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Money matters

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I remember in Junior High school when I could buy a bag of potato chips for 25 cents. Then there was a jump in price, with a smaller bag being sold for 35 cents. That was a big jump and it took a while before paying more for less became the norm.

There are distinct times in my life when I recall these kinds of jumps. Like when it was crazy to see gas be over 50 cents a litre, then the price jumped above 70 cents and when it dipped back down it never went below 55 cents again. Give us gas at 71.9 cents a litre for 2 months and suddenly we are quite happy to see 55.9, like it’s a bargain price. Now I’m checking my tank to see how much gas I have when the price is under $1.65, because that’s too good of a price to pass up.

I get that prices need to go up, but what I don’t understand is how this is happening while simultaneously banks, oil companies, and grocery chains are recording record profits. It’s literally a case of gouging the consumer and blaming inflation.

Rants aside, I’m up at Whistler with my family, my mom is visiting and has never been up here. We are staying in a wonderful hotel, a surprise gift from a friend, and my kids can’t get over the way people spend their money. Here, room service for 2 would be a fancy meal for all 5 of us… and no we didn’t order any, we just looked at the menu.

A day of skiing for our family, with 2 parents and 2 adult kids would be $1,200, and if the kids were under 19, $1,100, and under 12 would be $900. Most families are here for 3-4 days of skiing. Many have flights to pay for, and hotels here are not cheap!

But for some people, spending $15,000 to $25,000 for a vacation is… normal. For others that’s a significant portion of their yearly salary and out of the question.

It’s funny, you always hear, ‘money can’t buy happiness,’ and while I agree with that, there is something affluence does buy, it buys a sense of freedom. Money matters because when you have a lot of it, you don’t have to think as much about your spending. You want something? Buy it. You need something done quickly? Pay someone to do it for you? However, when you don’t have the freedom to buy whatever you want, when the cost is prohibitive, money really matters.

Prices have jumped significantly since Covid. There are more people struggling to make ends meet. There are more people choosing not to go out for dinner because the cost is just too excessive for a family. There are people who used to ski at Whistler who have been priced out of that option. There are many more people who don’t make a purchase without thinking of the cost. They don’t have the freedom to spend without thinking of the consequences of a purchase.

That’s what affluence buys, it buys free buying power that doesn’t feel nearly as free for less affluent people. Monet matters less as you get more. I’m not sure what the sweet spot is, where the transition happens, and I’m not sure I ever will. I just know I’m at one of those price jump times where I’m going to need to adjust to the price jumps wherever I look… I’m just not sure I’ll be adjusting to these new price ‘lows’ any time soon. It’s a time where money matters for a lot of us.

Unsustainable and increasing inequality

Here is page 7 of an OXFAM report, Inequity Kills:

What’s not necessarily well known is that the Forbes and Bloomberg ‘Top 10 Richest’ lists never includes some of the richest and wealthiest families which have accumulated wealth above and beyond anyone on these lists… there is a lot more extreme wealth than these lists suggest.

Add to this the first two sentences in the report’s summary:

“A new billionaire has been created every 26 hours since the pandemic began. 6 The world’s 10 richest men have doubled their fortunes, while over 160 million people are projected to have been pushed into poverty.”

This kind of lopsided wealth distribution simply can’t be sustained. And yet in the hardest times of the pandemic, when many low wage people couldn’t work, prices and inflation skyrocketed while corporations that produce oil, and sell groceries, reported their greatest profits in years. They also returned their largest dividends to stock holders… most of whom are already very rich and can afford to hold a significant amount of stocks. We’ve all heard the saying, ‘The rich get richer while the poor get poorer,’ and it seems that this is more true now than it ever has.

