when they learn that are (1) Yes, I knew her, but not well (there were about 800 people in our class and about 3,200 people in our school), (2) Yes, we were in some of the same classes, and (3) If I called her, she would not only not remember me, she’d ask how the hell I got her phone number and would I please lose it. With that out of the way, let’s go on to the book.

                Ms. Felix starts with Ms. Warren’s childhood and teen years, which were difficult. Her parents were living close to the edge when her father had a heart attack, which caused a sudden drop in family income that claimed one car and threatened to claim their home. Her mother, who had never worked outside the home, took a minimum wage job at Sears, and Ms. Warren babysat, took in ironing, and sewed to add to the family income. Together they saved the house. When it came time for Ms. Warren to graduate from high school, her mother opposed her going on to college.
                Ms. Warren went to school and then dropped out to marry a man who had been two years ahead of her at Northwest Classen. Eventually Ms. Warren completed her undergraduate degree and went on to law school. While in law school she began researching bankruptcy, believing only deadbeats took advantage of bankruptcy laws to wiggle out of their debts. Her research did not confirm her bias, so she started digging further and decided not only were bankruptcy laws not being abused, they were offering a tenuous safety net increasingly to the middle class, most of whom had encountered job losses, medical emergencies, and other hardships that swallowed their finances. Added to that were laws that protected predatory lending practices, from payday loans to confusing credit card contracts and mortgages. One finding was that people who took out mortgages were frequently offered worse terms than they were entitled to, for example, subprime loans when they qualified for prime loans.

                She began her campaign for a consumer protection bureau pointing out that people buying toasters were more protected than people taking out loans. Eventually the events of the last crash led to the creation of the Consumer Financial Protection Bureau (CFPB). The powers that be in Congress made it clear they would not approve Ms. Warren to head that bureau, which is what she really wanted, and which she would probably have happily made her career. I remember thinking at the time those Congress people who blocked her appointment are going to regret that decision, and sure enough, the next thing you know, she’s in the Senate. Payback is a bitch.

                Ms. Felix addresses the “Pocahontas” issue, and I’m going to add my own two cents here. When we went to high school, Oklahoma had only been a state for 55 years. Before Oklahoma became a state it was Indian Territory. When we were in high school there were many people still alive who came to Oklahoma as children in the land runs that began in 1889. Oklahoma was then a young state with an Indian heritage. Many, if not most, or our classmates claimed to be “part Indian.” Evidently Ms. Warren’s mother believed she was “part Indian,” as did most of the people in the small town of Wetumka, Oklahoma, where she and her future husband grew up. This was such a common belief that Ms. Warren’s father’s family forbade the marriage and had little to do with either their son or their daughter-in-law for the rest of their lives. Is it any surprise that Ms. Warren believed she, too, was “part Indian?” She was, after all, cut off from her grandparents because they believed she was “part Indian.” According to Ms. Felix, Ms. Warren never received any preference or any jobs because of her supposed heritage. Her mistake was an honest one, unlike the president’s claim to have been of Swedish descent because his father didn’t want it known that the family was actually of German descent.
                I think Ms. Felix goes a little overboard on the “Pocahontas” issue, quoting Professor David Wilkins of the University of Minnesota as saying, “But Native academics and many others outside of politics, being focused on other dimensions, want to know where she’s been all these years and want to know how someone can claim to be ‘part’ Native. You’re either Native or you’re not, from our perspective.” I’d like to know who designated Professor Wilkins the arbiter of who is and is not Native, 100% or otherwise.

                Now that I’ve got that out of my system, the book details Ms. Warren’s accomplishments, moving from school to school and winding up a professor at Harvard. Not bad for a poor girl from Oklahoma. From Harvard, she went to form the CFPB, and then to the Senate. And she just announced she’s going to run for president in 2020. Given how far she’s gone, I wouldn’t be surprised if she makes it.
                Just consider the comparison between her and the president. Truly a self-made woman versus a celebrity claiming to be a self-made billionaire with the help of many millions from his father. A woman who has stood up for consumers and the middle class and studied bankruptcy law versus a man possibly most well known for not paying his vendors and declaring bankruptcy six times. A woman who is one of us versus a man who says he’s one of us while picking our pockets. The comparisons go on.

