Government is for losers. Exactly!

In this post from October 2010, I wrote about a golden rule from India: the "dharma" of a rich person is to create a lot of wealth, and to donate wealth to charity.

The old Indian wisdom recognized that creating wealth is not only ok, but is the duty for some.  But, what comes after that wealth .... something like the "noblesse oblige" in the Western contexts.  Here is one:

संपदो जलतरंगविलोल
   यौवनं त्रिचतुराणि दिनानि ।
शारदाभ्रपरिपेलवमायुः
   किं धनैः परहितानि कुरुध्वम् ॥

- सुभाषितसुधानिधि

Wealth is as temporary as a wave on still water. Youth is just a matter of few years. Our life it self is as uncertain as a cloud of Sharat month (where clouds could get formed and dispersed in a matter of minutes. No rain.) What is the use of all the wealth that you accumulate? Spend them in a way that is helpful to others.

That golden rule is from way back in time, well before the modern concept of countries and governments.  In those bad old days, with wealth and power concentrated with a few, while the overwhelming majority toiled away, charity helped, and helped a lot.  Perhaps charity also helped in the small geographic areas within which the rich and powerful lived.

Now, the rich and the powerful have international reach.  But, our collective problems are way beyond the neighborhood.  Take climate change, for instance.  No amount of philanthropy can tackle that kind of a challenge. Or public health in these times when infectious diseases can easily spread not merely within a country but also across countries.

Philanthropy is no match against the machinery of the government.  However, for the government to address these challenging collective issues, well, the rich and the powerful need to pay up.  And for them to pay their share Republicans need to first acknowledge that our collective challenges, like climate change, are for real and are not some elaborate hoaxes!

If they acknowledged these collective challenges, then they would automatically realize that individuals and charities cannot fight carbon, for instance, and that a well-funded government will be needed for such huge campaigns.

For now, the head in the sand racist party can only keep chanting "tax cuts".

Writing in the NY Times, gazillionaire Eli Broad argues:

I’ve come to realize that no amount of philanthropic commitment will compensate for the deep inequities preventing most Americans — the factory workers and farmers, entrepreneurs and electricians, teachers, nurses and small-business owners — from the basic prosperity we call the American dream.

He continues:

I invite fellow members of the 1 percent to join me in demanding that they engage in a robust discussion of how we can strengthen a post-Trump America by reforming our tax code.

But, the racist party and their Dear Leader that 63 million voted for, which loves to associate with the far-right, will perhaps merely associate Broad, who is Jewish, with their favorite target, who is also a big time philanthropist--George Soros.

Let's see what happens in November 2020.

Money, meaning, and happiness

"I just work, work, work," he said. 

His wealth is way above average, but he does not want to call it quits because he doesn't know what he would then do with his spare time.

He asked me if I have changed my car.  I told him I have, and that it is a small little car.  His is a northern European luxury car.

He has added quite a few pounds since I last saw him. He doesn't have the time to regularly exercise, he said.

He is not the only one either.  I know of quite a few--my age and older--who work despite being well-beyond a comfortable retirement savings and investment.  And they also complain about not having time for the things that they might enjoy.

Such is the life of the wealthy and the miserable!

It is not as if they have not heard, or read, or talked about the cliche that a dying person does not ever think that they should have spent more time in the office.  Yet, the lure of money keeps them doing time in the office, even when they hate themselves for doing that!

One classmate described having to invest $5 million a day — which didn’t sound terrible, until he explained that if he put only $4 million to work on Monday, he had to scramble to place $6 million on Tuesday, and his co-workers were constantly undermining one another in search of the next promotion. It was insanely stressful work, done among people he didn’t particularly like. He earned about $1.2 million a year and hated going to the office.
“I feel like I’m wasting my life,” he told me. “When I die, is anyone going to care that I earned an extra percentage point of return? My work feels totally meaningless.”

Earns $1.2 million and gripes.  It is more than the work being meaningless--it is about the feeling of a meaningless life.

Perhaps they never constantly ask themselves a simple question: "What if today is the last day of my life?"