I stumbled onto this report after reading this article on NPR, “Move over, Jeff Bezos. India’s richest man is now wealthier than the Amazon founder“. The Billionaire club used to be almost exclusively a Saudi and USA thing, other than old family wealth, but now it’s a global phenomenon. Everywhere in the world there are small groups of people accumulating wealth in significant size, while there are populations in significant size that are dropping below the poverty line. This simply isn’t sustainable. That said, I don’t see anything upsetting this trend in the near future. Further, I’m at a loss to think of how this will change in the coming years?

At what point does a society with a few people owning more than half of the global wealth become unproductive for the wealthy? The abject poor can’t by the products the rich manufacture. The suffering middle class with less-than-ever disposable income, and more-than-ever accumulated debt soon won’t be able to help either. So what breaks? How does this self-correct?

I certainly don’t have any answers.

The geography lottery

You don’t pick your parents. You don’t pick your country of birth. My grandfather was born in the Ukraine. I could have been too. My other grandfather escaped Poland before the second invasion in WWII. Much of his family that didn’t escape perished. I could have never come into existence.

There are children being born today that will have little or no chance of ever going to school beyond high school. Others who will start work before their 10th birthday. Still others that will know hunger in ways we never will.

We take for granted the opportunities we are given. We complain about things that others would consider a luxury… I wish my car had heated seats. I wish I had the latest phone. I asked for onion rings but they gave me fries.

Sometimes it’s worth pausing for a moment to appreciate that through sheer luck of birth, we have been given opportunities others will never get. We won a lottery that others dream of winning. Be grateful. Be thankful. Be generous. Be kind in thoughts, words, and deeds… Especially to those that have not been as lucky.

Two great divides

The gap between the rich and poor is getting bigger. The middle class seem to be lower down in the separation of this gap. One simple thing keeps the divide growing, and that is debt.

When a typical person buys a house, and starts paying a mortgage, then their future income is tied to their debt.

When a rich person buys a house, they are making an investment with their earnings, and their house becomes a future source of income.

One pays interest, the other reduces capital gains. One pays monthly, the other moves their money around. When one does renovations to add value to their home, they increase their debt, the other adds to their write-offs, and reduces taxes on gains.

But the part of this that really makes a difference is that with interest rates so low, the rich don’t use their own money, they too borrow money for expenses. But while poorer people use a large part of their income to pay off the low interest debts, the rich use their ‘extra’ money to make more money than the cost of the low interest debt. By borrowing, they increase the wealth gap. This great divide gets bigger.

This is a bit of an oversimplification, but it speaks to the fact that people live in different worlds. The same way I’ve described this gap, I can describe another gap between the ‘poor’ middle class and the truly poor. For the truly poor, they can’t buy a home, and so their rent does not go towards any equity. Their wages only go to survival. An unexpected debt of just a couple thousand dollars can be enough disrupt the balance and cause homelessness, or force the need to take out a high interest loan… because the poor are a risk to default and so they pay a premium on debt. Then payments for that debt become the focus of wages, but there is no house, no equity made on that debt, it’s purely an expense.

For the truly poor, the wealth gap is a an inescapable chasm. This is the gap that matters most in our world, the one that keeps people at or near poverty levels. This is the great divide that really matters, and it’s one that should be addressed by the leaders of our world in the same way that they are approaching climate change. It matters not just to the poor, it should matter to everyone. Because in this amazing world we live in, there is no need for the poverty we see to exist.

A reset is coming

I’m not a futurist. But I see the writing on the wall:

  • Bernie Sanders and Andrew Yang put the idea of a Universal Basic Income (UBI) out in a way that has made it a serious consideration.
  • Bitcoin has gone past 50k and Tesla is leading the way in using Bitcoin the same way investors hold gold.
  • It’s clear that taxes are broken and corporations and billionaires are not taxed fairly, but there are too many loopholes to fix this any time soon.

In a short period of time we aren’t going to look at money the same way. We won’t look at the work week the same way. I don’t know what this will look like, but it will be very different… and this will happen sooner than you think.

What happens when we find a vaccine?