                Believe me, I can imagine the response this post will get. I was at the 50-year reunion of our class a couple of years ago, and the vitriol spewed at Ms. Warren, who did not attend—she was endorsing Hillary Clinton that night—was amazing. How dare someone who was—gasp!—poor and not one of the super in crowd dare to rise so far above her station? By the way, some of the things Ms. Felix says about Northwest Classen, circa 1960s, are true—we were called “Silkies” because supposedly we wore silk underwear, which, of course we didn’t, and a few of the people in our school came from families that were comfortable, but many more came from families who were putting on the dog; my own family didn’t see the point in putting on the dog. My mother once told me not to worry too much about the popular kids, since, once I graduated, I’d never hear anything about them again. And for the most part, that’s been the case.
                But old habits die hard. The super elites still have an event the day before our reunions. (And no, I’ve never been invited, which shows you where I stand!) I would imagine Ms. Warren’s declaring she’s going to run for president may have caused a few medical emergencies among our classmates; I would also imagine if she wins, the carnage will save the Social Security system a few bucks in Oklahoma.

                I am going to be taking a breather from my blog for a while. Classes at our local university have started up again, and the papers I do for my class take up a lot of time. Have a great spring!

©2019 Larry Roth

A Promise (Finally) Fulfilled: My 2000 Simplicity Speech


                In early 2000 I was invited to speak at a simplicity conference in Santa Clara, California. I felt honored, since the other speakers included Vicki Robin, Duane Elgin (author of Voluntary Simplicity), Cecile Andrews (author of The Circle of Simplicity), and a host of others in what was at the time termed the “New Frugality” and simplicity movements.
                At the end of my speech I promised to publish the speech “somewhere.” And when I got home I put the speech in my “sometime” file and forgot about it until I came across it while looking for something else. I am now fulfilling my promise.

MY SPEECH
                I’m Larry Roth, and I too once had a high-stress life right here in Silicon Valley. In February 1995, just a little more than five years ago, I left my job, I left Silicon Valley, and I left California. I was 46 years old. And I have not once in the past five years awakened in the morning and said, “Gee! I wish I were going to work at Company L today.”

                In 1916 Robert Frost wrote about the road less traveled by. These days frugality is definitely that road. What I’d like to throw out to you are first some money saving tips and then a few ideas that may make traveling this road easier.

