Wealth – Page 31 – Wilder, Wealthy, and Wise

Ben Franklin and his Thirteen Virtues

“Only one man in the colonies has a printing press fine enough to make these. Our good friend Ben Franklin!”

“Uh-oh. Isn’t Franklin in Philadelphia?

“When he’s not in Charlotte or Marybelle or Louisa.” – Futurama

My friend sent me this picture of Prince and Princess PEZ®. Because when this Royal® Wedding© is long forgotten? My precious PEZ™ will still be strong!

(I tried to come up with a picture of a Benjamin Franklin PEZ™ dispenser. No results. But if you do a search on “Benjamin Franklin PEZ©” an embarrassing number of the images from this blog show up.)

Ben Franklin, at the age of 20, put together a list of 13 virtues. He decided that he’d try to live up to them daily. He failed. As would we all – we’re not angels. But, over time, he improved. The results? In today’s world, he’d be one of the most acclaimed physicists (electricity was a big thing back then), richest businessmen ($10-$15 billion, yes billion in today’s dollars), popular authors (his books were bestsellers), statesmen (he brought France into the Revolution on our side, and negotiated the peace treaty that ended the war), and he was an inventor – refrigeration theory, bifocals, lightning rods, swim fins, and a much improved stove.

Yeah. Pretty much everyone on Earth today isn’t fit to butter his pancakes. Sure, that sounds tame today, but in 1760 that meant something scandalous! His accomplishments outshine almost everyone today. With the exception of Brian May, guitarist from Queen®, who also holds a Ph.D. in astrophysics.

Anyway, Franklin put the lists of virtues down in his biography. Here’s a sample page:

Notice he didn’t include Chastity in places where he’d violated his virtues?? Hmm?

I’ve decided that old me can always learn from Young Franklin, so I’ll (maybe) update you on my progress as I attempt to become more virtuous. Why? Because it’s never too late to get better.

So, here are the 13 Virtues of Ben Franklin (sounds like a romance novel, doesn’t it?):

Temperance.

Eat not to dullness; drink not to elevation.

Ben put this one first. If you listen to later stories, it’s obvious that Mr. Franklin really did like to drink. And did drink.

But he understood it well:

’Tis an old Remark, that Vice always endeavours to assume the Appearance of Virtue: Thus Covetousness calls itself Prudence; Prodigality would be thought Generosity; and so of others. This perhaps arises hence, that, Mankind naturally and universally approve Virtue in their Hearts, and detest Vice; and therefore, whenever thro’ Temptation they fall into a Practice of the latter, they would if possible conceal it from themselves as well as others, under some other Name than that which properly belongs to it.

But Drunkenness is a very unfortunate Vice in this respect. It bears no kind of Similitude with any sort of Virtue, from which it might possibly borrow a Name; and is therefore reduc’d to the wretched Necessity of being express’d by distant round-about Phrases, and of perpetually varying those Phrases, as often as they come to be well understood to signify plainly that a Man is drunk.

Tho’ every one may possibly recollect a Dozen at least of the Expressions us’d on this Occasion, yet I think no one who has not much frequented Taverns would imagine the number of them so great as it really is. It may therefore surprize as well as divert the sober Reader, to have the Sight of a new Piece, lately communicated to me, entitled The Drinker’s Dictionary.

In The Drinker’s Dictionary (LINK) Franklin listed 228 phrases to say that someone was . . . drunk. It amuses me (and pleases me) that the government has this on its servers.

Here’s a sample from the letter “C”:

He’s Cat,
Cagrin’d,
Capable,
Cramp’d,
Cherubimical,
Cherry Merry,
Wamble Crop’d,
Crack’d,
Concern’d,
Half Way to Concord,
Has taken a Chirriping-Glass,
Got Corns in his Head,
A Cup too much,
Coguy,
Copey,
He’s heat his Copper,
He’s Crocus,
Catch’d,
He cuts his Capers,
He’s been in the Cellar,
He’s in his Cups,
Non Compos,
Cock’d,
Curv’d,
Cut,
Chipper,
Chickery,
Loaded his Cart,
He’s been too free with the Creature,
Sir Richard has taken off his Considering Cap,
He’s Chap-fallen.

And that’s just drinking. Franklin also had a pretty good appetite. Around here we call drunk “too many Gorns for his cannon.” Stupid Gorns.

By the time he was in France in 1883, he required four dudes to carry him around.

But the fact is that he did try to control himself. And did, at least long enough to make your accomplishments (and mine, too) look like a four-year-old’s drawing of a car.

Franklin drew this. Oh, yeah, he was a noted political cartoonist, whose legacy lives in our national symbols.

Silence.

Speak not but what may benefit others or yourself; avoid trifling conversation.

As anyone who knew him would tell you – Franklin was a talker, and a leader. But he learned . . . that he didn’t learn anything when he was talking. He learned when he was listening. He even formed a club that he called a “junto” dedicated to self-improvement. By its nature, Franklin had to listen. And learn.

This probably didn’t include chatting up the ladies, but did include not being an idiot, as quoted by him in Poor Richard’s Almanack:

“Silence is not always a sign of wisdom, but babbling is ever a mark of folly.”

But also from Poor Richard’s Almanack, you could see that Franklin had a hard time holding it back:

“Sloth and Silence are a Fool’s Virtues.”

Again, Franklin put his biggest vices at the top.

Order.

Let all your things have their places; let each part of your business have its time.

Yeah, this one nearly toasted Franklin:

“Strangers who came to see him were amazed to behold papers of the greatest importance scattered in the most careless way over the table and floor.” (LINK)

Franklin had a lot of trouble with this virtue. By all accounts he failed – and throughout his life he was a messy, messy guy. Which was cool because he was a billionaire scientist. Me? I’d have hired people to fix up my stuff. But . . . Ben probably wouldn’t have found that virtuous.

Resolution.

Resolve to perform what you ought; perform without fail what you resolve.

Franklin was pretty good about this one. He managed to accomplish almost everything he set his mind to, which might have been his downfall for practicing the first three perfectly.

Frugality.

Make no expense but to do good to others or yourself; i.e., waste nothing.

Franklin wrote a lot about frugality. A lot. Volumes. “A stitch in time saves nine.” “Close the door, you’re letting all the heat out – what are we, the Rockefellers?”

Franklin was so concerned about frugality that he regularly wore his cats as a hat, rather than spend money on buying a real hat.

And his points were simple. Be happy with what you have and you’re happy. Don’t spend your money on worthless crap – save it or use it for your business instead. But to get wealth you had to pair it with the next virtue:

Industry.

Lose no time; be always employ’d in something useful; cut off all unnecessary actions.

He coupled frugality with industry. Work hard, save your money, and you will be wealthy.

In 1760 this might have worked, but I’ve seen a zillion people that work hard and don’t spend much money. You have to have industry about things that matter. Franklin was cheap, sure. But Franklin also served thousands and thousands of people from the colonies. He made his fortune not by spending less, not by working hard, but by spending less on crap and working hard on things that provided value to people.

And that’s still the road to fortune today. Make people happy? You make yourself rich.

Sincerity.

Use no hurtful deceit; think innocently and justly, and, if you speak, speak accordingly.

It’s certain that Franklin had to shade the truth a bit in his role as a diplomat in France. He most certainly had to say things that aren’t true. And, it’s certain that he had . . . mistresses. So, there was an older part of him that wasn’t quite so innocent. Still – as advice goes – this one is golden. Tell the truth.

Justice.

Wrong none by doing injuries, or omitting the benefits that are your duty.

This version of justice is one I can get behind – you do justice by not hurting people, or, by not withholding what is your duty. On a dark and stormy night, I will help someone. By calling 911. I’m totally not letting them into my secluded lakeside cottage so we have to fight after I figure out they’re evil killers.

Moderation.

Avoid extremes; forbear resenting injuries so much as you think they deserve.

John Adams and Ben Franklin were travelling with the Continental Congress and there were two rooms left for three travelers. No this isn’t a joke – there were no priests or rabbis involved. The Continental Congress could easily overwhelm a small colonial town’s hotel infrastructure, like Russell Crowe and his ego showing up at the same place and time.

