Tuesday, March 24, 2009

Too much freedom can be a curse!

As we old gits tend to do, my mind recently wandered back some 40 years to my days at Ft Wolters, Texas. One of the finer pieces of wisdom I received there was from the base pediatrician. He wrote a great series of parenting pamphlets, and in one, he addressed the subject of offering choices to our young ones.

His sage wisdom? Limit the choices your child is offered, and once they decide, hold them to it. His logic? If offered unlimited choices, one has great difficulty in evaluating them all to make a sound decision. Further, life will indeed involve limitations at times, and the sooner we learn this, the better we will be able to deal with it.

Thus, he said, rather than asking your offspring the seemingly innocuous question, "What would you like for dinner tonight?", he recommended offering a choice between two selections, one of which would be served to the whole family. Further, he said that such decision making should not be offered every night, but just often enough to involve the child in occasional family decision making.

In broad terms, the good Doc summarized that self discipline cannot be developed when we are allowed to be "children in the candy store with an unlimited allowance". (Credit cards were not in vogue at the time). And, he continued, the offer of limitless choices ultimately becomes a greater frustration when one suddenly bumps up against the notion of not being able to have all two, three or four that are "tied for first place". Doc posited that if the menu of choices is so expansive as to cause decision making to be virtual random guessing, no decision making skills nor sense of responsibility is developed.

If only the good Doc had been at the helm of our society the past 30 years or so. We are now at an economic crossroads where difficult choices need to be made, and all too many of us are angry for having to do so, no less unable to do so. The "all you can eat for $5 buffet" is closing, and no one wants to return to a fixed menu.

WASF

Al

10 comments:

Pluto said...

Want to or not, we are returning to the fixed price menu; and they've raised the prices since we last looked at it.

Applying your old Doc's wisdom, we're going to learn self-discipline the hard way. Speaking from personal experience, the school of Hard Knocks frequently gives a better and more thorough education than any classroom.

While I don't look forward to the experience in the slightest, it seems to me that this lesson is WAY overdue.

Publius said...

Well, Pluto, maybe YOU needed this lesson, but I sure as hell didn't. I got my lessons over the years while going through that school of hard knocks you so blithely reference. I always played the game straight up. I haven't done anything wrong.

Correction. In retrospect, it seems the only thing I've done wrong, not always, but too many times, is to believe.

No more. A cousin of mine, fellow named Jefferson, believed in periodic revolution as a means of cleansing the nation. He was right. Read the Declaration of Independence. We the people have been fucked by our overlords every bit as much as our forebears were. In fact, in some respects they had more freedom under the English crown than we do today.

I went to war for this country and ended up spending a lot of my adult life in its service. Tell me it wasn't all a fucking joke. This country is far worse off than it was when I entered the service back in the 60s. The past 40 years have been devastating to the very ideal of America. That ideal no longer exists. We're now just another banana republic. Don't think so? What would one term a nation where the working people put their futures and those of their children and grandchildren on the line in the form of direct taxpayer subsidies in order to protect rich people from their fuck-ups?

I don't care which party you like. One of 'em kind of likes the idea of jackbooted fascism, while the other leans towards universal love and flattening society to the point where everyone gets everything, no matter their contributions. Interesting thing about these parties. WE get all excited about the differences in the parties, but the fact is there is ultimately little distance between them. No matter the party, they're all essentially dedicated to enriching themselves and ensuring that other rich people are always comfortable and happy. And what makes rich people happy? Well, money. And power.

Unfortunately, even when they have money and power, rich people aren't happy. They always want more and more. It seems these people will never be happy, which is how we got into the fix we're in: they obviously just can never make enough money to be happy. They will continue to bedevil us with their addiction, which is far stronger than any heroin addiction. And this is why a revolution is necessary. It's now clear that they actually have to be broken and humbled in order for the rest of us to be able to live fulfilling lives.

But it's never going to happen, Pluto, so long as guys like you keep shouldering the blame. It's clear to me that we're a nation of self-doubters, always wondering what we've done wrong, rather than actually being honest with ourselves and pointing the finger at the truly guilty parties.