1.       Never buy new if used will do. Quite often you can find a used item for ten percent of the cost of a new item. Buying recycled items is also kind to the environment.
2.       Know the true value of your hard-earned dollars. So you’re making $50,000 a year. Really? After taxes, your fifty grand is more likely to be around $30,000. Both Your Money or Your Life and my Beating the System, both of which you can get at the library, have formulas in them for calculating how much you have to earn to have a dollar to spend.
3.       Don’t suffer from taxophobia. Remember a tax deduction is not a rebate. If you are in the 28% bracket, you must spend $1.00 for every 28¢ you save in taxes. If you think this is a good deal, send me $100. I’ll send you $28. What the heck. I’ll send you $29.
4.       Remember little things add up. If you can use a postcard instead of a letter, you’ll save 13¢. Do that three times, and you’ve saved more than the price of mailing one first class letter.
5.       If you have time, shop garage sales and auctions. If you don’t have time, shop thrift, resale, and consignment stores. You’ll be amazed at how much you can save, and pretty soon you’ll consider paying retail prices for new goods a ridiculous waste of money. A few years ago I was asked to be part of a “cheap-off” for a major network. The contest winner would be the person who could buy the most back-to-school clothes. For the filming we needed a child, and since I don’t have any, we borrowed the producer’s niece. We filmed the segment is a consignment store in San Jose. The mother of the child, who lived in a decidedly upscale Peninsula suburb, was clearly miffed at having to be in such a place. We were able to find a lot of clothes at excellent prices, and for $88 the child was outfitted for school. After we were finished filming, the camera crew began looking around, and they found some things for their children. The mother, who had initially been so upset about having to be in a second-hand store, was so impressed with the prices and selection that she and the producer were still shopping when I left. I won the cheap-off, by the way.
6.       Our country is so rich that people often throw perfectly good items out. Take advantage of this bounty. If you see something you can use on the curb on garbage day, grab it. I have a 1928 American Standard pedestal sink in my bathroom that I rescued from the trash collectors. The downside of this is there is so much stuff to be had for free that you simply must limit what you take to what you actually need and hope the rest finds itself to someone else who can use it.
7.       If you work for a company that has a newsletter that lets employees advertise items for sale, use it to buy and sell.
8.       Make your newspaper pay for itself. Clip coupons. Look for items you need in the classified ads. And shop grocery stores and sale brochures (but only for items you need).
9.       Practice guerilla shopping. Combine coupons (or double coupons if possible) with store “loss leaders.” I have bought Hamburger Helper for as little as 19¢, though it usually costs me about 70¢. (I would never buy it at the regular price of $1.79.) I’ve actually got money back on some items.
10.   Stock up when things are on sale. I might spend $50 on groceries one week and nothing for a couple of weeks, depending on what’s on sale.
11.   Buy store brands and generic products. In 1988 there was an e-coli contamination at a Malt-O-Meal factory. As a result, the public learned that the same cereal sold as Malt-O-Meal was sold under more than fifty names in more than thirty stores. Juliet B. Schor in her book The Overspent American states that brand name drugs are often the same as generics, that many vitamins are made by one country and sold under different brands, and that a “worldwide manufacturer” sells essentially the same jeans to Walmart, Penney’s, and Calvin Klein. Learn to ignore the labels. Let choosy mothers overpay for Jif. Peanut butter is peanut butter.
12.   Following up on number 11, even if there is a slight difference in quality, so what? Will you be savoring the taste of your last peanut butter sandwich a week from now? An hour from now? Ten minutes from now? I admit to liking Reese’s peanut butter best. But will I pay $2.29 for it when I can buy a store brand for 99¢ to $1.19? No way.
13.   Beware of wholesale shopping clubs. We all normally assume that if we buy in massive quantities, our per unit price is less. Sometimes this is true. Sometimes it isn’t. Check the per unit prices at your neighborhood stores (where you can use coupons) as well as Sam’s and Costco (which don’t accept coupons).
14.   Thinking for yourself is the most profitable do-it-yourself project. Only you know what is best for you and how to make what you want happen.
15.   Live your life as you see fit. If you are over the age of consent, you do not have to listen to people, be they friends, relatives, or “talking heads” about what you “should” do. It has always amazed me that the most unhappy people seem to make it their business to live other people’s lives. And it amazes me even more that other people try to please these unhappy folks. Be yourself. Be happy.
16.   Take advantage of the internet. There are all sorts of opportunities to save money. Looking for a book? Well, Amazon.com and BarnesandNoble.com have good prices, but the book you’re looking for might be available cheaper at a used book store you can access through bookfinder.com.
17.   Buy permanent press clothing when possible. Why pay for dry cleaning when you don’t have to?
18.   Look to the internet for cheap phone rates. AOL offers long distance for 9¢ a minute (and a calling card that tacks on a mere 30¢ to the 9¢ rate). Other ISPs may follow AOL’s lead.

Now a few tips for making your life easier.