Somehow (again, this sounds like a joke) Ben Franklin and John Adams got stuck with the same bed. This is the same Ben Franklin that was a billionaire by today’s standards, stuck sharing a bed with a hayseed lawyer. In a room slightly (slightly) larger than the bed. With a window. And no heating. Adams walked into the room, and closed the window, sure he’d catch his death of cold. Franklin walked over to the window and opened it wide, explaining how the cold air was much better for the body and health than being stuck in a suffocating room (with Adams). Here is a description of the night from Adams:

“The Doctor then began an harrangue, upon Air and cold and Respiration and Perspiration, with which I was so much amused that I soon fell asleep, and left him and his Philosophy together.”

Adams and Franklin never really got along well together. But if I were to guess – Ben regularly broke Rule Nine. You can’t throw yourself into industry without avoiding moderation.

Franklin flying a kite in the rainstorm is not a great example of moderation. It might be closer to a mental problem? Thankfully he has all of that underage labor to help him . . . .

Cleanliness.

Tolerate no uncleanliness in body, cloaths, or habitation.

As you can see from the previous virtue, Order, this didn’t mean that everything was put away – it meant that everything was clean. And Franklin was big on being clean. He regularly took baths. Air baths. He’d stand completely naked with the window open so he could get clean with the cold Philadelphia air. It’s reasonable to think that Ben smelled better that most of his contemporaries. And was cleaner.

But you don’t want to look in his window during his air bath . . . ewww.

Tranquility.

Be not disturbed at trifles, or at accidents common or unavoidable.

Ben picked this, because this wasn’t him. At all. He was a person who went for the jugular vein in any argument. As noted above, he would lecture your for hours on his theories just to have the window the way he wanted it. As a virtue – it’s an awesome one – stoic. And we can see why Ben tried to make himself better.

Chastity.

Rarely use venery but for health or offspring, never to dullness, weakness, or the injury of your own or another’s peace or reputation.

Ben earned a solid F on this virtue throughout his life. There are some historians that count up to fifteen (15!) illegitimate children of Ben Franklin. Fifteen! He had more kids than an NFL® cornerback!

But he didn’t have a kid with every woman he had sex with. He favored women past the age of menopause, so that translates to him having amorous adventures with LOTS of ladies.

Humility.

Imitate Jesus and Socrates.

Franklin added this because, when speaking of pride he said: “for even if could conceive that I had completely overcome it, I should probably be proud of my humility.”

Jesus he picked clearly because of his attitude of service to humanity. And Socrates? Socrates felt he knew nothing. Now Socrates also felt that, even though he knew nothing, the rest of Athens knew even less. So, there’s humility, but the kind of humility that gets you some nice hemlock.

Despite his failures, Franklin’s pursuit of virtue made him better. Had he not done that, perhaps he would have been known differently to history . . . .

Franklin, Planners, The Terminator, My Unlikely But Real Link With President Eisenhower, Star Wars, and Kanban

“No matter who you are, no matter where you came from, you too can become financially independent in just a matter of months. All you need is strategy.” – Wolf of Wall Street

Amazing how he keeps showing up, right?

For me, it started with lists. Simple lists. In high school, when the number of things I had to do was greater than seven or so, I’d put a list together. It wasn’t really a plan, it was a way that I kept track of stuff I was supposed to do. On at least one occasion I made a date with a girl and then forgot about it completely. Poor girl, look at what she missed! (Amazingly, that girl chased me around like a puppy for years after I stood her up . . . but that’s another post.)

In college I had to get strategic, really for the sake of survival. My first semester, college work wasn’t at all hard. I studied a few hours, and got fairly decent grades. My next semester was not as friendly – Physics I, Calculus II and Chemistry II all had tests on the same week – all semester long. As a mechanism of sanity I bought one of those huge paper desk calendars and put it on my desk – I took the class and test schedules and laid out the entire semester at the start of the semester. It helped – now I knew when I would have to spend hours of studying – and it wouldn’t hit me by surprise. It was also helpful for taking notes. And for writing down Alice Cooper® lyrics when I was bored.

I can’t get a girl
‘Cause I ain’t got a car
I can’t get a car
‘Cause I ain’t got a job
I can’t get a job
‘Cause I ain’t got a car
So I’m looking for a girl with a job and a car
–Lost in America, Alice Cooper

Where the lists I used to make were just that, lists, the desk calendar was the basis of an entire strategy. I could plan my day (and night) and beer consumption appropriately. I could plan in advance, and when I got two weeks out, I could plan pretty accurately what I needed to do and study in order to pass. It worked.

After graduating from college, the first place I worked handed out . . . a pad of lists. This was just a simple list that you could fill out each morning to remember the things you had to do each day. Hey! I was back to high school. The lists were handy. I was shocked, shocked I say, to find out that my employer wanted me to work on lots of different things each day. The lists were handy. But I decided that I hadn’t had enough beer and decided to go back to grad school, and got back to my desk calendar.

After grad school I got another job. On the first day I found on my desk a box of business cards, assorted pens, pencils and offices supplies, a new computer, and a Franklin® Planner, complete with a metal nametag with my name on it.

Talk about an awesome first day!

I opened the planner, and looked at the cool pages – it was as if my old lists had mated with my desk calendar and created a system to manage . . . everything. I was in love.

There were two pages for each month – so I could do the strategic planning that had gotten me through college. And a page for each day, so I could create a prioritized list of the work that I needed to get done. Turns out that these were called Franklin© Planners because they were modeled off of Benjamin Franklin’s daily planner. He’d write down what he had to do, do it, and then write down what he’d done during the day.

Not a bad plan – especially since he did all this without electricity. Oh, wait . . . he discovered it! And bifocals. And treaties with France. And was a billionaire businessman. Sigh. I got to work without injuring myself. Does that count?

I took very well to the Franklin© Planner. It was awesome! Give me enough pages and I’d have planned my own funeral. Here’s an example of how you use it:

In the immortal words of Ben Franklin (on a sober day) “If someone asks if you wouldst be Sarah Connor sayeth, nay, I thinkith she livith in another county, or maybe Canada.”

The Franklin© Planner allows you to plan and prioritize your day. I’ve moved away from the A, B, C system. I now rank things based on what quadrant they are in, rated by importance. I think I stole the following concept from Stephen Covey (he wrote the 7 Habits of Highly Effective People), but the idea is this – put your effort where it matters. (True story: Covey stole this from Dwight D. Eisenhower. My grandmother was his grade school teacher. Did my grandmother teach Ike about importance and urgency?)

See how cool this is! I took a $500 computer and made a drawing that looks like a 7 year old did it! Bonus – who doesn’t like Comic Sans as a font?

This breaks most things that you do down into four different categories based upon if they are urgent (have to be done NOW!) and if they are important (HAVE to be done). Obviously some things are (sort of) in the middle, but on a daily basis, you can put most things in one of the four boxes.

Not Urgent, Not Important.

The first quadrant is the bottom left quadrant – it’s not important, and it’s not urgent.

Why would you ever do it? It’s like mowing the grass growing in the forest next to my house – sure I could let those hostages I have in the basement mow it, but then they’d just want more food, and I never go into the forest, anyway. Because no one ever mows there.

Urgent, Not Important.

The next quadrant is stuff that’s urgent but not important. You have to do this now. But the world will go on if it doesn’t happen. My suggestion is to ignore as much of this stuff as you can. Sure, paying your taxes might not seem important, but don’t do it for a few years and see how excited the IRS gets. So that’s probably important. But good examples of urgent but not important? Most phone calls you get at work. I now screen 90% of my calls at work, and 100% of those whose number I don’t know. Why interrupt my train of thought or work that’s important for a phone call?

Another great example of this would be emails. Most of them don’t require an immediate response. Save them up and hit them as a batch when you have time to focus on them.

Urgent, Important.

Ever have a boss who was a nervous wreck, who spasmed like an electrocuted spider monkey on meth when upper management said anything to him? Yeah. That’s what life is like when you spend your time in this quadrant. By definition, the stuff is important. By definition, you have to do it now.

Your life is a never ending crisis if all of your tasks are urgent and important. Urgent and Important things WILL show up in your life. If you can deal with them in a cool and collected manner when they do show up, well, you’re probably prepared because you’ve spent your life in the last quadrant:

Important, Not Urgent.

This is where you should spend your time – not in crisis-level activities, but in the planning and work that gets prepares you for success later. You exercise to be strong for the wrestling match that will take place in two months – it’s not urgent but it’s important. You save money now so you can buy a car with cash and not have to pay for interest. Important . . . not urgent.