Oh, and don't give me any shit about all those people who over-extended, blah, blah, blah. They wouldn't have been able to do so if those fucking bankers and government regulators had been doing their jobs. We have laws, rules, etc., specifically to guard against human nature. The guy who took out the sub-prime loan? Sure, he shouldn't have done it. But how about the guy with a lot more education and savvy who threw the money at him?

wourm said...

Publius,

I don't think we're any worse off politically than we were pre-1970. Even then there were politicians that we idolized while they bent us over and had their way.

The difference now is an attitude of entitlement. Not just among minorities, but everyone.

These days people seem to believe they're owed a job. And once they get it they don't really need to work. Today we are lower class if we don't have a car. And we're only middle class if we don't have an oversized, overpriced SUV. Don't even get me going about the mcmansions that people 'own'.

I look back at my parents and grandparents, who agonized over any large expenditures. What kind of car can we afford? Can I spare the money to repair the roof? These days it seems we won't buy a house if it doesn't have a huge kitchen (that may never get used) with an island and granite countertops.

I've tried to teach my kids that they have to work for everything they get. I hope that some of it sinks in...

Maybe the times will help.

Publius said...

Wourm, you're fairly new to me and I haven't gotten a chance to "know" you as I "know" some of the others with whom I've been jousting for five or more years now. For example, I don't know your background, age or anything else about you. Not being negative here: just sayin'.

Those who "know" me know I'm pretty opinionated and not too inclined to put a shiny gloss on my opions. They also know I'm an old dude. In fact, I'd venture to say that were it not for Al, who's now become our host, and for whom I have a great deal of warmth, I might be the oldest dude hanging out around here. Thank God for Al, who, as I recall, actually piloted the first helicopter ever. Did I get that right, Al?

Having said the above, I'm going to disagree with you, agree with you to a point, and then disagree again.

First, I stand by my statement that everything was better up through the 60s. Not necessarily for me personally because I was spending too much time on the shuttle back and forth to SE Asia. Which, in hindsight and certainly even then, wasn't really a disaster. Funny thing about being a young man at war and being committed to what one's doing. Humans are weird. But the nation, even with the most controversial war of all raging, actually peaked in the 60s according to major indices of national wellbeing. That generation that came of age in the 60s was the best educated in history. Kids today aren't even in the same ballpark. It was also in the 60s and early 70s that incomes actually peaked; shamefully, adjusted for inflation, incomes for lower and middle-class Americans have been flat since the early 70s.

And you know what was really cool about the 60s (and early 70s, actually)? The American people actually drove two presidents out of office because of (1) policies; and, (2) criminal corruption. You'll never see it again, even though we've had since and will have in the future criminal presidents and presidents with seriously fucked up policies.

Note I didn't say the 60s was wonderful; I said the nation is worse off now than it was then. I stand by that.

Where I will agree somewhat with you, Wourm, is in those attitudes of entitlement. No question about that, but then, it's understandable and expectable in a consumer society that's done a very good job in improving the lot of the average citizen. And so far as all of those goodies people may now want, I say, fine, just so long as they can afford them. Which brings me to my other point of disagreement.

You come across to me as thinking that somehow we'd all be better off if we lived as our parents and grandparents did. Well, hey, I don't want to do that. Our parents and grandparents sure as shit didn't want to live like THEIR parents and grandparents and I know with certainty that my forebears wanted me to live better than they did. Fact is, I've done better in life (got better educated, made more money, etc.) than my parents, just as they did better than theirs. And just as I want my kid to do better than me. That's how it's supposed to work.

One quirk of mine is that I don't like the word "entitlement" in the context you used. That old "sense of entitlement" has all too often been used by those in power to keep others, e.g., minorities, etc., at bay, to keep them from sharing equally in the goodies. As I said, you're right about that "sense of entitlement" on the part of many who haven't earned it, but there are things that a healthy, adult society can do to address that.

First, the boss who tolerates the employee who won't work is an asshole. He's got the power. Why does he let it happen? If Army sergeants know how to deal with it, why don't corporate managers? I never put up with that shit from anybody who worked for me. People are empty vessels and they are products of their experiences. They have to be held to high standards if they are going to reach full potential and be productive members of society. Everybody has a sense of entitlement when they're young. It's up to those with the power to put them on the right path.