At some point scientists are going to find a vaccine for COVID-19, and two things become immediately evident. One: there won’t be enough vaccine to give to everybody as fast as they want them. Two: there will need to be a thoughtful plan to distribute the vaccine in a way that maximizes it’s effectiveness.

The three easiest places to start:

  1. Health care workers
  2. Senior homes
  3. High risk due to age or health conditions like immune sufficiencies.

But what’s the order after that? The reality is that money and power will play a big role, and so athletes and famous people will get an undeserved advantage with respect to how fast they get their vaccine. This unfair advantage will occur. But if you were in charge, who would be next after the list I mentioned above?

Where do grocery and restaurant workers fit in the schedule? Or workers at food production farms and plants? What about teachers and professors? Dentists, physio, and massage therapists?

What restrictions might fall upon those not vaccinated?Will their travel to other countries be limited? Will their ability to work in certain sectors be limited? Will there be consequences for those that decide they don’t want to be vaccinated? (Besides natural consequences.)

I’m sure countries have already made decisions like this. I’m also pretty sure how counties do this will look different around the world. How it plays out will be interesting to see. If production of a vaccine is extremely fast, this won’t be a huge concern, but the slower the production, the greater the distribution order of the vaccine will matter.

Wealth, privilege, and charity

The challenges ahead are easy to understate and misunderstand. Things are still likely to get worse before they get better with respect to covid-19. Even when things open up, the virus will still likely plague us until there is a vaccine. Many jobs will not return, and the prospects for many will include requiring financial assistance, and/or abandoning mortgages that can no longer be afforded.

So when people like Jack Dorsey donate:

“$1 billion, or almost 30% of his net worth, to first fight the coronavirus and then help the causes of girls’ health and education, as well as experiment with universal basic income.” (Source)

This is amazing to see! And he isn’t the only one. Bill Gates is leading the charge to find a vaccine. Athletes are donating to food banks. Oprah, Rihanna, and Bono, three people so well known that they only need one name, have all stepped up to make significant donations to help during this crisis. Beyond that, countless middle class people are supporting their communities in their own way. A local archery club is donating lessons in exchange for food bank donations. People are making masks and hospital caps to donate. Some people are even doing things like paying their hair salon stylist after cutting their own hair. People everywhere are finding ways to be charitable. This is wonderful to see, and rewarding for those that are being charitable as well as those receiving charity.

But I wonder about the ultra wealthy and their total contributions. How many people with more than $100 million in the bank are really doing their part? It’s easy to be blind to your privilege, to not recognize that what you take for granted is what others cannot. I think that many of these wealthy people only see the billionaires ‘ahead’ of them, and not those with less doing more. And as for the billionaires, well they have no excuse.

It saddens me that people who are the most privileged do not have the charitable hearts that so many less privileged people do. The wealth inequity in our world is grotesquely skewed and now more than ever is the time for the privileged wealthy to do their part. Will they?

The Bell Curve of Free Will by David Truss

The Bell Curve of Free Will

Assuming Free Will: There are some interesting and compelling arguments that we do not have free will, and according to Sam Harris, that it is only an illusion. I will address this at another time, because my thoughts on this are not fully formed. I need to read and understand more, but my general thesis on this topic is that the black box of our unconscious mind is only ever opened through bizarre dreams, deep meditation, and psychedelic drug use… all of which suggests metaphorical images and thoughts that seems to transcend logic and linear processing. If that is the case, I highly doubt that our will is somehow ordained by our past experiences in some sequential domino effect. And while our conscious minds might not grasp the true decision-making processes of our unconscious mind, that does not remove the fact that our unconscious mind acts, to some extent, freely… even if our history, our circumstances, and our virtue (among other things) might influence and restrict how much freedom of choice we have.

For now, I want to assume that we all have free will. Given this, I’d like to look at The Bell Curve of Free Will that I constructed to describe my thoughts on this topic.

My Premise:

If we have free will then I believe that how much choice we have will be influenced considerably by our circumstance and by how virtuous we are.