                First, whether it be religion, a new diet, or, yes, frugality, recent converts tend to become enthusiastic, convinced their way is the only way and that their job is now to get others to see the errors of their ways and accept the new religion, diet, or whatever. This is not a new phenomenon. Ralph Waldo Emerson wrote about it in his 1844 essay New England Reformers. As you might imagine, I have had many people, some of them perfect strangers, walk up to me and suggest a diet I might want to try. One recent suggestion came from a young man who recommended I buy a daily waffle breakfast at McDonald’s, forgo the butter and syrup, and wash it down with a diet soda so it would “expand” and fill me up. First, I don’t like either McDonald’s or waffles, and second I’m just not up to drinking soda in the morning. So even though this diet may have worked for this young man, and he swears it did, I’m afraid it’s just not for me. Similarly, we must accept that frugality will have the same appeal to many people that the diet of waffles and soda had to me. And we must get over our belief that frugality is something the world needs to embrace (though I think the world would be a better place if the government did embrace frugality). I believe we can lead simpler and happier lives by accepting that frugality is the path for us. And I believe we can be more effective by showing the world what frugality can do for us than trying to convince the world we are right. If you would like to understand why people don’t understand the world our way, I suggest that you study any of the books on the Enneagram by Helen Palmer or Don Riso.
                Once you are financially independent, you will find it takes a year or so to adapt to your new, slower lifestyle. During that time you will undoubtedly explore several options. I first worked with an animal rescue group, but I found the leader of that group devious and more than willing to take over my life (though I did wind up with a pretty good dog out of the deal). I then worked with AARP’s tax assistance program, and I really enjoyed that. I suggest you avoid fanatics and their causes whenever possible. Remember that you are simplifying your life. You are gaining control of your time. These people will be more than happy to their agenda for former bosses’ agenda. You’ll have your old schedule back, and the pay will be lousy!
                Don’t give in to the “shoulds.” Don’t do things or get involved with causes because you think you should. Remember the reason you became financially independent was so you could do what you want. When in doubt about getting involved (and if you’re in doubt, you may well at least subconsciously not want to get involved), ask yourself, “Is this something I really want to do?”
                Remember that your time and energy are resources, as is your money, and you will not want to waste any of your resources.
                Avoid negative people. Now, I’m not saying turn your back on your friends in times of need, but if you have someone in your life who insists on seeing the world through shit-colored glasses and who leaves you tired after every visit, get that person out of your life. You’ve got a tough enough row to hoe without having these energy sinks around you.
                These are the kinds of people who complain about the things many of us feel make life beautiful. These are the kinds of people who will, for example, complain about church bells, Christmas carols, and so on. These people can take something beautiful and not only make it ugly but try to make you feel guilty for having enjoyed the beauty. And speaking of beauty, I’m not particularly religious, but Christmas is just about my favorite time of the year.
                Did anyone here overdo it financially this past Christmas? Well, now is a good time for you to start working on a simpler and more enjoyable Christmas for yourselves. There’s plenty of time to alert your friends and family that you’re not going to engage in the gift wars again this year and ask them to honor your gift truce. If they don’t, well, a gift is a gift. It doesn’t have to be an obligation. Only you can be dragged into the fray.
                Don’t let any book become your bible or any writer become your prophet. Remember all we can tell you is what worked for us. I can truthfully say that two books changed my life. The first was Paul Terhorst’s Cashing in on the American Dream, which was published in 1988. I didn’t agree with Paul’s recommendations that you don’t own a home and that you buy short-term CDs, so I ignored that part of the book. Likewise, Joe Dominguez’s and Vicki Robin’s Your Money or Your Life gave me a concrete path to financial independence and, most important, the means to know when I was there. I didn’t agree with their recommendation that I invest solely in U. S. Treasuries of that I never work for money again once I was financially independent, so I rejected that advice. And lived. Read our advice, but think for yourself. We don’t live in a one-size-fits-all world.
                Next, get over past mistakes. Stop beating yourself up for having wasted money, time, or energy in the past. Remember that what seem like mistakes to us are sometimes happy accidents of the universe. If there’s something in your past you’re letting weigh you down, let go of it. To give your regrets some perspective, consider John Greenleaf Whittier’s poem Maud Muller. In this poem a wealthy judge out riding one hot summer day is given a drink of cool water by a poor farm woman, Maud Muller. As a result of that one chance meeting, the judge spends the rest of his life fantasizing about being Maud’s husband and a poor farmer. Maud, meanwhile, spent the rest of her life fantasizing about being the wife of a rich judge. In other words, if the fantasy romance had come to fruition, neither party would have been happy. Whittier concluded:

For of all sad words of tongue or pen,
The saddest are these: “It might have been.”