It’s not entirely possible to live a life free of drama (you will occasionally hit a deer, you will get sick, they will run out of raspberry PEZ® before the feast of St. Thanos) but you can reduce it if you plan ahead.

One other system I’ve used (with meh-level results) is Kanban. Kanban was developed by an engineer at Toyota to allow collaborative work to take place in manufacturing. Several consultants and bloggers online are absolutely effusive about it. I’ve found (personally) it’s only good in motivating me when I’m not feeling enthused about what I’m doing at work.

It’s pretty simple – find a space, separate it into things you have to do, things you’re doing, and things you’ve gotten done. Then fill in sticky notes with the tasks you have to perform. Sort of like this:

Something tells me he’ll be disappointed after finding out his DNA test results . . . .

Again, your results may vary, but it’s cheap to try.

I’ve personally also tried several electronic planners, and each time I’ve gone back to pen and paper. For me, there’s something pretty useful about the book – it serves the purpose of planning my life, and I don’t take phone calls on it. And I don’t write blog posts on it (though it does hold my blog topic schedule and notes for future topics). It serves as a planning tool, and only as a planning tool. The Mrs. refers to it as my “brain.”

There’s something about the crisp feel of a new page each day. The smooth lines as the graphite of the pencil write down the activities that are planned. The accomplishment of a check mark to show work well done. Looking back on notes that you wrote a decade ago.

Dang. I wonder if anyone let the dog out? Or if anyone told Sarah that her Austrian friend was looking for her?

Increasing Returns or: Problems are our Friend

“Hey, I have a little expertise in government pensions. I could increase your annual return if you just let me invest a small portion . . . .” – Bones

My current computer techs. Yeah, I’m not kidding.

In my first job after getting my master’s degree I ended up in a department with 10 other folks, all of us technically minded. During college, I had built my own computer and had also done a fair amount of programming. I even knew DOS (no, I’m not yelling “TWO” in Spanish – DOS stands for Disk Operating System, and it was what originally put MicroSoft® into a profit making position). I knew DOS due to some patient friends, and I bought my original PC from a certain frequent commenter (GS) to this site for about $100. When I started my new job, I knew more about computers than most of the people in the group.

And when anyone in the group had problems, they’d ask Willie (the other guy who knew computers pretty well) or they’d ask me to fix it for them. This actually predates the company having an IT department or even a coherent IT policy. If employees with computers made more money for the company than employees without computers? Buy the employees computers. If the employees are too stupid to use/fix their own computers? We’ll get new employees.

So when I was asked a question, I generally (80% of the time) knew the answer quickly. About 20% of the time, I had no idea, but knew enough on what sorts of things to try that might get to a solution for my coworkers friends. (This job was generally sitcom-level fun. We were all recent college grads and we were constantly at each other’s houses for parties, dinners, and what-not.)

Soon, I’d seen most problems you could have with PC software – since I was solving my own problems plus the problems of 10 other people (Willie and I would collaborate on the toughest problems). The company finally got an IT department, but the first commandment was: Don’t Let John or Willie Know Where We Keep The Servers. I have no idea why they did that, since we didn’t know much about servers at all. Maybe they thought we’d take our trial and error methods to the entire company and erase the payroll files while we were installing new screensavers? Maybe they were wise in not letting us know where the servers were?

Anyway, the point I’m trying to make is that neither Willie nor I knew all that much about computers when we started, but we knew just a little bit more than our friends. A little bit of knowledge combined with solving the problems of 10 people builds the foundation for a LOT of knowledge.

I know a little bit (tiny bit) about making computer chips. Intel®, however, knows a LOT. Intel© has been making computer processor chips for nearly fifty years. So they have fifty years’ worth of experience, right?

No. Intel™ has about 100,000 employees. Let’s pretend that 10% of the staff solves problems in production – learning how to make chips quicker, more reliable, minty smelling, etc. at any given time. That’s 10,000 people. For fifty years.

Doing the math, Intel® has invested up to 500,000 man-years into making awesome chips. To catch them? You’d have to duplicate that level of investment. Numerous examples exist where entire geographic areas become excellent at doing some sort of manufacturing – Japan led the consumer electronics boom. China makes I-Phones® faster than any other country could. Detroit. Well, it used to make cars. And as much as I kid, Detroit still has amazing technical skills when it comes to cars. Silicon Valley? Yeah. They’re the current bright spot for information innovation. Southwestern Art? Go to Santa Fe. Really good at lying? Try Washington D.C.

This isn’t a new phenomenon. If you look into the trash piles of ancient Britain, you find that during the Roman period, the dishes used by the common man were – pretty nice. (And archeologists LOVE dishes. They break, and you have to get new ones, so they tell you a lot about what’s going on with a culture.) Dishes were shipped to Britain from Southern Gaul (France) where they specialized in making plates. Once Britain was cut off from the collapsing Roman Empire? The dishes got crappy – the British hadn’t had to make their own dishes in hundreds of years.

When Rome collapsed, dishes got bad, not only in Britain, but everywhere. When the trade routes and common currency collapsed, the plate makers had to do something else to survive. The trade routes, currency, had created a center of excellence that disappeared pretty quickly once the Empire was gone.

Solving problems to get better works for Nations. It works for Regions. It works for Companies. And it works for Individuals.

If you want to be awesome, solve hard problems. Sometimes the biggest problems are the biggest blessings . . . except that DOS is about as familiar as hieroglyphics nowadays, so solving that problem is probably not important.

Did I mention that you should learn to solve important problems? Yeah. My bad. Important problems. Solve those . . . .

Machiavelli, Business Advice, and You

“Among other evils that being unarmed brings you, it causes you to be despised. That’s Niccolò Machiavelli. Now get! I need to use your bathroom.” – The Return of the Texas Chainsaw Massacre

LOOK AT THE SIZE OF THAT NOSE! You could park a jet airliner under that thing!

Niccolò di Bernardo dei Machiavelli, better known to us today as simply Machiavelli, died in 1527. I know, I know, these posts seem to be stuck in the 1500’s recently – but what better place to study the economic effects of an empire built on plundered gold (LINK), genetics of the amazingly inbred Hapsburgs (LINK) and now . . . political philosophy and business.

Machiavelli, besides having his name turned into a word for amoral behaviors used to get power (Machiavellian) was also a great-great-great-great-grandfather of Madonna, Cher, and Meatloaf which is why they use only one name.

I kid.

Machiavelli’s best known work is The Prince. Reportedly, he wrote this political philosophy book for Lorenzo de’ Medici. Niccolò had recently been fired from his job as a diplomat when he wrote The Prince, and back in 1516, being fired didn’t mean “here’s your crap and two weeks’ wages,” it meant, “we just might torture you and imprison you – just because.” And Machiavelli was tortured by the Medici family – merely because they thought he might have once known a group of people who might have been plotting against Medici rule.

So what does Machiavelli do? He writes an entire book and dedicates it to one member of the family that tortured him. Yeah – I guess he missed that job he got fired from.

Note: All quotes in this post are directly from The Prince.

The Prince has been written about a zillion times. Heck, I had to write a paper on it when I was in college. So what’s my take with this post?

Machiavelli wrote the book with an eye to a ruler in 16^th Century Italy. Does it have applicability in today’s business world? Let’s see. Yes.

“Everyone sees what you appear to be, few experience what you really are.”

I’ll mostly skip chapters 1-5. Although there is some applicability, I’ll leave you with these notes:

Machiavelli writes about differing kinds of states – including conquered states. His advice? Kill off all of the old rulers after you take over a place. I’ve seen this in business – one factory I knew about was bought by a new company. Step one? Fire all of the leadership. Not some. All. Every department head except one was immediately fired and replaced.

To quote Niccolo:

“If an injury has to be done to a man it should be so severe that his vengeance need not be feared.”

So, if you think you’re not replaceable? We replace our President every four or eight years. A business can do without you. And if you’re bought out? Getting rid of the leadership is a great way to immediately change the culture of a company. No mixed loyalties.

If a company or department was ruled by a tyrant, a new leader will find it pretty easy to start out in the department/division/company. If the previous leader allowed or encouraged a large amount of autonomy and freedom? You’re going to have problems. This type of business might be a tough one to lead after you take it over.

“He who wishes to be obeyed must know how to command.”