Background on the Graph: I should have created 2 different graphs, one for circumstance and one for virtue, but the dotted line showing how one influences the other is important. Further, I could have created charts about how our choices are increased or limited based on many different factors, like our health, our culture or religion, or our parents. I chose circumstance and virtue because they are easy to connect in my example, and highly influential to our free will, or our lack of ability to make choices.

Here is the image I created:

Circumstance and Free Will: If you are destitute or impoverished, if you are in a situation where you are unsafe or starving, your choices are very limited. You are more likely to go to extreme measures to improve your safety or well-being, at any cost including illegal, unreasonable, or unconscionable means, even if you wouldn’t want to do these things if your circumstances are different. You will act to protect or feed yourself and your family and those reasons overrule reasons you would otherwise have to not do something desperate. However, your circumstances limit you from doing things many other people could easily choose to do.

On the other hand, if you are affluent and have a lot of influence, the choices you get to make are significantly greater than if you are destitute. From living arrangements, to choice of foods, to freedom to travel, to caring for your loved ones, an affluent person can make so many choices and have so much freedom to make those choices compared to those that are only thinking of survival or their next meal. This isn’t a bell curve, this is a direct relationship where affluence and power, or lack of these, directly influence the amount of choice a person has.

Virtue and Free Will: The vast majority of people have a lot of choice and free will, while people on the extremes of the virtue scale do not. If you are a genuinely evil person who gets pleasure out of being hurtful and evil, you are probably limited in your choice and ability to do good deeds and make kind choices. When you are angry, your choices become more limited, your reactions to circumstance are less likely to provide you with more options that if you were more level-headed.

On the other extreme, if you are extremely virtuous and benevolent, you simply could not make choices that are hurtful to others. You have more limited choice because your virtue would compel you to do ‘the right thing’ and not choose other options that are less kind, even if for example, they benefit you. Your choices become limited because you would not have the options that others would in your place. Mother Theresa probably could not choose to walk away from her charity, her virtue would not allow it.

High Virtue and High Affluence: This is shown by the dotted green line on the graph.

Affluence and influence do not necessarily result in endless choice. More virtuous people, who are also affluent, are compelled to be in the service of others and to use their means for good. Their affluence might provide more choice and means for them to do this, but if they are truly virtuous then they would be compelled towards using their affluence and influence in ways that demonstrate their virtuousness, thus reducing their will do to other things.

As a side note: I have seen many instances where people with very little means have gone out of their way to be generous and kind. And, our world is filled with many affluent and influential people who could be more virtuous and choose not to be so… even when it would mean far less sacrifice for them. Bill Gates explained this succinctly:

“My charitable giving is not impressive. What’s impressive is people who give to charities who have to sacrifice something to give it to him. In my family, we don’t even hesitate to buy yet another airplane. But there are people who have to choose, do I go out to dinner? Or do I give this $20 to my church? That’s a very different decision than I make. Those are the people that impress me.” ~ Bill Gates

An inherent flaw in putting these two graphs together is that an unintended extrapolation could be that the impoverished can not be virtuous, With this insight, here is one aspect of the two-in-one graph that is not shown, but should be noted:

High Virtue and Low Affluence: On both ends of these two scales the choice is limited, and so free will would be further diminished. As an example: A devout and benevolent monk or priest who is in the same destitute situation as someone equally as impoverished (but less virtuous) could not choose to harm or steal from someone even if it was to feed his/her own family.

Final Thoughts: I wonder if conscientious people who think about philosophy, and/or are compelled towards the sciences to do ‘good’, and make a difference in the world, are more likely to believe that there is no such thing as free will… since by nature of their virtues, they have less free will than someone that is not as concerned about the well-being of humanity? In a way, I could have titled this graph ‘The Curse of Free Will’ because either you are cursed to be evil, or you are cursed to be kind, since in both cases you are allotted less choice in life, less free will. Is it somehow more blissful and less restrictive to live a somewhat selfish life? Is our propensity towards this unenlightened life the reason religions are born? If free will does not lead us to be more virtuous, what does?