I have blogged in plenty about meaningful jobs that may or may not pay well, versus bullshit jobs whether or not it pays well.  I, for one, am glad to be doing something that provides me with meaning, both at work and in my personal life.

The author of the piece in the NY Times that got me thinking about these, Charles Duhigg, is a journalist.  A Pulitzer Prize-winning journalist.  And, with an interesting academic credential: He is an MBA from Harvard Business School!  He writes:

Some of my classmates thought I was making a huge mistake by ignoring all the doors H.B.S. had opened for me in high finance and Silicon Valley. What they didn’t know was that those doors, in fact, had stayed shut — and that as a result, I was saved from the temptation of easy riches. I’ve been thankful ever since, grateful that my bad luck made it easier to choose a profession that I’ve loved. Finding meaning, whether as a banker or a janitor, is difficult work. Usually life, rather than a business-school classroom, is the place to learn how to do it.

I am all the more convinced that I am a lucky guy!

Instant gratification is expensive

When my parents sat down and updated the family's cash flow accounts, which they did every few days, we kids were assigned tasks as well--from recalling the expenses to adding up the rupees and paise.  Thus, I grew up with no illusions of money stashed somewhere.  Knowing how my parents were cautious about every paisa, I knew that I had to be reasonable with my wishes.  I had to find happiness within those constraints, even though once in a while I did wonder what it would be like to travel to Delhi and Kashmir.

Even now, my parents sit down and do their accounting.  They no longer worry about the missing ten paisa though, unlike the old days.  It is not because they have lost any respect for the paisa, but I think it is because they are too old and tired to worry about the missing paisa.

In this age of instant gratification, I assume that most people do not think much about where their money comes from.  Further, when kids see parents using a small plastic card that gets them everything, I wonder how they might even learn about the age old idea of living within one's means.

At some point, the spending catches up with the reality.

Overall, U.S. households have $12.3 trillion in debt, according to another New York Fed report, released this week.

People who are worried about the federal debt, which is currently at $14 trillion (or $19 trillion, in another accounting) ought to be way more worried about the level of household debt.

When the accounting is done the honest way that my parents did, then it turns out that "one in seven Americans ends up in the red":

Even people with good jobs can owe so much on credit cards, student loans, or mortgages that, on paper, they’re worth less than zero.

In the old days, there was no concept of credit cards or mortgages.  Credit, in instant gratification, is perhaps like drugs to addicts.

We might be tempted to conclude that people like me, who have taken on too much of a mortgage loan, are the problem.  Nope.

Mortgages are a minor factor, the New York Fed found. Only 19 percent of people with negative net worth are homeowners, compared with 75 percent of those with positive net worth.

We might also be tempted to think that it is largely the uneducated who can't seem to understand cash flow.  Nope.

People with negative worth are a diverse group that defies stereotypes of the poor. One in eight has a graduate degree, and 43 percent have a college degree, only a few points lower than those with positive wealth.

Last June, one of the students I worked with graduated--with zero debt.  I strongly urged her, more than once, to write a commentary in the newspaper about how she achieved that.  She didn't buy fancy clothes, didn't own a car, didn't care to party hard, bought secondhand clothes, didn't travel abroad, focused on her school work, worked part-time, applied for scholarships, and yet had loads of fun and was my partner-in-crime with horrible groaners.  But then she, too, didn't listen to me--she didn't want to write about these.

I suppose it is not fashionable these days to live modest lives within one's means. Maybe I should go to the store and buy myself the latest gizmo and charge it to my card!  Nah; after all, I am Major Buzzkill ;)

I know you are not a busy person. Why? You are reading this!

Back when I was young--ah, those years that were so long ago--even when I was merely agnostic, I was convinced that there was nothing after death.  A conviction that there was, literally, only life to live.  Then, kaput. Gone. And, therefore, I didn't want to live a life that I did not want to and do something for a living that did not interest me.

I thank the cosmos (though the cosmos couldn't care whether or not I exist) for such an understanding early enough in my life.  