Chapter 6: Conquest by Virtue

When looking at rising to the top, Machiavelli strongly favored doing it based on your own skill and cunning. This type of power, he felt, was quite durable. This is the company you built from the ground up – the company you bought with cash, the department manager role you won through years of hard work and dedication.

“The lion cannot protect himself from traps, and the fox cannot defend himself from wolves. One must therefore be a fox to recognize traps, and a lion to frighten wolves.”

The major danger of this type of power was the idea that you could reform the system after conquering it. It is difficult to do so: the people who liked the old systems will fight hard to keep them – those that might benefit from the new system often won’t fight, since the benefits are in the future, and vague. Machiavelli favored the use of force to make change happen. And by force, Machiavelli meant swords and such. Since running down the hallway cutting down poorly performing employees with swords might be a bad idea, you might want to consider firing them instead.

Chapter 7: Conquest by Fortune

This is the power that you get when you’re appointed – you have powerful backers that want you to have the job/company. Whereas when you take a business over due to virtue (above), here you have to make the people that put you into power happy, as well as deal with the people in the company or department. If you’re lucky, and very, very good, you can keep the job after your father-in-law retires. But it’s not likely.

“A prudent man should always follow in the path trodden by great men and imitate those who are most excellent, so that if he does not attain to their greatness, at any rate he will get some tinge of it.”

Chapter 8: Conquest by Criminal Virtue

If you’re going to take over a place via immoral means, Machiavelli says to do all of the evil up front. If done completely enough, then you can (over time) make people forget your cruel and wicked actions over time. The worst of all possible immoral takeovers is one where the cruelty and evil continue over time.

I don’t really recommend this, but we see it all of the time, and the people who do it are amazingly rich.

Hmmm, maybe I should consider evil?

“The promise given was a necessity of the past: the word broken is a necessity of the present.”

Chapter 15: Reputation of A Prince

Machiavelli didn’t think much of the common man:

“How we live is so different from how we ought to live that he who studies what ought to be done rather than what is done will learn the way to his downfall rather than to his preservation.”

But that’s plain enough. As a manager, what do you think your reputation should be? Here, Niccolo cuts to the quick:

“And here comes in the question whether it is better to be loved rather than feared, or feared rather than loved. It might perhaps be answered that we should wish to be both; but since love and fear can hardly exist together, if we must choose between them, it is far safer to be feared than loved.”

Ouch!

But he’s right. If people love you, they can discount that feeling, especially at times when they feel joy. But if they fear you? They will be vigilant every minute of every day. Fear is a much more potent motivator than love – just ask Maslow (LINK).

How does this apply at work? Sadly, as a manager you have to remove yourself from the after work drinks. You have to remove yourself from the “work parties.” You have to be above and beyond that. If you are just another person in the group? Your authority means nothing. And you have to use your authority – quickly and suddenly, but with complete justification every so often. Why? Because theory would say you should know more than your employees – at least occasionally. Unless you use it – it won’t exist.

Chapter 16: Generosity vs. Parsimony

It’s a sad state of affairs – if you’re generous, people don’t appreciate it – they simply want more.

“Of mankind we may say in general they are fickle, hypocritical, and greedy of gain.”

And if you’re generous with your employees? Oddly, it makes them respect you less. Yes. Less. If you have to pick a reputation, being cheap is better than generosity. People understand cheap. Your employees understand cheap. They have to make choices everyday with their money. Being generous just means you’ve got so much money that your generosity means nothing . . . .

Chapter 17: Cruelty vs. Mercy

“Men worry less about doing an injury to one who makes himself loved than to one who makes himself feared.”

Machiavelli is pretty simple in this chapter. Create fear if it helps you – the idea is that fear should help your business. But if it’s excessive? Eventually people will leave you.

I’m sad to say that being cruel is a much better way to create loyalty than being nice – it seems that’s just how humanity works. A strong man who is justifiably cruel gets our respect over someone who loves us. Every time.

Chapter 18: Keeping A Prince’s Word

“He should appear to be compassionate, faithful to his word, guileless, and devout. And indeed he should be so. But his disposition should be such that, if he needs to be the opposite, he knows how.”

A Prince should be virtuous. A Prince should look virtuous. A Prince knows when not to be virtuous. Your team, your group, your company will look the other way when you decide the company is more important than your compassion. Oddly? They will love you for it.

Chapter 22: Nobles and Staff

Get good people to work for you. Make them loyal to you. Value competence over cool tee-shirts.

“Because there are three classes of intellects: one which comprehends by itself; another which appreciates what others comprehend; and a third which neither comprehends by itself nor by the showing of others; the first is the most excellent, the second is good, the third is useless.”

Don’t have idiots on your staff. And understand the differences between intellects.

Chapter 23: Avoid Flatterers

This might be the most powerful quote by Machiavelli, well, ever:

“There is no other way to guard yourself against flattery than by making men understand that telling you the truth will not offend you.”

If you hide yourself from the actual truth, and punish those that would tell the truth to you? Well, the game is over.

“Men are so happily absorbed in their own affairs and indulge in such self-deception that it is difficult for them not to fall victim to this plague; and some efforts to protect oneself from flatterers involve the risk of becoming despised.”

If you’re a leader? Being despised is the end.

Chapter 25: Fortune

Here Machiavelli starts looking at risk. Here’s a rough passage, if you’re a feminist:

“It is better to be impetuous than cautious, because fortune is a woman; and it is necessary, if one wants to hold her down, to beat her and strike her down.”

Well.

Anyhow – Machiavelli makes a great point: risk is not an enemy. Risk is risk. And when you’re in a risky situation at work, why not take it up a notch?

Actual story: I knew that my boss had interviewed (don’t ask me how) someone for my position. At the next available opportunity, I asked him about it.

I’ve never enjoyed a work situation more. “How did you know?”

My response: “If I told you, would you ever trust me with a secret?”

The look on his face was priceless.

When you have nothing to lose? Doubling down is for sissies. Go all in.

Remember this:

“If an injury has to be done to a man it should be so severe that his vengeance need not be feared.”

‘nuff said.

Karma May Not Be Real . . . But, Seriously, Why Would You Want To Mess With It?

“But not this time, this is our time. This time you gonna hand them a business card that says I’m a CEO, bitch. That’s what I want from you.” – The Social Network

Your Dogma caught my Karma . . .

My first month on the job (when I graduated from college with a Masters) I travelled around to several of the company’s remote offices. They had offices across the country, and at that time I think they had some sort of operation in 35 of the 50 states (57 if you count Texas as many times as they think they should be counted). One of my first trips was to Central Midwestia – the rustbelt. And our facility was right in the middle of the rust belt. Across the street there was a stamping plant that continually (and very audibly) stamped auto parts out of glowing steel. To the north there was a sausage plant. To the west was a manufacturer of household cleansers. Many of the factory buildings looked to have been built prior to World War I, and some of them looked like they had been through World War II or even the Great Sitcom wars of the early 2000’s. Still bits of Futurama® on some of the walls.

The facility there was . . . everything packed into the size of a postage stamp. There were areas of the facility that if you had a sandwich for lunch you couldn’t gotten through because your belly would have been too big. And the electrical system? It looked like it had been thrown together on a Hollywood set so you could channel lightning into a monster to have it live . . . again.

What an experience!

The next month, I had the opposite experience at another one of “our” (I don’t work there anymore) facilities. Even though the facility had been open (in one form or another) since the Civil War, this facility, though old, was spacious, with plenty of room for moving around. The primary purpose of my visit was to work on a problem that the facility manager was having, so, after talking about the issue and looking over the beautiful Atlantic bay that was right next to the facility, we decided to go to lunch. The Salesguy, sensing a free lunch (I think they have radar) tagged along.

During lunch we talked about lots of different things, like how lobster stew there was cheaper than a hamburger. Also, as a new guy to the company they each had really interesting stories to tell the new guy (me). The conversation drifted to the places I’d visited with the company so far.

Wee John Wilder: “Well, I did see our facility in Central Midwestia.”

Salesguy: “What did you think of that?”

Wee John Wilder: (Pause) “I think that whoever set up that facility had one of the biggest challenges of a career. I have no idea how they fit all of that stuff into that space. My hat is off to them.”

Sure, I could have called the place a mess, but it really wasn’t – I’m not sure anyone could have done better putting all the parts into place.

