Coffee heat rising

WTF? Doesn’t anyone hear that alarm going off???

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Hello? There’s an alarm shrieking. Is no one paying attention? The House has approved a NINETY PERCENT TAX for the sole purpose of punishing a corporation whose executives annoy us.

Folks. The federal income tax is not intended to be used as a bludgeon.It may be against the law to use it that way.

This is a disaster for America, far worse than any economic recession could be.

Make no mistake about it. The powers that put George W. Bush in office will be back. This precedent will give them a handy-dandy tool to use against people they don’t like. And who knows? One of those people could be you or me.

That’s the whole issue about the rule of law. It’s supposed to protect everyone, not just people we don’t like.

The Times reports that “Democrats and some Republicans said the tax on bonuses for traders, executives, and bankers earning more than $250,000 was the quickest way to show angry Americans that Congress intended to recoup the extra dollars.”

“Quickest way?” We call that expedience. Another term could be stone stupidity. It’s every bit as stupid and arrogant as the Bushite theory that if a president says something, that makes it legal.

I don’t like AIG’s actions any more than the rest of us do. But that doesn’t justify trashing the Constitution in a fit of pique. There’s gotta be a better way.

This one is going to come back to bite. In a big way.

Tough times

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Men in a soup line, ca. 1936

Men in a soup line, ca. 1936

Here’s a sign of the times: Greg the Handyman called yesterday to see if we were ready to line up him and his son to do some of the various chores at my house and M’hijito’s. In the course of chatting, he said the two of them were totally out of work. His son, a finish cabinetmaker, was laid off his job when the construction company he worked for folded. That’s not surprising. But what is scary is that Greg himself hasn’t had any business. He said his business phone had rung all of three times in the past week.

This is a guy who was so busy he couldn’t keep up with the work. You often couldn’t get him to come do repairs at all, because he didn’t have time. He refused to work outside the North Central area—for those who don’t know Phoenix, that is not a large district—and still had more work than he could handle. He used to drive around in a Mercedes convertible.

An ancient one, but still…a Mercedes.

It suggests that not only are people not buying and selling real estate, they’re not maintaining it, either. And if you’ve been inside a Home Depot or a Lowe’s lately, you might surmise that they’re not doing the handyman tasks themselves. What that means, I think, is a general deterioration in property here. The central-city houses are pretty old—mine was built in 1971, and it’s in a relatively “new” tract for this part of town. The outlying suburbs are so cheaply thrown together as to defy belief…I remember the day one of my friends learned that rain was leaking in because the contractor hadn’t bothered to install flashing around the roof vents in her new house. And the time another couple of friends had to remove and replace the “lifetime” tile roof on their four-year-old house, built by a contractor who was not required by the state or the county to provide any warranty on his work.

So you can be sure plenty of maintenance needs to be done on these shacks. It’s just not getting done.

Greg is trying to make up for it by overcharging. He wanted $1,500 to paint the trim on the little Investment House. Plus the cost of the paint. Gimme a break! Bila the Painter offered to do it for $800, and that included Dunn-Edwards paint.

At any rate, the cost of the smaller tasks is within reason, so he’ll soon be installing a new room air conditioner for me (hope that scheme works to save on the summer power bills!), replacing the busted smoke alarm and putting in one near the kitchen here, and installing the blinds and fixing a few things at the other house.

Photo: Franklin D. Roosevelt Library

‘Nother Moment

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The Carnival of the Vanities is up at Dodgeblogium. Thôt I’d missed the boat, having seen an earlier edition and not noticed my squib about Life in the Big City—turns out it appears in today’s issue. Two separate essays ruminate on the nature of partisan politics at The Primate Diaries, pretty interesting. At Living the Scientific Life, Grrl Scientist writes a book review that, unlike the eye-glazing recitations too common on blog sites, makes you sit right up and take notice…w00t! The Smarter Wallet has found a freelance job board, said to offer better pay than others that we know. Overall, an eclectic carnival, worth a look.

The Worst Financial Mistake You Didn’t Make

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Recently I was asked to describe the three worst financial mistakes I ever made. Well, that was easy… But later, it occurred to me that a more interesting question might have been “what was the worst financial mistake you didn’t make.”

Have you ever been tempted to do some damnfool thing and then later realized that you were smarter or luckier than you thought? What’s the worst mistake you could have made, almost made, but then didn’t make? And why didn’t you make it?

If you’re a blogger, please join the conversation with a post and link back to Funny. If you don’t have a site, please leave your story in the comments section.

To get the ball rolling, here’s this:

The worst financial mistake I didn’t make was to quit my job about a year ago. By the end of 2007, I was utterly fed up with the difficult personnel problem embodied inMy Bartleby. I had decided that if I could not get the Great Desert University to RIF her position by the time of the next performance evaluations (which occurred in spring 2008), I would take the earliest of all possible early retirements. It was her or me: either she left, or I did.

Luckily for me, after she went to visit her out-of-town son over Christmas break, she came back resolved to quit.

What serendipity!

The factotums in the Dean’s Office had already decided that we would RIF her job, and so at least I had the support of my betters in my little project. But really: she could have protested, she could have claimed I was unfair to her (I’d been hounding the poor woman for months, building a case to show not only that we no longer needed the services she’d been hired to perform, but that her editing skills were not up to snuff), she could have engaged all sorts of bureaucratic machinery to delay dismissal. We were required to give her several weeks of notice, and although our HR rep said in these cases the worker is normally told to go home and collect her money, Bartleby—you can be sure!—would have preferred not.