                Know when to repair and when to replace. Alexander Pope said way back in the 18th Century, “Be not the first by whom the new are tried, nor yet the last to cast the old aside.” In 1984 I bought a VCR that cost more than $400. I kept repairing it because the repair people said, “They don’t make them like that anymore.” The last repair cost $80 and lasted four months. I saw an ad for a new VCR for $69. The new VCR programmed itself, it’s smaller and lighter and fits on top of the TV. The repair people were right. They don’t make them like they did in 1984. They make them better and cheaper.
                Don’t do your living in the future. I don’t believe we were put here to live lives of drudgery, either by staying forever in oppressive jobs or engaging in extreme self-denial. There is a happy medium. Find yours.
                Beware of causes du jour. Many of these have backing from people and organizations that stand to make money from legislative action. Rodale Press’ Guide to Organic Foods Shopping and Organic Living quoted a study in 1970 that said, “In 10 to 15 years from now every man, woman, and child in the hemisphere will have to wear a breathing helmet to survive outdoors.” Thirty years later, that statement looks pretty silly as will most of the prophecies of doom being stated as fact today. (Take the Y2K hoopla, for example.)
                Along those same lines, don’t be so quick to condemn our era’s contributions to society. A few weeks ago I needed some underwear. I went to the Penney’s outlet store where I do a lot of my clothes shopping. (There are some things even I won’t buy used.) The place was disorganized, and, when I finally found the underwear, I thought it cost too much ($8 for three pair). There’s a Walmart a block away, so I decided to see what they had. Well, first, they had a person at the door who told me exactly where in the store to find underwear, and then they had a package of seven pair of Fruit of the Loom briefs for $5.96. As big and ruthless as these places are supposed to be, they certainly provide value, and they respect their customers’ time. No wonder they are doing well. That same day I visited the former site of a Venture store. Venture was a chain of stores I found particularly annoying. Not only did they not have any qualms about advertising things they didn’t have in stock, they’d actually blame you for not dropping what you were doing and running to their store when they had sale items. I can’t remember how many times their customer service people said, “We had plenty of those last Sunday.” Venture eventually made so many people mad they wouldn’t go there if they were giving stuff away, and Venture went broke. Home Depot bought the site of the Venture store I used to have so much fun at, and they just had their grand opening. I know a lot of people who are into simplicity have problems with stores like Home Depot and Walmart, and I say let that be their problem. To me, any time I can make one trip to one store instead of several trips to several stores, I’m saving time and fuel, and I’m a happy camper.
                The only argument I’ve heard against these monster stores is they’re bad for the indigenous businesses. First, let me point out that existing businesses did not come with Adam and Eve. They replaced something else. Nothing is permanent. And second, some of these indigenous businesses deserve to be replaced. My neighborhood recently lost a natural foods store and a book store. I did not do mush business with the book store because it always impressed me as a very unfriendly place, but I did have a friend who tried to do business with the natural foods store. She wanted a brand of soy milk the store already carried in a flavor they did not carry. The store told her she’d have to order 24 containers. She did and gave them her contact information. They said they’d call when her order came in. In 1945, when cars were in short supply, my father ordered a 1946 Buick. Both he and my friend are still waiting for their orders to be filled. My friend, by the way, found what she wanted at Wild Oats, and they even give a discount for buying a full case. Just because some business has been providing bad service forever does not mean it deserves eternal life.
                Learn to say no. Use this powerful two-letter word when you’re feeling overburdened. If you’re asked to do extra work, be on a committee, etc., and you can get away with it, say no if you feel like it. Limit your activities to those you enjoy or truly believe in. There are other people in the world, and only you can take care of you.
                Listen to your body. If your body says it’s tired, or hungry, take care of it. It’s the only one you get.
                Learn to slow down. While sloth is generally considered a vice, being constantly busy is not necessarily a virtue. Busy-ness is often used to avoid self-examination.
                Don’t save things you won’t use. Learn to use the garbage can or to recycle. I bought a rental house from a woman who had saved hundreds if not thousands of those Styrofoam trays you get when you buy meat at the supermarket. I would advise setting a reasonable limit on accumulating things such as margarine tubs, cottage cheese containers, etc. To me, if you have, say, ten of these things, it’s time to stop. You have nothing to gain by accumulating number 11.
                Decide what you want, what your objective is. In my case I wanted an income that would enable me to live without a job. Your objective could be to live on one income, to afford a larger home, etc. Very few people, I believe, have frugality in mind as an end. It is, rather, the means to an end. As an aside here, I find it empowering to know that I can live without something society as a whole believes is a necessity, such as cell phones, electric can openers, etc., and I love finding things I can use at garage sales, estate sales, thrift shops, etc.

                We are living in truly amazing economic times. Both unemployment and interest rates are low. Many consumer goods, especially computers and electronics, cost much less than they did just a few years ago. When I think about the inflation and malaise of just twenty years ago, today’s economy boggles my mind. Will it last? The honest answer is no one knows, but I can tell you much of Europe considers our economy to be a bubble similar to the one Japan went through a few years ago. And even some surprising sources are waving the caution flag. The Wall Street Journal had two articles in fifteen days that discussed how previous booms have ended and how this one might end. Whether the economy holds or folds, though, I suggest we all consider these times an opportunity to feather our nests. If the economy fails, we’ll have some money in the bank. If it continues to soar, well, we’re just that much better off and just that much closer to our goals. Being frugal in good times, in other words, is a no-lose proposition.