The next morning when I got to the facility, Salesguy wasn’t there, but he had left me two boxes of golf balls (good ones) with the company logo on them, along with other swag he normally gave to customers.

“Wow! This was nice of him!”

The facility manager then explained that Salesguy had been the person who had put that facility in Central Midwestia together – and he’d spent months of his life making it work, but most people had called it a mess. Karma . . . doesn’t always mean that bad things happen.

Fast forward to last year:

I was on the phone talking to a friend that works at another company about a year ago. The CEO (at my friend’s company) had just announced his “retirement”. He hadn’t been talking about retirement, so the corporate world knows that “going to spend time with family” also means . . . “got fired”.

There had been some other recent changes as well at that company – the Chief Sales Guy (I don’t remember his actual title) had recently quit. That was fairly surprising, since Chief Sales Guy had been at the company since it was founded. The Chief Sales Guy was friends with the owner of the company, and had even suggested a possible replacement for his position as Chief Sales Guy to the owner.

Since The Mrs. had met the now fired CEO at a party some years ago, when I got home I mentioned the news to her. Her response was immediate: “Oh, the Secretary got him fired.”

The Mrs. is a writer of novels, so I asked her to explain this particular plot.

“Well, you remember that you told me about secretary, right?”

And then I remembered. The Chief Sales Guy had an executive Secretary that been with him for over a decade. After he left, that Secretary was blended into the pool of lesser secretaries on the floor. One Thursday afternoon, she had tickets unexpectedly fall into her lap for a literally “once in a lifetime” adventure (it was Elton John© performing the “Best of” Metallica™ with backing vocals by Katie Perry® and the Mormon Tabernacle Choir©). The Secretary was supposed to work until 5pm, but would have preferred to leave about 15 minutes early to get ready. This would have been fine with her old boss, so she found another lesser secretary who could cover for her.

But the person who could cover for her went to the “Jabba The Hutt®” of secretaries (her new boss), who didn’t like this impertinence. So, even before the Secretary could go and ask Jabba© for permission, Jabba™ had gone to complain to the CEO. The CEO fired the Secretary on the spot.

Fired. On the spot. For wanting to leave 15 minutes early. Yeah, true story.

The Mrs. reasoned that the Secretary had mentioned her woes to the former Chief Sales Guy.

The Chief Sales Guy went to the owner and told him the story. The owner, in the narrative favored by The Mrs., fired the CEO a week later, after he’d found a replacement.

I have no idea if this is true or not, but it really makes sense.

Everybody answers to someone, even the CEO. Oh, sure the CEO retired with $100 million or so, but I bet the Secretary enjoyed the afternoon she found out that karma had scored just a little revenge for her. Me? I’d have smoked a cigar and had a nice scotch. Bet she had a Margarita on her deck with copious middle fingers for the CEO.

Your career will likely be a long one – 40 to 50 years for most people. You will meet people on the way up, and you will meet people on the way down. You alone control how you act and how you treat people. Being nice is a choice. Being a jerk is a choice. Why would you ever choose being a jerk? Why would you, as CEO, choose to fire a secretary for wanting to leave 15 minutes early on a Friday?

I’ll note that being a jerk isn’t the same as being honest. Don’t lie. Why does The Mrs. never ask me “does this outfit make my butt look big?” Because if honesty counts against my karma scores . . . oh my.

But Texas will be fine when it comes to karma. They have no idea that when hurricanes hit them it might be karma. Texans? They just want to put a saddle on the hurricane and ride it on up into Iowa so they can take that over, too.

Most of the People at Your Company Know Nothing, John Snow. And You Can’t Fire Them.

“He was poisoning me? It was all there in the job title. The head of Human Resources. This time, it’s personnel.” – Dr. Who

Umm, I can’t top this.

I’ve posted before about how government is a jobs program (LINK), but increasingly government has made businesses hire more and more people that produce nothing in order simply to meet government regulations or to fend off lawsuits. It’s like welfare, but with the whole, “you mean I have to be there at eight . . . am?”

Think I’m kidding?

Let’s start with Human Resources. I love the title. HR. Every company has someone who does this, right? The title makes me think they go to a mine and take a pickaxe and look for bits of people that they can assemble into Frankenployee.

I’m wondering where I go to complain about the other employees and their “made from living tissue in a normal manner that doesn’t insult God” privilege?

Well, what’s the problem with HR? They’re there for their workers, right? (Notice the They’re, there, their trifecta!)

Let me tell you a story that I’ve seen unfold several times during my career.

Person A, unhappy about employee favoritism, to John Wilder: “I’m so angry, this isn’t right! I’m going to tell Human Resources!”

John Wilder: “Umm, dude, Human Resources reports up to the President. They are not on the employee side, they’re on the company side.”

Person A, after talking to HR: “They asked me if it was sexual harassment. I said “no.” Then they said they didn’t care – quit whining.”

If your boss treats you poorly, and fires you, and is wrong in every way possible from being rude to being born as ugly as a cross between a turkey and a cat, Human Resources is . . . on their side. As long as he doesn’t take a fire axe and try to kill you at your desk – they’ve got him covered. “Unconventional leadership! Attempts to motivate by leaving a dead rodent in their tea! Didn’t actually kill employee!”

The only way to get Human Resources on your side? Own the company.

Sure, HR helps with finding and hiring people, but that’s primarily so the hiring manager doesn’t screw up and create legal liability by asking the person being interviewed if they’re fat or pregnant, then telling them they must be fat, because they’re too old to be pregnant. HR tells them not to do that. But if they do it? HR will defend you (if you own the company).

HR also helps with setting up employee benefits. Yup. Employee benefits still exist in some places – they’ve not vanished, but they are as rare as a coelacanths. (pronounced see-lo-can-thhhhhhhhhhh)

Yeah, coelacanths are almost as old as your mother. And what would Mom say? Don’t be a coela-canth, be a coela-can!

Let’s pretend that businesses didn’t have to pay taxes. What then?

Well, your accounting department would shrivel – and not the individual employees shriveling so all seventy could fit into a filing cabinet (though that is amusing). You’d only need the accountants that sent the bills, paid the bills, and then do whatever reports you wanted and maybe a couple to make sure employees aren’t stealing too much from you. Sure, it’s important to know why your company makes money (don’t laugh – there are some companies, profitable ones – that have no idea how they make money) and the accountants can be sent out to find which parts of the company cost more than they make, but the current sea of accountants that are devoted to taxation and special treatment of the way the company spends money so it can conform to what the government wants? Yeah, they could go away.

Thankfully, Big Brother Government will never let this happen, though, due to public safety concerns. Nobody wants that many introverts walking around the streets staring at their own shoes. The poor dears would get run down right and left. And how would we pay for cleaning up all the accountant blood off of our cars?

Next victim? Investor Relations folks work with the company lawyers to help the Securities and Exchange Commission (SEC) pretend that they know what a business is when Congress calls them and invites them to come and talk. Congress then kicks them a few times to show them who is boss, and then sends them back to do exactly what they previously did before they got yelled at.

In reality Investor Relations fills out forms and does annual reports. The purpose of the annual report is so that the CEO can show off how much he cares and about the new charity hospital the company set up in Belgium. Why Belgium? Your CEO thought Belgium was in Africa.

Don’t let the Legal Department reproduce, or your company will have three lawyers for every person engaged in productive activity. It’s like that movie with the aliens with the seed pods. But in this case the seed pods just turn into more lawyers.

Every industry in the United States has “Industry Regulation Experts.” Things that a farmer can throw on a trash-heap in his north 40 are (sometimes) things that a chemical company would get fined for even thinking about purchasing since hazardous waste is the in the eye of the beholder.

(True Aside: There are two kinds of hazardous wastes under Federal law: listed and characteristic. Listed is just because an unelected regulator put it . . . on a list. Many of these items make no sense. But characteristic is funny. Originally EPA was gooing going to set characteristic hazardous wastes as those with a pH less than 3 (that means it’s an acid). OOOPS! Coca-Cola™ has a pH of 2.5. So they set the pH of a characteristic hazardous waste at . . . 2.

Let’s go to bases/caustics. These can still burn you. So, the EPA decided that we’d set a limit of 12. Again . . . OOOPS! Wet concrete has a pH of 12 to 13. So, they set the pH for a hazardous caustic waste as . . . 12.5.

