Tag Archives: economics

Friday Afternoon Ramblings – 8/23/2019

In my previous post, I mentioned Nick Hanauer and his belief in a wealth tax. I also pointed out what I see as the shortfalls of redistributing wealth via the government. However, it’s not productive to do that without offering an alternative solution, so as promised, here is my idea for how the super wealthy could impact the lives of average Americans.

On a completely voluntary basis, people with a net worth over one billion dollars could establish foundations that help individuals launch small businesses. Right now, there are millions of working people around the country who have the knowledge and skills to run a small business in their area of expertise, but they lack the capital to purchase the equipment, form the proper entity, and take the plunge into self-employment. They also might lack the knowledge to navigate all of the legal and bureaucratic obstacles.

However, if wealthy individuals like Nick Hanauer provided grants and also business coaches to assist with getting small businesses off the ground, more individuals could have opportunities to be self-sufficient. Because the money is not being filtered through the bloated bureaucracy of government, more of that wealth goes directly to the people Hanauer wants to help.

The major advantage of following this path is that people will have the opportunities to build businesses and wealth for themselves. Instead of government handouts, people will be offered a hand up to self-reliance. Instead of being tethered to larger businesses that may or may not pay decent wages, people from every social stratum could have more equal opportunities based on the effort they are willing to put into growing their businesses.

Obviously, this is merely a thumbnail sketch of the idea, but I believe that it is an idea worth pursuing by those who have the means to make it a reality.

That’s all for now.

Wednesday Afternoon Ramblings – 8/14/2019

Recently, I heard a podcast on Planet Money in which Nick Hanauer described his trepidation about the widening wealth gap in America. In case you aren’t familiar with him, he was an original investor in Amazon. Needless to say, he is on the wealthy end of that equation, and his opinions have ruffled a few feathers. His TED Talk on the subject has been removed, and many wealthy, powerful people disagree with his premise that the wealth gap is an issue.

He proposes that we should implement a wealth tax on the super wealthy in an effort to reinvest that money into communities. While I do agree with him that we need to close the gap, I vehemently disagree that a tax is the correct way to solve the problem.

First of all, the government is too inefficient and too bloated to make a substantial transformation. Maybe, maybe 50 cents on the dollar would get back to the communities that need it. The rest would be sucked into the bureaucratic black hole.

Second, nobody likes to be taxed. Nobody. We pay them because we must, but nobody likes it. Taxation simply feels like extortion. So gathering support for Hanauer’s will be difficult.

I have an idea for a system that would be better, and over the next few days, I think I will share it on here. In the meantime, you should check out Planet Money. It’s a pretty good podcast with a lot of informative stories about economics.

That’s all for now.

Thursday Evening Ramblings – 7/18/2019

I believe in the invisible hand. I believe that when market forces are allowed to function without excessive interference (like onerous regulations or protectionist tariffs) individuals will find an equilibrium for prices and wages.

One factor I’ve never quite understood, and maybe someone out there could explain it to me, is why we fixate on hourly wages for jobs in profit driven businesses. To me, an hourly wage is counterproductive for both the employer and the employee. It offers no incentive for an employee to work harder or be more productive in that position. As long as you show up and do the minimum required, you will earn the set hourly rate.

To me, it makes more sense to establish wage structures that are linked to productivity. If the business as a whole does well, both the employer and the employee earn more money. In the past, before computers were so prevalent, I can understand why this would have been impossible, but today, someone who is skilled at programming and math could easily tailor software for virtually every business that could calculate fair profit sharing wages.

This is an idea that both liberals and conservatives could find common ground on and improve the lives of just about everyone. I’ve worked in a broad range of businesses, and I could see this being applied everywhere I’ve ever worked. I once knew the owner of a repair shop who did this for his mechanics, and he said that his business absolutely exploded after he made the switch. Suddenly, those Friday afternoon jobs that normally were left until Monday morning weren’t quite as difficult to complete because the mechanic wanted the pay on this check.

If I were a person of influence, this would be my cause: to unite employers and employees in productivity-based wages instead of a set hourly rate.

That’s all for now.

Tuesday Afternoon Ramblings – 7/9/2019

On Black Friday of 2016, I found a cheap chainsaw on sale for $99. I heat my home 100% with wood, so at that point in my life, the deal seemed worth it. Unfortunately, the worthless piece of junk tore up within 4 months, and the company refused to cover it under warranty. In related news, I will never purchase another Poulan product for the rest of my life.

In March 2017, I had about $200 credit available on my card and about $150 cash. I was just getting the first baby steps of the tree and landscaping business going when that POS chainsaw laid down on me. At that point, I had to make a choice: buy another cheap POS or get something of quality.

At a local hardware store, I found the 18″ Shindaiwa pictured above for $309, plus tax. After tax, I had less than $5 left on my credit card. That was a difficult choice to make. If the tool doesn’t live up to the ratings, I’m broke. However, there comes a point when you have to take a chance. In economic terms, this is called measuring risk and reward.

I’ve used the Shindaiwa for 2 1/2 years now. It’s my primary tool in the business. The only one that rivals it is my Tanaka weed eater, but that’s a post for a different day. The chainsaw has broken down three times. Two were covered under warranty, but one was a wear item. I’ve probably used $600 worth of chains and bars in that timeframe. I’ve downed some sizable trees and processed a lot of firewood with it.