Same goes with easy credit, etc. Despite whatever sense of entitlement they may have, nobody who doesn't meet long-establshed credit guidelines can get a loan unless the green eye shaded guy across the desk, the guy with the money, gives it to him. I have purchased four homes in my life. For the first three, I had to sweat out meeting those traditional 28/36 percent underwriting guidelines, all designed to drive risk down. For the current house, I didn't have to, specifically because I put a very large chunk of cash into it. The green eye shade had a pretty good idea I wasn't going to default with so much of my own money invested. Plus if I did, he knew he'd end up making money.

ISTM, Wourm, you're doing what I called Pluto on. You're blaming the victim, those people whom you excoriate for a sense of entitlement. Human nature being what it is, everybody is going to want more than they can afford, especially in a land of such plenty as ours. It's up to the gatekeepers to enforce the rules. Sure, the guy who signed for the subprime loan was a dumbass, but what a lot of those dumbasses didn't know was that the guy across the table was getting filthy rich while he was putting them in the toilet. Those dumbasses didn't put guns to the bankers' heads to get those loans; they were believers in the system. Rather than being honest with them, those authority figures who embodied the system failed them. Just as it failed all of us.

Put the blame where it lies.

Aviator47 said...

Yes, Publius, I'm also an old git. My flight records display significant hours in helo's with wooden rotor blades, and even more in those with piston engines. You will also find some C-47 (yup, DC3) time, which led the young LT who closed out my records at retirement to think it was a typo Sir, C-47s were like -- WWII), as I was primarily a Chinook driver (CH-47) over the years. Didn't fly the first helo, but did watch the pilot preflight it.

Like it or not, being subject to parental oversight or it's subsequent societal equivalent (later) does not end at age 18, or whatever. In most responsible societal relationships, there is a hierarchy of responsibility. In mortgage lending, for example, the very nature of the lender having stewardship for the funds lent places the higher burden of responsibility there. The lender can and should have at his disposal all the metrics to determine if a certain borrowing situation is sound. That's why our society has lending institutions rather than open pots of money from which anyone can borrow. A few responsible folks provide sanity to the society at large within their delegated field of responsibility.

Those of us who have served in battle tend to see the reasons for this. A ship has THE helm, and a unit has THE commander, simply because the resources must be focused upon THE mission. The singularity of the definite article "THE" is profound. Responsibility and accountability must be fixed, or the result is chaos. While it might not always bring optimal results, it minimizes the probability for disastrous results. Even an orchestra of virtuoso performers defers to the conductor, regardless of his skill on an individual instrument. They know that there is a difference between an orchestral performance and cacophony.

wourm said...

Publius,

Some background on me: I lurked a lot at Intel-Dump (miss it big time), but only posted once or twice, anonymously. I've never been in the military so I felt my voice was only of marginal value there, but I've read a lot of yours and the other regulars' posts.

I turned 18 in '82 so I couldn't vote against Ronnie Reagan. Never did understand what was supposed to make an actor a good leader. I became cognizant of the political process during that election, of course through the rose red eyeglasses of youth.

On the present topic, I'll agree, I'm blaming the victim. I think each one of us needs to be educated, to stop an think before signing the mortgage papers. How many people do you know that figured a budget to find out how much they can truly afford. The victims need to be responsible for their actions.

You do make a good point, that the lenders bear responsibility. These are the people who went to school specifically to learn the inner workings of business and finance. They know what risk is. They should know the consequences of high risk.

Aviator47 said...

Wourm-

Yes, it would be nice for everyone to be well educated, but unfortunately, everyone isn't. Thus, many turn to "professionals" for guidance. You know, the people who advertise that they can assist you in getting the house of your dream, for example.

Ever been to an insurance annuity scam presentation for senior citizens? They have the audience "compute" their own needs, with a little help from examples close to their situation. They give the folks really professional looking computation forms and calculators, and walk them through this very impressive process of having people compute their very own personal annuity "needs". Actually makes the folks think that they learned how to compute the proper annuity for the future, and the logical course of action is to go ahead and buy. It's very persuasive and pervasive. And it's a scam that numerous states have prosecuted the companies for.