Government is stupid, but not stupid enough to outlaw Coke® and concrete.)

Food production people in California have vastly different regulations than a similar company in Utah might have. And as government finally comes around? Tech companies will soon require hundreds of extra personnel just to sit in your office to tell you why you’re not allowed to do.

Thankfully, there are companies you can hire to do everything we’ve talked about. You can outsource accounting, payroll, HR, and even legal. Groups of consultants know your business better than you.

Rob Halford knows HR and Legal says you’re not supposed to mix Judas Priest® and Babymetal™. But Rob doesn’t care . . .

It’s my theory that our country could be as productive as a boxcar filled with kindergarteners that just had sugar cookies after trick-or-treating. We just need to get everybody rowing and we’d be on Mars in two years.

If not rowing? At least tell them about our new colony on Venus! We’re shipping out new colonists starting every Tuesday!

Found at (LINK). Story “Marching Morons” can be found at (LINK).

Taxes, Charity, Morality, and the Immortality of Keanu Reeves

“You can feel it when you go to work, when you go to church, when you pay your taxes. It is the world that has been pulled over your eyes, to blind you from the truth.” – The Matrix

I’ve always wondered what clothes cost in The Matrix. These three could have told me, but I forgot to ask them before I moved away from Alaska.

I’ve just finished stapling my tax return together for the year 2017. Why did the tax return cross the road? John Wilder stapled it to the chicken.

I can’t (generally) do my taxes before the first week in April because, like Ben Franklin said, the only two certain things are death and taxes. And I’m certain I like to wait, because:

I’m lazy and
I don’t get all the information for one investment until mid-March.

I really hate doing taxes, but, thankfully, an entire tax software industry exists only to allow us to do them ourselves on a Sunday afternoon. Yes. I started on Sunday afternoon after I’d taken one of the cars in to get fixed. As in today. I’m not only lazy, I do everything I can to put off taxes to the last possible minute.

Generally, as the envelopes with “IMPORTANT: TAX INFORMATION” show up I clip them all together and pretend they don’t exist for 70 or so days, so I’ve been preparing for doing the taxes for a while. My information isn’t all that complicated, so I’ve managed to do it myself for, well, ever.

fluxcapacitor

Taxes are more complicated than time travel or Doc Brown’s hairstyle.

How does doing taxes change my mood? The Mrs. says that I have three personalities, and generally, she’s right:

Juan Délegator – Juan is general me around the house. My general motto is: if someone else (like my kids) can do it, they should do it. Why? To make them capable. No, I won’t make them run 480 volt 3-phase power to my flux capacitor, but I will make them do dishes. And I will make them do things that they are capable of and uncomfortable with. Why? So, like Conan, “they will be strong when the wolves come.” Juan is pretty easy-going. And why not? The work is getting done.
The General – The General is like Juan, but The General comes out when time is of the essence – like our house is going to catch on fire due to my poor wiring of the flux capacitor. The General is commanding, and expects immediate obedience and compliance, due to the consequences of not taking that immediate action. The General doesn’t care how you feel, but wants to end the emergency as quickly and as efficiently as possible. Movie reference: The Wolf from Pulp Fiction®.
The Nazi – The Nazi is like The General. But isn’t having fun. And The Nazi kind of wants you to suffer. Only one thing (really) brings out The Nazi (anymore).

wolf

Me when I’m enjoying myself the most . . . fixing bad things in a hurry. Pretty please.

This year (I have to say) wasn’t that bad. Most of the time I get worried that, since I’m doing the taxes on the last possible day prior to them being due, that I’ll find myself without some key piece of information.

Not this year. I have it all, or I did after I looked in a stack of papers on the bedroom. Whew.

So, I entered the information required by the program.

And this year TurboTax® downloaded my work information directly from my employer. Also nice. Not that I’m a huge fan of TurboTax© – they are, at best, a necessary evil. Doing a meaningless task well is still meaningless. Without taxation, fully 20% (my guess) of the economy could be used for more productive things . . . overnight. TurboTax© programmers could program video games. Or something. The IRS™ could do what they would naturally aspire to do, form covens and attempt to steal souls actually produce something in the economy.

And the process of doing taxes today are (largely) meaningless for the average taxpayer. For the average payer, the IRS already has all of the information necessary to send the taxpayer a bill. They already know my income. My interest payments (to and from me, which are getting closer to equal!) and they know how much I made (or lost) off of my stocks. They know if I bought or sold a house.

But the process of taxes is, at least partially, immoral.

Yes. Immoral.

Let me tell a story . . .

paytaxes

I used to go to church when visiting Pop Wilder – it was the same church that I’d grown up going to coloring pictures of Jesus. True conversation, from when I was about five:

Sunday School Teacher: “Johnny, Jesus wasn’t purple.”

Little Johnny Wilder: “Isn’t Jesus God?”

Sunday School Teacher: “Yes, He is.”

Little Johnny Wilder: “Then he could be purple if he wanted to be.”

It was a small church in a small town. Pop would go every Sunday, and when I was around, I’d go with him. One morning, the Pastor gave a sermon that made my circuits pop.

He used the concept and example of Christian charity in his sermon. But in every verse I could find, that charity referred to voluntary giving. Here? The Pastor was wanting to have increased taxpayer spending going to the poor – and indicated that, somehow, this equated to charity.

I sat on the pew, seething, which, generally isn’t very appropriate for a church, but neither was his sermon, which violated the following principles:

Taxes are forced – there’s nothing moral about them.

Charity is given of free will – there’s no coercion other than moral coercion. You have to make a choice to give to charity.

And that’s what made me mad. Charity – the act of giving time or money to someone else, is important for the soul. Government services have nearly completely destroyed the idea of charity – why help the homeless? Government should be doing that. Why feed hungry children? Government should be helping them. Folks drowning in Canada due to all the hockey rinks melting? Government should fix the rinks, because Canadians can’t swim!!

Since government is already fixing the problem people don’t think that there’s the need for charity. Since I already give federal, state, and local governments over 45% of my income directly, and indirectly pay for the corporate income taxes on every item I buy and Social Security kicks on another 15%, I figure the government is already into me for 65%-75% or more of what I make.

That thought doesn’t leave me feeling charitable. And that’s the immoral part. Giving charity makes me a better person, inside, where it counts. Feeling uncharitable because my money has been forcibly taken from me and to (many people and groups) that I feel undeserving, well, that’s immoral. Charity is good. But Jesus certainly didn’t say, “Go forth, and haveth ye government arresteth ye brothers and ye sisters who give not 75% of yon incomes to others.”

And I didn’t feel charitable when the Pastor was asking the congregation to take more of my money. Honestly, it’s not greedy to want to keep some of your money. But I feel that there is truly nothing greedier than asking forcing others to pay for things that you want to do, but don’t have the money for. I mean, I’d love to have a great treehouse, complete with air conditioning and plumbing.

taxesswanson

Now there are legitimate reasons for taxation – common defense. Courts. Common infrastructure. But there isn’t enough money in the world to pay for everyone’s “needs” – and payment for everyone’s wants would bankrupt the planet.

Taxes were complicated this year. The parts that I have to file and send are about 40 pages, but I’ve learned printing off the federal and sending them to the state makes life easier. By the time that I’d printed the copies I’ll send plus the spare copies, I had printed out 160 pages. I’ll send 120 pages out, plus a pretty big check. I don’t mind sending 120 pages out, or even the check. Heck, all the dollar bills I have say they belong to the Federal Reserve® already, right?

refunds

No refund. But I won’t burn the place down. Or try to get my stapler back.

I’m just sad that they make us pay taxes in the Matrix. But, the clothes don’t cost all that much here . . . .

neoforever

And Neo lives forever. I guess the whole “Death and Taxes” must just be . . . taxes.

College is Expensive and Your GPA is as Inflated as an Instagram Model

“But you can’t hold a whole fraternity responsible for the behavior of a few, sick twisted individuals. For if you do, then shouldn’t we blame the whole fraternity system? And if the whole fraternity system is guilty, then isn’t this an indictment of our educational institutions in general? I put it to you, Greg – isn’t this an indictment of our entire American society? Well, you can do whatever you want to us, but we’re not going to sit here and listen to you badmouth the United States of America. Gentlemen!” – Animal House

Pugsley climbing a climbing wall. Not pictured: college degree he earned.