Looking back, that decision, to scrape together all of my capital and use it to make one major purchase for the business was one of the best steps I’ve taken. The tool has paid for itself a dozen times over and continues to do so. A mediocre tool might have gotten me through one year, but then I would have been replacing it, spending at least the same total amount of money in a shorter timespan. I’ll probably replace that saw within the next year, but it will always hold a special place as the cornerstone of this business.

That’s all for now.

Independence Day Ramblings (a day late) – 7/5/2019

The real problem isn’t Colin Kapernick. Or Donald Trump. They may be the symbols for anger, but they are not the problem. The problem is that we as a society fear and loathe the “other” in whatever form it takes.

The problem is that we don’t listen. We shout insults and obscenities at each other over personal beliefs instead of finding common ground and working towards reasonable solutions to real problems.

The problem is that we take examples of the extremes and generalize that to a whole group. We allow mass media machines, which only thrive when we tune in and consume their ads, to constantly poke at our anger for that other group and inflame our hatred for them, mostly so we will tune in tomorrow to see what new outrage “they” have committed.

Then, we act surprised when someone shoots up a school or a government building or whatever.

The problem is that we no longer respect each other’s right to life, right to culture. We are quickly slipping into a fascist wasteland where any dissent is met not by thoughtful deliberation but violent resistance.

The problem is that we so desperately want to be seen as part of the clever, intelligent side that we completely and utterly dismiss the opposition with straw man caricatures and derisive memes that dehumanize and degrade them as something unworthy of human compassion and rights.

The problem is that we have forgotten that living in a free society means that everyone is free to believe as they wish, and as long as they are not actively calling for harm to another person, they have a right to hold and express those beliefs. If we aren’t willing to defend the freedoms of those we disagree with, we don’t deserve freedoms ourselves.

Freedom isn’t about getting your way. It’s about all of us finding a way to live together. It’s about listening and sharing ideas. It’s about accepting that there is room for all of us in this world if we will just focus on finding solutions instead of inciting hate. We have the most beautiful framework ever created, a framework that has allowed itself to grow and morph and adapt to include more people and more views as time has progressed. Everyone who lives under the umbrella of that framework should take a moment and be grateful.

That’s all for now.

Wednesday Night Ramblings – 7/3/2019

When I started building that flower bed two and a half years ago, I survived off food stamps and the generosity of my parents. I’m incredibly grateful for both. We need a social safety net for people who stumble or get knocked down or just need a hand up. We don’t need a generational welfare system that reduces entire families to wards of the state, but that’s a different discussion for a different post. Without food stamps and my parents, I would not have survived the first 8-9 months, at least not without resorting to drastic measures.

I remember very clearly the first grocery trip paid for completely by my meager wages. I felt such a surge of pride that my sweat and muscle once again provided for my subsistence. I don’t know how people can be content living off of someone else’s money, whether that be the government, family, friends, or lovers. Obviously, there are people who are disabled and incapable of fending for themselves. I’m not talking about them. I’m talking about the able-bodied.

The feeling of doing for yourself is just too fulfilling. The sense of ownership that comes from earning the money to pay for your own stuff is so internally rewarding that I don’t understand how people can allow themselves to wallow in dependency.

When I finished checking out from that grocery trip, I felt like anything was possible. I know it was just a $40 bag of groceries, but it was so much more than that, too. I had tasted decent measures of success before, so I knew what it felt like. I had just survived some of the darkest moments I can imagine, and those scars were still quite fresh, but that little shopping trip on a winter’s night in January is one of my favorite victories.

That’s all for now.

Friday Night Ramblings – 6/28/2019

My least favorite human trait is envy. That’s not to say that I never feel it myself. Of course, I sometimes look at more successful people and wish things had gone better for me. Typically, however, I don’t dwell on coveting other people’s lives, and I try not to resent anyone else’s achievements. This is because I don’t believe that life is a zero sum game.

Back when my writing career was on an upward trajectory, many other writers within my circle of interaction would envy the small measures of success I had. Some would openly grumble when I did something good. Others would mutter behind my back (sometimes those remarks would get back to me). However, the ones who said those things wouldn’t attend as many conventions as I would, and when they did, they rarely would remain at the sales table as long as I did. They rarely hustled for as many radio/podcast/blog interviews. They rarely made as many sacrifices.

That’s my issue with envy. Most of the time, when someone is jealous of someone else’s good fortune, they desire the fruitful harvest, but they aren’t willing to plow the field and hoe the rows to get there. And in my experience, virtually every single successful person has worked damned hard to achieve what they have.

In terms of books, I never believed that I was in direct competition with other writers. Readers read as many good books as they can find, so I was in competition with myself to craft the best story I could compose. The same is true for my landscaping and tree business. No one business could possibly handle every job out there, so I’m not really competing with anyone except the expectations of my customers. If they are happy, I will get more work. It’s that simple.

Too many people seem to be jealous that they weren’t born a trust fund baby, able to lounge on the French Riviera and sip mimosas for brunch every day. And those people never seem content with their own journey, their own personal competitions. Would it be nice to have a bottomless well of cash? Yes and no. Sure, money can provide a lot of material comforts, but it doesn’t create internal contentedness. The wealthiest people I know are never really happy. Something is always missing from their lives. Happiness comes from recognizing the blessings you already possess and appreciating them.

Once you make that mental switch, from envying others to appreciating your own bounty, you can begin to savor each day as a new opportunity to accomplish something. And some truly cool things can begin to happen for you.

That’s all for now.