Man it was a rough weekend, the kind where we are reminded that in the end, we are left to our own devices. I lost power around 1PM on Saturday, the same day we planned a birthday party for my sister-in-law. The party went on, but only after we watched a power line transmitter catch fire and blow right in front of the house as scores of large branches and trees fell as if shot down by a laser from a passing spaceship. It was an amazing scene, but one that had been predicted by smart meteorologist like Joe Bastardi a week ago. I still can't understand why my power company was once again flat-footed and unresponsive.
As I dragged giant branches from in front of my house Sunday morning, I wondered how in this (not so) brave new world where my paycheck is supposed to be spread out beyond the more than 50%+ of the money I earn now are my taxes supposed to work. You see not a single person that's been on welfare for life came by the house to offer help. The government didn't swing by my house with a truckload of people to help me, my son and my nephew shovel snow. I don't think President Obama or Elizabeth Warren were on the horn telling people to go help their neighbors.
What is this so-called social contract and what does it really mean?
After spending a couple of hours lifting, dragging and shoveling, we loaded up the cars and spent an hour looking for a place to eat. (I'm not big on those reviews online with the stars as I find its typically dissatisfied people motivated to comment, but the diner we ate at wasn't worth the two stars on Google, but it had power.) We spent the night in the city because there was no way we could have endured that freezing house. I'm going to ask my power company to reimburse me, although that will be an uphill challenge. In the meantime, beyond the fact this so-called social contract seems decidedly one-sided, the message of victimization means nobody even tries.
If I didn't have a job, I would have gone door to door shoveling snow for money and made a lot of it. It's amazing that not only is there no accountability on one end of this contract there must be clauses in it as well to remind a ward of the state. I continue to say the new mantra for this nation goes something like this:
The harder I work the more I owe American
The less I work the more America owes me
At least I got my workout in although I missed my cardio since I couldn't hit the treadmill. The message learned is that you better be ready to take care of yourself and protect your family any way you can. This applies to finances, too.
If you plan to live only on social security then you are going to be in a world of trouble. We are watching that fund burn the way that transformer did in front of my house on Saturday. It's only a matter of time before it blows.
The Real Measure of America
Of course Bill Maher took that CBO report to make that bogus illustration and narrative that somehow a handful of rich people have hoarded the money since 1979. On Friday, I explained how the report should be read and celebrated and asked you to share your American success story. The response was overwhelming, so here's what I wrote on Friday and once again I ask for your story because that report doesn't condemn America, it validates America.
Flipping television channels this week, the story of income inequality was a common theme but taken and twisted in such a devious way as to incite anger rather than enthusiasm. I find it interesting in the land of opportunity where we all like to talk about the sky being the limit there is so much anger at the top 1% percentile for reaching after tax household income that's risen 275% higher from 1979 to 2007. The report from the Congressional Budget Office was said to justify the anger at Occupy Wall Street and proves we should punish the rich.
The story was told as if the same people in the top 1% income category in 1979 were its sole members in 2007. But that's not the way America works. In 1979 I was in the lowest quintile, and now I'm in the top 1 percent. When measuring my income, and judging America, the change in my income should be calculated in the lowest quintile to reflect where I started and my upward mobility. This is the disingenuous part of how this report was communicated. In this case, the trouble is the idea that a small group of people in 1979 established a way to increase their income at the expense of the rest of the nation.
We obviously know who the troublemakers are, but they are more than opponents of capitalism, they are destroyers of dreams. If we tell the story of this CBO report the right way, it's a story of increased fortune for anyone to go and grab. In 1979 Nolan Ryan signed a $1.17 million a year deal with the Houston Astros - it was a record breaking deal and first above one million annually. In 2007, Jason Giambi raked in $23.4 million as the highest paid player in baseball, an increase of 1900% from 1979.
I guarantee you that Alex Rodriquez, currently the highest paid guy in baseball, wasn't born in the top 1%. So, let's assume for argument sake he was born in the second quintile. At age 18, he would have been placed at $23,939 a year and this year at $32.0 million. His change in income would be 139,100% and that number should be added to the second quintile so we can get a true picture of what opportunity is in America. Do me a favor and figure out the percentage change using your current income against your quintile bracket back in 1979. I want a sense of what America is really about and not the scare tactics that the rich are hoarding. Email me at Charles.email@example.com.
By the way, much is being made this morning over the new contract for the CEO of Nabors Energy who will receive $100.0 million. The voices that complain about this didn't make a peep last week when the list of highest earning celebrities was released. Michael Jackson made $170.0 million, and I guarantee that his estate didn't create as many jobs as Nabors does now or has had a greater impact on society than Nabors products do. Take my word, after not having heat on the coldest day of the year and needing gasoline to flee to the city, I'm not mad at Nabors. I'm not mad at Jackson's estate, either.
It looks like we will open weak, which stands to reason after five miraculous weeks. The dollar is stronger as Japan tries to push their currency lower. I'm not sure if we will file a complaint with the WTO or threaten legislation, although I doubt it. This is the perfect time to keep your powder dry and let fresh opportunities develop.