                Finally, the question I personally have been asked most often is, “What did you do about health care?” And I want to address that issue here. I was extremely fortunate in that I had Kaiser Permanente, and I was able to convert my group plan here to an individual plan in Kansas City. The bad news is my monthly rates have gone from $126 to $285 in five years. Health care is a problem for people who do not have employers, and I cannot help but believe this one issue keeps more people in their jobs than any other issue. There are possibilities out there, one of which is “Simplecare,” a plan that is taking root in Seattle, wherein people pay cash for most health care and carry catastrophic insurance for major medical problems. But will Simplecare spread to other markets? I don’t know.

                There is talk about simplicity becoming a “movement” in the political and social sense, and I personally have some issues with that, since a movement implies leaders, followers, and a certain degree of groupthink, but if we could form a movement on a practical level that would result in our being able to obtain group rate health insurance for those tied to their jobs because they could not get affordable health insurance elsewhere, I believe that would be the most immediately productive project we could tackle, and it would result financial independence becoming a possibility for many more people. Affordable group rate health care, in other words, would expand the movement.

                A lot of water has gone under the bridge in the past nineteen years. It turned out the Wall Street Journal was spot-on. The dot.com boom burst shortly after this speech. They’ve been flashing a few caution signals lately. Long-distance telephone rates are no longer an issue for most people, VCRs were replaced by DVDs, and DVDs are being replaced by streaming. Wild Oats was taken over by Whole Foods. I lost a great deal of weight a couple of years after this speech and have (knock on wood) been able to keep it off, so I’m no longer approached by strangers offering diets. I no longer buy Hamburger Helper. Newspapers are going the way of VHSs, so coupons are getting scarcer, and classified ads are few and far between, but now there’s Craigslist. Kaiser Permanente deserted the Kansas City market, and those of us with individual plans were on our own. I wound up with Blue Cross, and I still have my Medicare supplemental insurance with them. I’m sure you’ll be able to find some other anachronisms. For any errors I made in this speech, I’m going to follow my own advice and get over past mistakes.
 
©2019 Larry Roth

Wednesday, January 2, 2019

In Time for Your New Years Resolutions: A Review of Playing with FIRE, Scott Rieckens' New Book on Financial Independence


                My last post dealt with Suze Orman’s ludicrous criticism of the FIRE (Financial Independence Retire Early) movement. While I was doing research for that post, I discovered a book was soon to be published on FIRE.
                I requested and received a review copy of that book, Scott Rieckens’ Playing with FIRE: How Far Would You Go for Financial Freedom?, which will be hitting book stores in a couple of weeks. The book retails for $16.95, but Amazon is taking preorders for $11.56. I’m going to buy a few to give to some of my family. That’s how much I (to put it in terms Suze Orman would understand) liked, liked, liked, liked this book.

              Yes, FIRE stands for Financial Independence Retire Early. Now, before you get all nasty about retiring early, as in retiring to sit on the beach, or as Suze Orman said about FIRE, sit around watching TV and doing nothing, the FIRE version of retire is—you get to do what you want. If you want to, as Suze suggests, work in a corporate job until you’re 70, when you can collect your maximum Social Security benefits, that’s great (although, remember Suze also says that Social Security won’t be around in 2030). Just because you CAN retire does not mean you MUST retire. You’re simply giving yourself an option you would not otherwise have without following the FIRE program. In my own case, as I’ve mentioned before, with the help of Paul Terhorst’s Cashing in on the American Dream and Joe Dominguez’s and Vicki Robin’s Your Money of Your Life, I realized early retirement could be enjoyable and that it was possible. I never thought I’d pull the plug, but new management took over at Company L, and we had a disagreement over work-life balance. I thought there should be one. I made the decision to leave 25 years ago, and I finally got everything together and said goodbye to my old life in February, 1995.

                So I’ve been retired from corporate life and office politics for nearly a quarter century. Time has flown. I’m thinking of doing a 25-year anniversary revised edition of Beating the System if I can find the time. It might be interesting to share the mistakes I made and lessons learned as well as how my views have changed over the past quarter century.