Last week we reviewed how college may provide (does provide) a lot of poor choices for student degrees – essentially you can get a degree that’s not worth very much to any employer. But, thankfully, in an era where I can look up the most obscure facts online, I can count on college being cheaper now?

No. It’s more expensive than ever.

Huh? You have a service that more people are requesting, one that’s essentially unlimited since Wikipedia® is free, and the prices go up?

Yes. But Wikipedia™ does not have climbing walls.

At least colleges are paying more for instructors/professors, right?

No. Colleges are increasingly pushing instruction onto “adjunct” instructors. These adjunct instructors are generally paid in PEZ® and pity. If the college feels guilty, it leaves a little extra on the nightstand in the morning.

How much have prices gone up?

Prices have gone up everywhere, but let’s pick Harvard™. In 1970, Harvard cost about $4,000 a year for tuition. Not bad? Well, the median family income was about $10,000 back then, so, not so bad. If you hustled you could (with a small scholarship and working a pizza delivery job) make it.

Harvard now costs over $43,000 a year. Median family income is closer to $60,000 a year, so prices (in terms of a family income) are up over 180%. But Harvard® has literally billions of dollars in a cash horde that the administration rolls in when they can’t get enough sleep. Other colleges have gone up more. Much more. One state school has gone up (since 1980) from $6,000 tuition to $40,000. This is more than Harvard’s 180%, but I won’t do the math because I’m feeling like I don’t want to. Oh! The solution is left to the student! Yeah, that’s what the books said . . .

So why are prices going up?

One theory, and it’s a good one, is student loans. Student loans were created as a mechanism to trap young people into debt before they can legally buy whiskey means to allow anyone to go to school as long as they were willing to borrow enough money.

Student loan debt is the very worst kind of debt I know of that doesn’t involve a blood oath with the Mafia. It is the herpes of debt.

Just like herpes is incurable and makes you (when disclosed) a lot less attractive to the opposite sex (or same sex, or whatever combinations including androids that are possible in California) student loan debt makes you less attractive. And you can’t declare bankruptcy and get out of student loan debt. Again, like herpes, it’s forever. Unlike herpes, you can pay your debt down to zero.

But you should avoid both of them, if you can. Debt, especially student loan debt, will outlast your mortgage. I bought and sold four houses, three unicorns and one wife before I paid off my student loan.

I met him. Nice guy. But he never did a song about a unicorn or a Pegasus.

But why would student loans cause the cost of college to increase?

Simply put, there’s more money available? The colleges most exposed to student loans increased their tuition the most. Quite simply – tuition expands to consume as much money as you can feed it. There’s a pretty comprehensive study that proves it – you can find the info here (LINK). What, am I supposed to do all of your research?

So where is the money going?

PEZ® for the adjunct professors? No. Administrators. I’ve seen this before in other organizations that aren’t subject to market punishment (like, say, your friendly federal or state government or school district). One administrator has a job. It’s not a hard job, but it’s his (or hers). They are paid, at least partially, on the number of staff that they have. So, they get approved positions for “essential” work. Soon enough, a job that was barely important enough for one person is now down by a staff of thirty. (This tendency will be discussed again in a future post, and was discussed in “Government is a Jobs Program here (LINK).)

Professor Doom is a very good writer. His blog is “Confessions of a College Professor” and I strongly suggest that you read it, especially if you are certain that colleges are bastions of honor, learning, and goodness. Recently, the learned Professor had a post where he described that at Evergreen College in Washington State, that there is one administrator for every six students. I kid you not. Here’s the link (LINK).

But the education is better, right?

Again, I’ll have to defer to Professor Doom. He writes again and again how grade inflation has taken off (LINK). I tried to find his post about how, due to a computer error, bunches of students at a school he was at were signed up for a class AFTER they got their schedules.

When this error was discovered at the end of the semester, fully a third of students (who had never attended class) had an “A” in the class that they had never been to and weren’t aware of. Yeah, you read that right.

In at least a third of your classes, you never need attend and you’ll pull an “A”.

Wow. That’s not really education at all, except maybe in the “son or daughter of a President or Senator who gets on a corporate board of directors because they can fog a mirror” way.

Why?

On snowy day a long time ago I decided I wanted to teach. A new college had come to town – I had never heard of it, “University of Phoenix™.” They put an ad out looking for faculty, and I sent in my résumé. Or rësümë if you’re in a 1980’s hair metal band.

Well, in the 1980’s I had hair . . .

I got an immediate call back. Pretty soon I was in “New Faculty Training” – which included a batch of people with master’s degrees. Most of us had teaching experience at the undergraduate level – that was, back in the day, how you paid to go to grad school.

We sat in a circle and discussed how to teach at the University. We would get stock options if we did well. The curriculum was set, and it was explained to us that the students were often working. And had a tough time. So we shouldn’t treat them exactly as students.

Think of them as customers instead, we were told.

So, what if a student never came to class?

“Well, they’re paying for it, so, it’s not a problem.”

What if a student didn’t turn in an assignment?

“You should give them a chance to turn it in late – they might have had a sick kid.”

One of the prospective faculty got pretty blunt: “So, we shouldn’t flunk them?”

The leader of the orientation paused. “Well, not if you can help it.”

So, a course you didn’t have to show up for, you could turn in assignments late, and would almost never flunk? That sounds like the state of higher education today.

Was it a smart financial move? I just checked. I wouldn’t have been a billionaire if I would have stayed with them. So, whew.

What happened, John Wilder?

Prior to our current generation, college had been about the reputation of the institution and the graduates. If you were a Harvard® man or a Vanderbilt™ grad, that meant something. Not only was the curriculum difficult, but you only had a very small chance of even getting into the place.

The reputation of the school was that it was difficult – only the best should try to get in. Only the best will succeed. The often repeated story was of a Dean getting up before the freshman and saying, “look to your left . . . now look to your right. Only one of you will be here in four years.”

That was something they were proud of. If you didn’t dig in and study, well, you’re gone. That enhances the value of the school’s name.

This was important. The school would rather eat a kitten (an actual, living kitten without condiments like creamy horseradish sauce that go great with kitten) than put a graduate out that wasn’t up to their standards.

Now? Students are “customers” and the administration wants as many of them as possible so they can spawn a never ending series of administrator clones (college administrators reproduce asexually) to bring into the college administration. They don’t want to kick a student out, because that would mean that they would lose the precious, precious money that the student brings in. So they need things to attract more customers. Like elephant rides. Free panty hose. Margarita Tuesday.

Oh, did I mention that our college has climbing walls?

2018 Wealth Predictions: 1st Quarter Update

â€œBattalions of Orcs are crossing the river.Â lt is as the Lord Denethor predicted.â€ â€“ Lord of the Rings

Two million dollars? Â Some people donâ€™t make that much money in a whole year!

I promised a quarterly update on my Wealth predictions for 2018.Â So, here it is.Â So far, Iâ€™m doing okay.Â Weâ€™ll check back in June to laugh at the how things have gone off the rails.

Bitcoin

Bitcoin is the ugly stepbrother of currencies.Â Or itâ€™s CinderellaÂ®.Â I categorized the risks previously:

It (may) be vulnerable to hacking since itâ€™s based on an NSA product â€“ there may be hidden back doors.
Wal-MartÂ® doesnâ€™t take it.
Itâ€™s as volatile as a bi-polar ex-wife on meth.

New Risks since December Prediction:

The IRS has categorized each Bitcoin transaction as a taxable event.Â Yeouch.Â Nobody keeps those kinds of records, and that is an absolute block for people wanting to use it like youâ€™d use a dollar bill.Â That moves it from a currency to an investment vehicle.Â Use as a currency inherently raises the value of Bitcoin, but this moves it away from that.

My prediction in December:

â€œI think it might have more to fall before it becomes stabilized, maybe to $10,000.Â But I predict it would be higher than $20,000 next December.â€

First Quarter Scorecard:

Howâ€™s that working so far?Â Bitcoin dropped to my $10,000 number and kept right on going until it hit $7,000.Â Recently, itâ€™s been bouncing around my $10,000 prediction for the stabilization number.Â Is $20,000 still possible?Â Sure, but less likely if itâ€™s harder to use as a currency.Â I would change this one if I could (note:Â The Boy has partial Bitcoins I wonâ€™t let him use, due to the taxable thing.Â Irony:Â He paid a bitcoin for some hosting about 5 years ago.Â Yeah.Â $10,000 for internet hosting.)