If she’d put up a fight and made my life even more miserable than it was, or if she’d managed to evade dismissal, I very certainly would have quit. I was determined to bring an end to the whole unhappy business.

{LOL!} Having a son of my own, I can hear the male voice, embued with common sense. He would have said one of two things:

MOM! If you’re that unhappy, why don’t you just retire?

or, knowing Bartleby’s nature as he must have,

MOM! Don’t give that bitch the satisfaction! Quit before she can fire you.

Whatever he said, it was the right thing. Bless him.

If I’d retired last spring, I would have been just getting by on the proceeds of my savings and a minuscule Social Security benefit. When the economy crashed and $200,000 of retirement savings disappeared, I would have been flat out of luck.

Don’t know how God felt about Bartleby, but She was on my side that time!

Moments of Fame

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Green Panda Treehouse hosts this week’s Carnival of Personal Finance, where Funny’s rumination on the “Slow Money” idea appears. I enjoyed Pimp Your Finances’s rant about the widespread allegation that responsible savers are trashing the economy. Living Almost Large questions the long-term effect on the economy of excessive and almost universal student loans. And there’s a good essay at the Personal Finance Playbook on price-to-rent ratios, something of interest to some of us who might not have planned on having to rent out a house.

Funny’s reminiscence about nearly buying a bed & breakfast appears in this week’s Carnival of Personal Development, hosted by Health Money Success. The round-up is getting quite large. I liked this: Jacob Duchaine gives us 10 steps for getting a girlfriend. Wonder if they’ll work to get a boyfriend, too? Beyond Bounds has a nice post on “living the jobless life.” I like it!

Feels Like Home hosts this week’s Make It from Scratch Carnival; my scheme to soften laundry with hair conditioner made the cut here. And whoa! Right at the top of this carnival is Praiseworthy Things’s guide to making almond milk. In my misspent youth, I used to make that. PT’s looks better: she uses better tools and she takes her time. As a bonus, she also tells how to use the leftover almond meal to make bird suet. Wifely Steps has an interesting and beautiful-looking recipe for sautéed bitter gourd, a Filipino dish. Uh oh…chocolate addicts had better avert their eyes: 5-Minute Chocolate Mug Cake from Lighter Side. You make it in a mug, cook it in the microwave, and from the photo, it looks highly edible. At Recession Depression Therapy, Neighbor Nancy offers some encouragement and the basics about canning. If you’re gardening a lot or you have fruit trees, canning is a great way to make the most of your excellent produce. I could cite every post in this carnival: it’s full of neat ideas and fun things to do. Be sure to visit!

Speaking of Make It from Scratch, Funny will host next week, so be sure to submit your best ideas at using this handy carnival form.

Frugality, savings, and the causes of doom

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Okay, I know that writing about the same thing other bloggers are posting is a form of mob journalism, much to be avoided. But what the heck… Pimp Your Finances is riding one of my favorite hobbyhorses, the argument that saving and frugality are harming the economy. We cheapskates are to be blamed for the fall of civilization as we know it.

No. ‘Fraid not.

As I was harmonizing with PYF’s rant, it occurred to me that there’s a subtle difference between saving and frugality.

Saving means setting some money aside for future use. Generally savings go into bank accounts or into other financial instruments with higher risk and higher potential return.

Frugality means living within your means: spending less (or at least no more) than you earn.

Most people who are frugal are in a position to save money; obviously, if you manage to spend less than you earn, you can take that unspent money and invest it somewhere. But some people who are profligate—who have run up revolving debt or have bought more house than anyone in their right mind could possibly claim to need—also are able to save money, if only through mandatory 401(k) or retirement fund contributions.

My Journey to Millions added a comment to PYF’s post noting that savings do not get locked in a vault somewhere. Banks loan out depositors’ savings (or so they’re supposed to do) to individuals and businesses, and that’s a large cog in the wheel that is our economy. When banks refuse to lend, as they’ve been doing in the present crunch, the economy grinds to a halt. Thus saving not only is not bad for the economy, it’s crucial to any nation’s economic health.

What short-sighted critics are saying is that frugality—which they equate with miserliness—is wrecking the economy. These are the ninnies who suggest that if we would just all hurry to the mall and max out our credit cards on junk we don’t need, everything would be just fine.

Here’s the hitch in this thinking:

When the bank owns your car, your house, your furniture, your clothes, and the dinner you sit down to at a restaurant, you’re renting your whole life and you have nothing. Although you may look affluent, the truth is you’re living in poverty. Living on the cuff creates the illusion of wealth, but it’s only an illusion.

It’s like living in the Land of Oz. Behind the lights and mirrors, our late, great “prosperity” was phony. With everyone spending until their income went mostly to service debt, no one had a REAL nickel or dime to rub together.

When everyone spends and saves responsibly, from the average person on Main Street to the A.I.G.’s of this world, then the economy will be healthy. The economy is healthy when most consumers, businesses, and lenders are financially healthy.

There’s no “paradox of frugality” here. None at all. Just a fake wizard in an Emerald City.