                At any rate, having lived the FIRE lifestyle for so long, I was grateful that Scott Rieckens has taken the time to pull this book together. He has also put a documentary with the same title together, and it will be opening in select venues very shortly. I would imagine if it is not opening where you live, it will be on Kanopy, the library free streaming service, soon.
                OK. To the book. Mr. Rieckens and his wife, Taylor, were living what they thought was the California dream life in Coronado, California, a suburb of San Diego. Together they earned, after taxes, $142,000 a year, of which they spent $132,000. The Rieckens married in 2010 and in 2015 had a child. Taylor decided to work from home in order to spend time with their daughter. They had bought a bunch of stuff for their daughter’s birth, and, it seems, every new interest the Rieckens found involved purchases. They leased two cars, had a boat club membership (I’ll say this, though, that boat club membership at $350 a month was a lot cheaper than owning a boat), and everything they wanted. Every material thing, that is. Scott was feeling drained by his job when he heard Pete Adeney (Mr. Money Moustache) on a podcast. Adeney said he and his family lived comfortably on $24,000 to $27,000 per year. That was in February 2017. Scott started investigating the FIRE movement and grew more intrigued. He began forwarding blog posts and articles to Taylor, who eventually came around largely as the result of an exercise that asks what are the ten things that mean the most to you. Not one of either Scott’s or Taylor’s list included a lot of material stuff. They decided to take action and began by getting rid of their surplus stuff. Scott recommends starting small—not eating out, making your own coffee instead of going to Starbucks, and bringing your lunch to work. In Scott’s case, bringing his lunch resulted in his coworkers suggesting other ways to save money. Once Scott started sharing his FIRE discoveries, he found a great many people were already living the FIRE lifestyle.

                Scott makes the observation about living in California that played a big part in my decision to leave: he says he and Taylor planned to spend lots of time on the water—surfing, paddleboarding, kayaking, and swimming—but that didn’t happen. They were working so much they never had time to do any of those things (though they had bought paddleboards, kayaks, etc.). When Scott gives up his much loved $350 per month boat club membership, he lost a one-time $6,000 initial membership fee. He takes that opportunity to discuss the “sunk cost” fallacy, or the tendency of people to hold on to things that become useless because of the money we’ve already spent on them. (Ask anyone who’s bought exercise equipment or held on to GE stock through good, bad, and empty backup plane trips.) He advises we forget about the money spent, take our losses, and move on.
                Then he gets into the nitty gritty of FIRE. It involves saving as much as you can—he and Taylor went from virtually no savings to saving 54% of their income. He convinced Taylor to get rid of her BMW lease by showing her that by doing so, their savings rate would increase to 58%, and they’d reach FI in 11 years instead of 12.5 years with the BMW. Taylor decided the beloved BMW was not worth an additional 1½ years of her life.

                There are several examples of formulas that will tell you how soon you can retire if you get with the program. The basics are: Spend well below your income and invest the difference. FIRE enthusiasts recommend Vanguard’s VTSMX funds for those with at least $3,000 to invest and the VTSAX fund for those with at least $10,000 to invest. VTSMX investments will automatically become VTSAX funds when they reach $10,000. A word of caution here—I don’t have a clue about these funds. Most of my investments have been in bonds. When I rolled my 401(k) over to an IRA, I bought zero coupon bonds. This has worked out well for me, but I’m certainly open to exploring the funds the FIRE enthusiasts recommend. For further reading on the subject, Scott recommends JL Collins’ The Simple Path to Wealth. I haven’t read it, but I will.
                The book discusses buying a car. Among the recommendations are buy what you need (which probably won’t be a turbocharged car), try to find a good used car for less than $5,000, and pay cash. I’m going to advise you to be flexible here. The car I owned before I bought my Kia was (I thought) a $4,200 bargain. It had low miles, had been owned by a little old lady who had only driven it to the beauty parlor, and it turned out to be not only the most expensive car I’ve ever owned, but the car that convinced me never to buy another General Motors product for as long as I live. (And I come from a family that rarely bought anything that wasn’t GM.) I drive between 2,000 and 3,000 miles per year, and that car easily cost $2,000 a year to keep running. When the brakes failed the SECOND time, I decided enough was enough. I had the brakes fixed and drove the car to a Kia dealership fully expecting to write a check for a new car. When I didn’t bother filling out the credit application because I was going to pay cash, the salesman told me I really didn’t want to do that, since if I financed the car with Kia, they’d knock $1,000 off the price of the car. I asked how long I had to keep the car financed, and he said three months, and I could pay one-third of the principal for each of those three months. The interest rate was 5%. The sales tax in Missouri is 8%, so I saved $80 on the sales tax and wound up paying three months’ interest at 5% (probably about $35). The car cost $16,000—the only option I bought was an automatic transmission, and that was nearly five years ago. I’ve had the car serviced every nine months, and so far that’s been my only expense. Given that I was paying at least $2,000 a year to keep my previous car running, I figure this car has saved me $10,000 so far, and if that continues another three years, the car will have been free. So, I’d diverge from the FIRE folk here and advise you to keep your options open and think long-term when it comes to cars.