 

Having choice

There are billions of people in our world that are constrained by not having enough choice.

How many people in the world don’t have a choice of what their next meal will be? How much they will get? How nourishing it is?

How many children must work, and do not have the opportunity to go to school?

How many children do not have a choice of more than one thing to wear? Or are forced to wear something for religious reasons?

How many people pray to an unjust and cruel God, for fear of the wrath of their own family or community, (and not God), to ask questions?

How many people are not given the chance to speak out against their ruling government for fear of imprisonment or death?

Basic human and civil liberties are something that have improved over the past 50 years, and simple metrics like reductions in poverty and in deaths by malnutrition tell us this. But in an ever shrinking world brought together by the internet, inequalities are far more visible. And the sensitive nature of some of these topics are such that people speaking out can face ridicule, harassment, and might even fear for their lives.

Some people are given less choice about how they get to live their lives: The language they speak, their geography, their ethnicity, their gender, their sexual orientation, their parents, their social and economic status, all these can in some way limit or privilege the choices a person has. But for many, they are not limited in their ability to see what others have, and even show off, that they do not have. Affluence and privilege is flaunted openly and excessively. This creates an even bigger divide, because the rich and the famous so obviously have choices that others do not. Agency feels relative when comparing those who have much of it from those that do not.

How important is the right to basic survival (food and shelter)?

How important is the right to a good education?

How important are civil rights and freedoms?

These are all vitally important when they are not available, and easy to undervalue when they are readily available. When we are given the freedom and choices others are not, what is our obligation to speak up and to help the less fortunate?

What obligation should the wealthiest people of the world, those with the most choice, have towards those with less choice?

If you earned $1,300.00 a day for 2,000 years, you still wouldn’t be a billionaire. If you spent $36,000.00 a day for 75 years, you still would not have spent a billion dollars. How is it that the number of billionaires in the world are growing? What does this small group of people need this much money for?

Inequalities are so blatantly obvious in our world today. Some of these are being addressed in amazing ways, but globally inequalities are being exaggerated. Geography, wealth, culture, and history matter significantly and these all factor into the choices people have and, in many cases, the choices people don’t have. I think the most powerful choice we can make is to choose what we value, and devote time, effort, and compassion to those with less choice than us… and not valuing fortune, fame, and financial affluence. This is a choice we can all make.

500 Billion Dollars

Imagine if the richest 100 people in the world each put aside 1 billion dollars to change the world. Think that’s too much? I just looked up the top 20 billionaires and they could each give away 15+ billion. Realistically, there could be 500 billion or 1/2 of a trillion dollars given away from the top 100 billionaires without changing their lives significantly.

What could that money be spent on?

Clean water, clean(er) energy, and food for the poorest 1/4 of the world. This would be a good start. Health & family planning would also be essential.

How different could our world be?

When I read articles like this: ‘Eye-Popping’: Analysis Shows Top 1% Gained $21 Trillion in Wealth Since 1989 While Bottom Half Lost $900 Billion

I wonder how these billionaires can imagine that their continued gains can benefit anyone, including themselves? At what point do gains like this have diminishing returns? At what point does compassion replace greed? At what point does social conscience take precedence over financial profit?

I don’t pretend to have the answers as to how to do this in a way that is equitable and helps people thrive, but with that much money, people smarter than me could be hired. There needs to be a redistribution or redirection of wealth to make our world more equitable, and more livable for those that need it most.

11 years ago, George W. Bush bailed out banks for 700 billion dollars. Since then, those banks have made the rich richer. What if the richest people in the world were to bail out the poorest? How many lives would be meaningfully changed for the better? What impact would that have on the overall well-being of humanity? The world needs another bailout. The richest people in the world have the means to provide it.

Image the possibilities!