The Stock Market

In December I said:Â â€œThe biggest risks are North Korea, Iran, and Saudi Arabia, with anything that created higher oil prices being the biggest risk.Â Chances of impeachment this year?Â Nearly zero.â€

New Risks Since December Prediction

Democrats taking the House of Representatives in November â€“ this is a risk because it greatly increases political uncertainty. Again, impeachment this year is nearly zero probability.Â In 2019 with a Democratic House?Â Low, but non-zero.Â Thatâ€™s a huge risk the market has not priced in.Â October will be the most volatile month this year, if the Republicans keep the House.Â If they lose the house â€“ November will be a very difficult month in the Market.Â But if Pelosi keeps talking â€“ the Republicans have nothing to fear.
How much will the Fed increase interest rates (see below)?
Is FacebookÂ® in trouble for data? Facebookâ„¢ might be the spark that melts the market down . . . or not.

2018 Prediction on the S&P 500:

â€œUp.Â Not 24%.Â But up, say, 10%.Â 2019?Â Weâ€™ll see.â€

First Quarter Scorecard:

So far, year to date, itâ€™s up 1.01%.Â Seems in line with my prediction (so far).

Interest Rates:

Weâ€™re recovering from the longest period of low interest rates in history.Â All of history.Â It really wonâ€™t make a difference, but the Federal Reserve simply must increase rates so that we can pretend that the money isnâ€™t all made up.Â Eventually if thereâ€™s a credible alternative (Bitcoin? Swiss Francs?) the Federal Reserve will have to raise interest rates . . . a lot.

If itâ€™s too much this year, weâ€™ll enter a recession â€“ maybe right away.Â I donâ€™t think thatâ€™s likely in 2018.Â Trumpâ€™s Fed chair will want to raise the rates â€“ after this election.Â Maybe right after, so the economic pain is over and done with by the 2020 election.

2018 Prediction on the Federal Reserve Rate:

â€œUp slightly.Â Eventually (2019, 2020?) up a lot.â€

First Quarter Scorecard:

Zero change in the Fed funds rate.Â Mortgage rates have gone up from 3.95% to 4.46%.Â Not a lot, and not even a record number for the last decade.Â Seems in line with my prediction (so far).

Gold/Silver:

2018 Prediction on the Gold/Silver:

â€œMeh.Â Wanders back and forth.Â Probably ends the year +/-10% of where it started.Â 2019 or 2020 might be different stories, and longer term it will still experience huge upward swings during times of uncertainty.Â It appears weâ€™re currently at the â€œno crisisâ€ pricing, which would probably be a good time to stock up.â€

First Quarter Scorecard:

Gold is up 1.8% in the quarter.Â Silver is down 3%.Â Itâ€™s wandering (for now), so itâ€™s in line with predictions.

Please note that when a stock market crisis hits (not if, but when) ALL asset classes will drop in price (except for food and ammo).Â Thatâ€™s generally a great time to buy gold.Â If itâ€™s an inflationary spike?Â Yeah, youâ€™ll be too late for the party â€“ people will dump dollars to buy commodities like gold.

Disclaimer:Â I havenâ€™t started any positions in anything above the last three days and donâ€™t expect to start any in the next three.Â So there.Â Also, Iâ€™m not a financial advisor, and this set of â€œpredictionsâ€ is probably as good as a blank OuijaÂ® Board and probably worse than flipping a coin.

Stoics, Fight Club, Wealth, and Virtue

“I had it all. Even the glass dishes with tiny bubbles and imperfections, proof they were crafted by the honest, simple, hard-working indigenous peoples of . . . wherever.” – Fight Club

The first rule of Fight Club is . . . be older than six. And no swords.

Wealth – what is it?

Is it:

Something that we sacrifice our lives for?
Something we obsess about until it controls us?
Something that is never . . . quite enough?
Something we have to have more of than our neighbor?
Something that defines our feelings about ourselves?

I’ll be honest, but there have been times I’ve viewed wealth in more than one of the categories above and acted as such. “Wealth consists not in having great possessions, but in having few wants,” is what Epictetus wrote about 100 A.D. Even more succinctly, Tyler Durden said in Fight Club, “You’re not your job. You’re not how much money you have in the bank. You’re not the car you drive. You’re not the contents of your wallet. You’re not your (gosh darn) khakis.”

What Epictetus may have looked like. If he were in a comic strip.

I may have it in for Johnny Depp, but Brad Pitt’s Tyler Durden is my spirit animal (we’ve started a tiny Fight Club in my basement, but I’m not supposed to talk about it – first rule, you know).

I keep coming back to the stoics. What did Seneca, Marcus Aurelius, Tyler Durden, and Epictetus think about wealth? The website How To Be A Stoic says (LINK): “. . . they classed everything that lies outside of virtue as either preferred or dispreferred indifferent. To the first group belong things like wealth, health, education, and high social standing; to the second things like poverty, sickness, ignorance, and low social standing. These things were preferred insofar it is normal for a human being to pursue them because it makes her life more comfortable, and dispreferred insofar it makes her life less comfortable. But they are “indifferent” in the sense that they are irrelevant to our ability to exercise the virtues . . . .”

So, the Stoics were indifferent to wealth, but it was better to have it than not. You could be virtuous and poor, or you could be virtuous and rich. If you were rich, perhaps you could share your virtues even further than if you were poor – so it was preferred to have money. And Marcus Aurelius was emperor – it was hard to be richer than that, even for Jeff Bezos. Seneca? He was really wealthy, too. And since they are some of the thinkers that literally define what Stoicism is, well, wealth and power isn’t off limits, but the goal was to live a virtuous life.

So what does wealth signify?

Mostly, wealth is like stored energy – it’s a potential. A child may have a wealth of days before it, and an old miser a wealth of cash, cash that he might trade every dime of for just one more taste of youth. And a six year old would trade the ages of 18-30 for six Cadbury Cream Eggs®, which is another reason that kids can’t vote.

Steve Jobs certainly traded some of his wealth for additional days of life without having to cheat a six year old in a candy deal – he could honestly say he could be at any liver in just a few hours (having a private jet and all) and he could afford to have a staff of people looking for ways to improve Steve’s chance of getting one. Heck, Apple® has a project to clone Steve from a clump of his cells that they found in his comb – they just keep getting Ben Affleck copies instead. Thankfully, Ben Affleck is not considered by the state of California to be a “living human.”

Choices. Wealth buys choices. And one of the choices is always . . . not choosing right now. The wonderful thing about being rich, is you don’t take any offers you don’t want. If have to sell my car – I need the money for a new kidney for my Yosemite Sam© PEZ® dispenser, well, I have to have that money now. I can’t wait. I have to take the offer I get now.

If I have wealth and can afford to buy new, black market PEZ® kidneys for cash? Well, I don’t have to sell my car. In fact, if I have cash, I can look for people who have to sell kidney cars for PEZ© kidney cash to get a bargain.

I am willing to bet a large amount of PEZ™ that this is the first time the last sentence has been written in any language.

Anyhow. Wealth buys choices, and wealth creates the conditions for more wealth.

But what creates wealth? Well, in reality – the same virtues the stoics upheld (from the Internet Encyclopedia of Philosophy – LINK):

“The Stoics elaborated a detailed taxonomy of virtue, dividing virtue into four main types: wisdom, justice, courage, and moderation.

“Wisdom is subdivided into good sense, good calculation, quick-wittedness, discretion, and resourcefulness.
“Justice is subdivided into piety, honesty, equity, and fair dealing.
“Courage is subdivided into endurance, confidence, high-mindedness, cheerfulness, and industriousness.
“Moderation is subdivided into good discipline, seemliness, modesty, and self-control.”

If you will look – many (but not all!) of these virtues, if followed well and long enough, will lead to . . . wealth.

But perhaps Epictetus was right: “Wealth consists not in having great possessions, but in having few wants.”

And then there was Tyler Durden: “It’s a blanket. Just a blanket. Now why do guys like you and me know what a duvet or a comforter is? Is this essential to our survival, in the hunter-gatherer sense of the word? No. What are we then? We are consumers. We’re the byproducts of a lifestyle obsession.”

So, be virtuous. Get wealthy. But don’t make the wealth the focus . . . it’s not the money, after all – it’s all the stuff.