The way I earn my paycheck now is exactly how I would like to earn my paycheck--of course, a few more dollars will always help, but this is plenty enough.  "Plenty enough" in dollars is nothing compared to what I could/would have earned had I continued on with engineering.  But, this plenty enough provides me with a hassle-free life.  And has always provided me with an abundance of a commodity that no amount of dollars can buy--time.

Everybody, everywhere seems to be busy. In the corporate world, a “perennial time-scarcity problem” afflicts executives all over the globe, and the matter has only grown more acute in recent years, say analysts at McKinsey, a consultancy firm.

Incredibly busy many affluent people are.

A couple, who are a gazillion times wealthier than I will ever be, commented to me when we met before my Ecuador trip, "you are lucky that professors have a long summer break for such travels. We have no time."  I thought to myself that with all their wealth they could easily not work for another second in their lives and travel all they wanted to; but they choose not to because they equate not working with gazillons foregone.

When people see their time in terms of money, they often grow stingy with the former to maximise the latter.

But, unlike what we think, the problem is not entirely new either:

Writing in the first century, Seneca was startled by how little people seemed to value their lives as they were living them—how busy, terribly busy, everyone seemed to be, mortal in their fears, immortal in their desires and wasteful of their time. He noticed how even wealthy people hustled their lives along, ruing their fortune, anticipating a time in the future when they would rest. “People are frugal in guarding their personal property; but as soon as it comes to squandering time they are most wasteful of the one thing in which it is right to be stingy,” he observed in “On the Shortness of Life”, perhaps the very first time-management self-help book. Time on Earth may be uncertain and fleeting, but nearly everyone has enough of it to take some deep breaths, think deep thoughts and smell some roses, deeply. “Life is long if you know how to use it,” he counselled.

A wise Seneca observed the rich rushing around complaining about not having enough time, and this pretentious blogger also observes the same.  Perhaps we even observe these only because we are sitting quietly not rushing around chasing money!

But, once I turn my attention away from the affluent population, which includes me, and consider, for instance, the lives of the non-traditional students in my classes, then I notice a difference--those students are also incredibly short of time because they juggle school with work and family, and barely have any leisure time.  They, unfortunately, seem to lack both money and time.

Ultimately, more people at the top are trading leisure for work because the gains of working—and the costs of shirking—are higher than ever before. Revealingly, inequalities in leisure have coincided with other measures of inequality, in wages and consumption, which have been increasing steadily since the 1980s. While the wages of most workers, and particularly uneducated workers, have either remained stagnant or grown slowly, the incomes at the top—and those at the very top most of all—have been rising at a swift rate. This makes leisure time terribly expensive.
So if leisureliness was once a badge of honour among the well-off of the 19th century, in the words of Thorsten Veblen, an American economist at the time, then busyness—and even stressful feelings of time scarcity—has become that badge now. To be pressed for time has become a sign of prosperity, an indicator of social status, and one that most people are inclined to claim.

Let's see: those with gazillions are working even harder because they value their "free time" as way too much money to be lost, and those struggling for paychecks are working even harder because they cannot afford to take time off.  Isn't something seriously wrong with this picture?

Alas time, ultimately, is a strange and slippery resource, easily traded, visible only when it passes and often most highly valued when it is gone. No one has ever complained of having too much of it. Instead, most people worry over how it flies, and wonder where it goes. Cruelly, it runs away faster as people get older, as each accumulating year grows less significant, proportionally, but also less vivid. Experiences become less novel and more habitual. The years soon bleed together and end up rushing past, with the most vibrant memories tucked somewhere near the beginning. And of course the more one tries to hold on to something, the swifter it seems to go.

The faster does time fly as we age, and as we rush around.  But, it will all end; after all, as I like to say, we all come with our own expiration dates.  Perhaps there are those who will think in their death-beds,  "instead of watching the sunset, I am so glad I spent a couple of additional hours in the office in order to earn more."

I, for one, am so glad that I have the time to watch the river flow by, the birds chirp, the sun set, the children scream, the adults yak in their cellphones, the older folks shuffle along.

