Our Invisible Safety Net -- Will it Hold Us Up?
America's safety net is fraying, and that's a problem, because it was an invisible net to begin with. The issue of safety nets isolates us in the world. We don't like to think that we are a cruel, careless, or reckless country. Yet consider how others see us. The United States isn't getting any love from Europe right now. Except for England, every country has resisted any move toward massive stimulus. When President Obama pleads for global unity, the typical European response is "You got us into this mess. Why should we follow your lead now?" But something deeper is at work.
Europeans aren't panicking over the meltdown. Why not? Because of a social safety net that has been woven for the past fifty years. The typical citizen of Sweden, France, or Germany can count on free medical care and schooling from kindergarten through college. Unions are strong and unemployment benefits more or less permanent. In the current bust people will suffer, but their lives won't fall off the cliff.
Falling off the cliff is the phrase Warren Buffett used to describe the U.S. economy last week, and unlike Europe, America provides a threadbare safety net. If your job goes away here, so can your health and your child's hopes for college. There is no guaranteed public housing beyond that provided for indigents. The rest of the world thinks we're crazy, but in this country we rely on an invisible safety net. The strands of this net are made of confidence, self-reliance, a strong streak of individuality, and, as always, orneriness. The more of those qualities you possess, the less you need the government to help you in any way -- or so we tell ourselves.
Now the invisible safety net is unraveling.
For decades we were rich enough to believe that anyone could survive by living in the cracks of the sidewalk -- through odds and ends of work, credit cards, loans, and ever-mounting house prices (if you happen to be a home owner). Society is fluid and mobile, allowing someone who can't find work in Michigan to pull up stakes and move. Few young families carry the burden of taking care of parents and grandparents, who in turn don't want to be dependent, either. And despite the crippling cost of health care, when push comes to shove, hospitals do care for everyone, even the poor and needy.
Is that a crazy way to live, as the rest of the world assumes?
It has worked for such a long time that Americans have gone into shock over the past six months. They are faced with a President who says that the future can't be the same as the past. Credit is gone. Mobility has fallen off as every part of the country feels the pinch. Immigrants take millions of low-paying casual jobs. Health care is so expensive that a middle-class family can be wiped out by one serious illness or accident.
We need a visible safety net along the lines that Europe has built. The trick is to retain the best part of our invisible safety net, which is its underlying psychology of self-reliance, confidence, and, yes, orneriness. That thought came to me watching a Sunday news program as one pundit after another pecked away at the Obama rescue plan. You would think that everything the administration is doing is either wrong, too late, or not enough. In fact, nobody knows. But one thing is certain. America without confidence isn't America anymore. Pundits, experts, and even Republicans need to keep that in mind. We had the opposite situation in 2002, when the pundit class formed a unified chorus backing the wars in Afghanistan and Iraq (with a small clutch of dissenters). American confidence was stretched too far, to the point of arrogance, isolation, and imperious military bullying.
Now the small clutch of dissenters is in power, having discovered that they had truth, history, and ultimately the American public on their side. To see the pundit class turn on them is sickening, because the experts have forgotten how much we owe to Obama simply for sticking it out and swimming against the tide at a time when America needed rescuing from moral contamination. Obama is trying to give us both a real safety net and our old confidence back. Everyone who pays lip service to FDR's greatness while pecking away at the current President should open their eyes. The only safety net we have is each other. The naysayers who blithely tear Obama down today would have torn down FDR, and the results could be just as dire.
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What is interesting about the US, is over the years they have promoted the idea of the American dream of being rich as a goal for immigrants and a bias in immigrants has tended to develop where wealth took precedence over life style. The one singular rule of being rich is everybody around has to have less, regardless of how much you have, if everyone else has the same by definition you are not rich. So to be rich you have to work at basically exploiting everyone around you, so that you have more and they have less, it is called profit and the higher the profit, the more exploitative you are, the more you a celebrated in American culture. A safety net more than other government institution precludes one specific possibility, the opportunity to exploit the desperate, when people are at their most vulnerable, when their families are suffering, they are ripe for fiscal and moral exploitation to not not only satisfy the greed of those with money but also the lusts of those with money. No true social welfare for Americans in your life time.
Well,,,
It is also a matter of savings,, and discipline. I know,, that horrible word.
Lets look at savings. Say,, you are 20 years old,, and find a savings account that yields at 5% compounded interest.
Knute’s Pocket Change savings plan.
Each night you take out all your change,, Ones and change only,, and put it into a jar. Say,,, $3,90 Per day.
At age 65 you’re worth,,,,,,,,,,, $238,082.
Knute’s No Morning Latte,,, No White Chocolate Mocha at Lunch plan. Take a Thermos instead and a morning cup or two at home. Bout $6.85 in savings per day.
At age 65 you’re worth,,,,,,,,,,,,, $419,186
Knute’s Skip Lunch Diet and savings plan.
Lunch, about $12 Per day. Take a grilled breast of chicken and salad in a brown back instead.
Age 65,, you’re worth,,,,,,,,,,,,,, $976,743
Knute’s Lawn Mower savings plan.
You set aside Saturday Mornings ONLY,, and mow a few lawns, say 4 laws at $35 each,, $140 a week.
At age 65,, You’re worth,,,,,,,,, $1,139,533.
Knute’s C0MBO, savings plan.