Yes, there were some who saw the loosey-goosey products available (no income-no assets, for example) and they took advantage of that to borrow what they might have known they had no business borrowing. But there were also legions of folks who were given a very persuasive pitch designed to make them seem able to afford the loans being offered. Either way, the lenders did not hold up their end of the traditional responsible lending model, and they were the ones putting the money at risk - other people's money. The lender's responsibility is not lessened by irresponsible borrowers when the lenders readily accept and/or promote such irresponsibility.

Al

Fasteddiez said...

Wourm:

I live in the OC, in California, home to many of the ex-mortgage schemers which brought about the real estate Imbroglio.

They called people on the phone (basically everyone who could pass breath), and told them they could qualify for a brand new home. Qualifications? Schmualifications!

Have you ever heard of a NINA loan? It stands for no income, no assets. Sometimes the paperwork was filled out with a widow woman's dead husband's salary as Income. This was set up as a scam from the word go, by the slicksters who studied the non-regulatory permissive enviro signed into law by Bill, the cigar man, and cemented by W. The slicksters, by and large, bailed just in time with their pots o' gold, leaving their employees to be laid off. This is a repeat of the gilded age.....with no Teddy R, in sight to save us.

Publius is right, a bi-partisan Congress told a sitting president (who was just re-elected in a lanslide), that he was to be impeached if he did not step down. That will never happen again, short of a French Type Revolution.

For a cool summary. Examine Arnaud DeBorchgrave's take on things. I have been following his reportage for a long time, and he does not bite his tongue. He was also a combat daddy reporter in Vietnam, whose stories were first hand.

Anyways, here goes....hope this cheers you up Karl Marx marked to market.

almost drafted said...

Just a couple of facts from the "follow the money" dep't:

In the halcyon days between 1951 and 1963, the highest marginal tax rate (for income over $400,000) was 91%. Today it is 35% (>$450K for married jointly, >$250K for individuals, and >$450K for head of household).

Social Security payroll taxes max out at income over $106K. That is, you pay no SS above that figure.

When I was a teenager in the 60s, I learned that corporate donations to the major political parties were split about 50/50. In 2004, the split was 75% to the Repubs and 25% to the Dems.

Hmmm, what do you make of that?

Cheers,

JP

wourm said...

Are we back to O'Henry's days of snake oil salesmen and peddlers selling cure alls and patent medicines? All the more reason to become more educated.

We walk a fine line between the government's protective policies (or lack thereof) and and looking out for our own butts. I've seen my share of folks who signed on to an ARM with wacky rules for the rate adjustments. I could only wonder why they couldn't see what this thing might do once the teaser rate went away. Are people too lazy, too confused, too complacent? It leave me scratching my head.

Tax evasion always bothers me. Once a person has amassed about $15-20 million, he can live VERY comfortably living off of 3-5% interest on that money. Even after taxes are subtracted. Why avoid paying his fair due? It's still a small fraction of what he's got.

As for transfer of wealth, it ebbs and flows. I look at the Dupont family here on the east coast. Where there once was a small clan of hugely wealthy family members, there is now a diluted, not nearly as wealthy, distantly related group.

I definitely think we need to review financial and investment as well as trust busting and monopoly legislation and modify it to apply more closely to modern banking and finance practices.

As far as our current situation goes, we had a period of excessively high priced homes, with values that were only backed up by the demand. With excessive lending in the 'high value' real estate, there was now too much money in the system. It caused the already high priced real estate to become inflated. It caused a false demand for more housing. Once that demand went away the housing prices deflated, the bubble burst. Now all that money was removed from the system. Fortunately, the deflation has been limited to the housing market. Personally, I haven't seen dropping prices anywhere else (oil is a different story). Unfortunately, there were a lot of people relying on that hot housing market to make a living. These are the people who started struggling last summer and whose lower consumption pace was passed on to the manufacturing sector where we've seen the effects leading up to now.

Yes, we'll see some years of adjustment with a slower housing market. I don't think the government should artificially stimulate housing, they've already tried it with disastrous effects. Krugman wants to get the economy back to where it was two years ago. I don't think that's possible without the hot housing market or something to replace it. I'll settle for something like what it was five or six years ago. And we'll build, at a reasonable pace, from there.