                Scott and Taylor decided to leave California for a more affordable area. They narrowed their list to Bend, Oregon, Fort Collins, Colorado, Boise, Idaho, and Spokane, Washington. They fell in love with Bend and decided to settle there. They fell in love with a midcentury home and offered the $480,000 asking price. Alas, and possibly for the best, the home had multiple offers and they wound up with a $420,000 house in a slightly less desirable area.
                A personal note here. Scott grew up largely in Iowa and his parents still live there. He mentions homes there are $150,000. I’m not clear on why a $420,000 home in Bend was a more attractive alternative. But I’ve never been to Bend, and this is Scott's and Taylor’s story. But there are many places where housing is more affordable, including Kansas City (although given the city’s profligate spending on subsidized housing for the wealthy and a fixed rail fair weather only streetcar, I’d strongly favor the Kansas side if I were in the housing market today).
     
                Scott sprinkles the book with other people’s FIRE stories, which I found encouraging. After all, it may seem easy on the surface to cut a lot of unnecessary spending from a $142,000 annual budget, but how about those who make less? Jillian of Kalispell, Montana is 35 and reached FI at 32 on a $60,000 income. She spends $30,000 a year for a family of seven. She and her husband were extremely frugal and overcame many obstacles, but at 35, they’re financially independent. Kalen and Kyle of Evans, Colorado currently spend $32,000 a year. They’re 26 and plan to reach FI at 32 by continuing to save 65% of their income (which I estimate is $92,000 per year). And these are just a couple of the inspiring FI stories in this book.
                One young man gives this advice: For traditional employment, don’t pursue your passion. Find a company that appreciates its employees and will provide challenging work for equitable compensation. Make the rest of your life about pursuing your passion. Good advice, indeed.
                Scott concludes: “[O]nce you taste a truly free life, untethered to a schedule or a paycheck or a career ladder, you can’t untaste it. Once you ask yourself the most important questions—What do I want to do with my time, and what makes me happiest—you can’t ignore the answers.” (Italics his)

                While you’re waiting for the book, here are some websites Scott provides for you to check out the FIRE movement:

                Mr. Money Moustache: mrmoneymoustache.com

                Mad Fientist: madfientist.com

                Frugalwoods: frugalwoods.com

                Physician on FIRE: physicianonfire.com

                Early Retirement Extreme: earlyretirementextreme.com

                The Simple Path to Wealth: jlcollinsh.com

                Millennial Revolution: millennial-revolution.com

                ChoseFI: choosefi.com

                Afford Anything: affordanything.com

                When I contrast this book with Malcolm Harris (B. 1988)’s whinefest, Kids these Days, which I reviewed last February, there simply is no comparison. Mr. Harris (B. 1988) wallows in his misery, and that’s basically all he has to offer. Scott and Taylor are roughly the same age as Mr. Harris (B. 1988), and they offer a way for people to take control of their future and live the lives they want to live. And I’m happy to see the media are giving the FIRE movement serious coverage. With the future so uncertain (as it always is), FIRE provides a path to prepare for some of that uncertainty.

                I won’t go so far as to take Suze’s approach and say if you don’t follow Scott’s advice, you’ll wind up putting a gun to your head, but I don’t think you’ll regret reading what Scott has to offer.

                I hate to end this post with a downer, but in his latest post Pete Adeney, Mr. Money Moustache, reveals he and his wife have divorced. If there is good news here, it’s that their divorce is extremely amicable, and it was all accomplished for $265. Here’s wishing both of them the best.

                Next up: I’m going to fulfill a promise I made nineteen years ago.

©2019 Larry Roth