If you behave well, I will even spend some of that time with you ;)

Source

If I were a rich man ...

As a starving graduate student--ok, "starving" is an exaggeration--every once in a while I played the lottery.  I typically bought a quickpick lotto ticket for a dollar--this was back in California.  It was always a disappointment that I never had even two numbers that matched with the winning ones.  I comforted myself with "unlucky with money, but lucky in love."

And then I won.

Five dollars!

And those five dollars is all I have won all my life in playing the lottery.  I was excited that I finally won something.  So elated I was, I immediately spent it all on, yep, five lottery tickets.  And, yep, no more wins.

The "starving" graduate student!

As life picked up, it seemed like I had gotten to be lucky with love and with money.

But ... it then became a stereotypical country music song that I live: dog died, wife gone, and no money :)

Of course, "no money" is one heck of an exaggeration.

What I earn now will place me in the global top one percent.  Yep, I am one of those awful one-percent.

But, I don't feel like I am in that kind of an economic stratosphere because I don't get to see the more than six and a half billion whose lives are nowhere even close to my level of material affluence.  I can, however, and pretty much on a daily basis, see those who are even more affluent.

But, I am almost always content and happy.  One student, "D," who every once in a while pokes his head into my office, comments variations of "we shouldn't pay you because you look happy all the time."  "D" is not wrong at all; I am sure my contentment shows.

Is there a relationship at all between material affluence and contentment and happiness?  I would think that the longest stretch of not at ease within were during the days--years actually--from the final phase of high school until I came to the US.  That was one long stretch of about seven years.  But, it wasn't because I was penniless and thrown into the gutters.  It was simply because of angst within.  The wonderful food that my mother cooked or the pleasing music or anything else were comforting, yes, but that angst triggered unhappiness was always there.

It is not without reason, I suppose, that we mouth that old wisdom that happiness comes from within.  It is true, dammit.  Money certainly helps, but I guess money is neither a necessary condition, nor a sufficient condition, to make one happy.  Could I be happier with a tad more money?  You betcha!  But, do I do anything at all with a goal of increasing my material affluence?  Hell no. My life isn't about making more money for myself.

My interest in economic development, which led me to graduate school, meant that I read up about this happiness aspect of economic development as well.  A mere maximization of the GDP didn't appeal to me as the be all and end all of how to think about poverty in the developing countries.  After all, I had seen plenty of poor in India who seemed to be having fun in life.  They seemed happy from what I observed.  Many with money seemed nowhere that happy from what I observed.

One of the articles I read was by Richard Easterlin.  Interestingly enough, Easterlin was on the faculty at USC at that time, and two graduate students from India, who were friends of mine, were working with him on their doctoral dissertations.  Anyway, the article was about the "Easterlin Paradox"--happiness across countries did not seem to relate to per capita incomes.  Simply put, more money doesn't mean more happiness.

That paradox, as one can imagine, appealed to me right away.  It was consistent with my own life experiences, though I hadn't had all that experience when I was barely 25!  It made intuitive sense that money alone does not get happiness.

But, I would think that if one is literally starving for food because of poverty, then money could bring in immense relief and happiness. One could then theoretically argue that as we climb up those economic levels then the happiness brought in by the additional dollar is not as much as the happiness brought in by the first dollar.

Ronald Bailey writes in Reason that, well, I am wrong--more money is more happiness:

Two economists at the University of Michigan, Betsey Stevenson and Justin Wolfers, reject the Easterlin Paradox. Their new article, published in the May American Economic Review—argues that more money does buy more happiness. As evidence, the two compare happiness measures between rich and poor countries and between rich and poor people within countries.

After discussing the research findings, Bailey winds down to this:

There is no income threshold when it comes to procuring more of this kind of happiness. It is certainly wonderful and valuable to enjoy the moment, but real and lasting pleasure comes from a life well-lived. More money can’t guarantee a satisfying life, but research shows that it sure does help.

My point exactly.  Money is neither a necessary nor a sufficient condition for happiness.  But, having money does help.