Save your daily change, $3.85 per day, Skip Lunch, $12, P.D,, the Latte, $3.50,, PD Mow the lawns. $140 a week and add $50 a week to the pot.
At age 65 you’re worth,,,,,,$1,587,207.
Just food for thought.
All the best
Knute
Well, I was masticating that nugget of wisdom and I bit into a stone, Knute....
All those people who don't get to serve those lattes, your morning brekkie on-the-fly nor lunch...
All those birds which don't need slaughtering and preparing cos you and yer army decide to eat healthy...
Who's gonna fund the training of all the chiropractors needed when yooz guys mess your backs up by mowing all those lawns...?
OK,,, lets see… The Mowing Thing,, Saturday Mornings are too much to give up to become a Millionaire?? Really?
The Lunch and Latte thing?? That is why Denny’s and Starbucks are Billionaires and we are broke.
Surly you think,,, Pocket Change,,, is not too hard?
The Chicken thing?? Raise your own,,, and just feed them kitchen scraps turned into WORMS in a small worm-bin under the sink.
Wait,, I know! I Know!
The Knute’s,,,,, I,,, Donna-No-Wana,,,, plan.
This Plan is easy!
Take all the money you plan to give away to Starbucks, McDonalds, Denny’s,, or the Bar after work,, and before you leave home,, place a equal amount into a jar. This plan also give you READY,,,, feed back,,,, as to you spend each day. THEN,, go to lunch,,, to the Bar and hang out with your other broke friends.
Say,,, $30 per day????
By age 65 you are worth,,,,,$1,822,904.
Oh,,, and on the Mower Deal,, Buy one that is power drive, and add the money you will no longer need to spend at a Gym,,, into the Pot. About another,,,, $101,282 at 65.
All the best
Knute
Well Knute, they say that hindsight is 20 20, and mostly I agree with your savings "plans", in fact, except for mowing lawns, I've done the same things you have: use a daily "change jar", make my own (better than starbucks!) coffee/tea, and always bring my lunch to work.
I've always believed that Debt is Slavery, so even though I have and use a credit card (Just ONE) I pay it completely off every month, which means I don't really buy anything on "credit". There are things worth saving for and some things we have to sometimes go into debt for admittedly, like housing, higher education (in our country it's not free like in Europe/Asia which is way they're winning the global economic race) and means of transportation. But I never bought a NEW car, and worked my way through school instead of taking out loans. Today, I am frugal, and DEBT FREE, and still worried about the economy, because it's not just about me, we're all in this together, sink or swim.
No,,, please,,, kindly,, I was only showing how small things,,, we take for granted,, can add up over time.
By 36,,, I was worth over $2,500,000,,, this is not difficult.
When I was 19,, I bought my father a 4 bedroom 3 bath home, horse property with 2 paddocks, paid for with money I earned rebuilding and restoring old Motorcycles. I could buy a motorcycle in disrepair for 50$ and in 2 weeks, sell it for $700. In the 60s.
In the 50s,, I painted house numbers on curbs,, and made TWICE what my father did per week,,, working for others. Bout $600 a month at age 8.
I am Blind today,, and pay for this computer and my Internet connection by collecting and selling aluminum cans from a wheelchair.
In the 70s I owned a Horse Ranch and Boarding Stable as a young man,,, and grew very tired of,,,, Hauling Manures,,, to the dump.. The Landfill,, When,,,, I remembered about Grandpa teaching me to use Worms to turn Manures into Fish Bait. AND Cash!
SOON,, I was making more money on selling Fish Bait and Worm Castings to Landscapers,,, than I was making from the whole Horse Ranch combined.
And guess what??? It was NOT WORK TO ME,,, It was fun!
I love working! To me,,, Business,,,, is a way of expressing a type of creativity.
All the best
Knute
Oh ONE other thing!
If you go to college,, Use this time to get an Education,, NOT as a way to get a good job.
If you are in school only to learn things that will make others rich,, YOU LOOSE!
Here is what I mean.
If at age 20,, you were to invest that same,,, Say,,, $300,000,, for a Masters,,, (Housing Food and Expenses).
By age 65 this investment will have grown to,,, $2,695,502,,,,, While you sleep!
As far as replacing your Education,,, get a really cool job,, like Bartender,,, Surfing Instructor,, Ski Bum,,, Handy Man,, and attend Night School at a local Junior Collage augmented by an Online Harvard,, Yale,, or Princeton Extension Course.
If you want to travel,, take out a small “Asset Secured” low interest loan and go have fun a couple months a year.
OH and read,,, Get a library card and READ. Read about EVERYTHING. Read a book or two a week.
Never,,, Never,, Never,,,, go to school to get a job!
Use school to gain an Education!!!!!
NOT A JOB!
All the best
Knute
AND we still need a visible safety net. In order to walk fearlessly into the future and compete in the world, we must take care of citizens' basic needs for health, education, care.
We certainly have a visible one.
Are any of the things you've mentioned any less important than national defense...?
Priceless....
"To see the pundit class turn on them is sickening, because the experts have forgotten how much we owe to Obama simply for sticking it out and swimming against the tide at a time when America needed rescuing from moral contamination. Obama is trying to give us both a real safety net and our old confidence back. Everyone who pays lip service to FDR's greatness while pecking away at the current President should open their eyes. The only safety net we have is each other. The naysayers who blithely tear Obama down today would have torn down FDR, and the results could be just as dire."
Excellent article! Thank you, Mr. Chopra.
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