Pareto Efficiency, Pareto Improvements and Meekonomics


It’s been a while since I’ve written specifically about economics.  Odd, considering that’s what this blog is supposed to be about but as with anything that has wide ranging implications on how we live our lives,  a discussion of economics must often run off on a tangent or two now and then. 

For those of you who’ve been tracking with me from the beginning you may recall my very first post in which I likened this study to falling down a rabbit hole. [Down The Rabbit Hole] You never know for sure where a particular tangent is going to take you and it might be quite some time before you find your way back to the original point.  As I’ve learned, a study of economics, politics, religion and life in general has a tendency to become just one rabbit hole after another. 

It’s with that in mind that I return to a classical economic theory and how it relates to the theory of Meekonomics.

Pareto Efficiency, named for Italian economist Vilfredo Pareto, essentially says that since goods and services are finite, for one person to become better off someone, somewhere must therefore become worse off.  According to this widely held economic theory a true Win-Win within any given economic system simply doesn’t exist.   A Pareto Improvement on the other hand is a situation in which by allowing a less well of individual to gain the overall benefit to society as a whole makes everyone better off.  A rising tide floats all boats; so to speak.  This theory works fine in a closed economic system but one thing Globalization has shown us is that there is no such thing as a closed economy anymore we are all playing in the same ocean and subject to the same tides.

As a society stabilizes, the opportunities for Pareto Improvements become fewer and at the point at which it is no longer possible to initiate a Pareto Improvement a society is said to be Pareto Efficient.  No further improvements can be made without lowering the standard of living of one person in favor of another. 

The terminology used makes it seem like Pareto Efficiency is the most desired outcome of a mature society.  However; I believe that much of what we are seeing today is the result of a society that has come very close to achieving maximum Pareto Efficiency and as the members of the occupy movement and others will readily tell you, that is far from a good thing.

In a Pareto Efficient society, those at the top of the ladder have absolutely no motivation to help those below them, the risk to their own position is too great.  We have been taught all our lives that we are in a Pareto Improving society and that in order to do our part to help raise the tides for everyone we must strive for a better life for our selves, get a better job, buy a bigger house and send our kids to college so that they can get even better jobs and spend even more money.  We are told that the money we spend flows down to the people who made those goods and services there by helping them to raise their standard of living, but that’s not the way it works at all. 

In the last few decades; as we have approached Pareto Efficiency the reality has changed.  Now in order to just hang on to our position we have to work even harder and live on credit or risk slipping backwards and those above us are just as worried about slipping down as we are.   The ugly side of Pareto Efficiency is this; in order for us to maintain our position we have to convince everyone below us that Pareto Improvement is still possible so they keep spending and supporting us.  It’s the opposite of trickle down economics, it’s a pyramid scheme!   

To Pareto Efficiency and Pareto Improvements, Meekonmists say ENOUGH!

Enough is enough.  Stop trying to move up the ladder and stop trying to stay on a position that you know you cannot maintain.  Take a good hard look at the numbers.  A recent study showed that Canadians, who are by nature much more conservative with their spending than our American neighbors, are carrying a debit to income ratio of 153%.  That means that for every dollar we make, we spend $1.53 to maintain our lifestyle, most of it servicing debt.  How do we do that?  By taking on even more debt! 

It doesn’t take a masters degree in economics to know that is just not sustainable.

We are now living in a Pareto Efficient society, the problem is that in order to maintain their position those at the top of the ladder are still trying to convince the rest of us that it’s a Pareto Improving society, while using their power and influence to sabotage our ability to move up the ladder. 

That is one of the main drivers of our politics and has help to fracture our society into left and right, haves and have-nots.  Pareto Efficiency is what has stalled our economy and the continued desire for Pareto Improvement has driven us into an unprecedented crisis of debt.  Until we recognize what is happening and make a conscious decision to allow or society to become Pareto Inefficient (i.e. allow ourselves to have a lower standard of living) there will be no relief. 

We must act now, before it’s too late.  Sooner or later a Pareto Efficient society that continues to behave as though it is a Pareto Improving society will collapse on itself.  That collapse will primarily be economic in nature but it could also lead to violence.  We are already seeing the rumblings of the coming collapse through the civil disobedience of the occupy movement, Tea Party politics and the so called Arab Spring.   How long before these mostly peaceful protests turn violent?   

Enough is enough.

Extra Long Quote of the Day


There’s a full post in here somewhere, maybe someday I’ll write it.  For now we’ll just have to let Ian Morris and his book, Why the West Rules – For Now, speak for itself….

The paradox of social development – the tendency for development to generate the very forces that undermine it – means that bigger cores create bigger problems for themselves.  It is all too familiar in our own age.  The rise of international finance in the nineteenth century tied together capitalist nations in Europe and America and helped push social development upward faster than ever before, but this also made it possible for an American stock market bubble in 1929 to drag all these countries down; and the staggering increase in financial sophistication that helped push social development up in the last fifty years also made it possible for a new American bubble in 2008 to shake virtually the whole world to its foundations. – Ian Morris; Why The West Rules – For Now

 

This Hurried and Harried Life


As the Christmas Holiday Season draws to a close and the New Year is upon us, I am drawn to reflect on a statement my wife made recently about how stressful life seems to have become in the past several years.  I can’t recall exactly what she said but it was made as we drove home from a very relaxing and rejuvenating time visiting family and friends over.  She wasn’t referring to anything specific either; it was just a general comment on the state of most of those close to us. 

I will turn 40 in 2012 and most of our friends and close relatives are between the ages of 35 and 45.  These are the years of peak activity for many.  It’s when we start families, purchase our first home and jockey for position on the ladder of success.  Apart from the death of a loved one; the birth of a child, moving and changing jobs are considered by psychologists the most stressful events one can endure.   Add to that economic concern and the ever present specter of saving for retirement or the education of the aforementioned children and it’s no wonder that stress related illnesses like heart disease and general anxieties have reached epidemic proportions. 

I blame the advertisers. 

We are bombarded with messages everyday that are designed to make us feel bad about ourselves and then show the wonderful new product that will fix our lives and make us feel better.  The fact is that in order to achieve that miracle thing we must spend more money.  But in order to spend it, we have to make it and in order to make it we have to work harder and spend less time doing the things that truly bring rest and rejuvenation. 

Of course we can always buy things on credit but that brings with it a whole host of other problems that I don’t have time to go into right now…

The point is that we are running around chasing after things that don’t last and digging ourselves into a hole financially, physically and emotionally that we may never be able to recover from.  Our culture tells us to do more and go faster.  But this cultural tendency is literally killing us.  According to Statistics Canada, the most common time for a heart attack is Monday morning and the fastest growing demographic for heart disease are women under 50. 

How counter cultural then is it to remember the words of Jesus on stress and our human tendency to chase after more? 

Look at the birds of the air; they do not sow or reap or store away in barns, and yet your heavenly Father feeds them. Are you not much more valuable than they? Can any one of you by worrying add a single hour to your life? [Matthew 6:26-27]

I leave you on this New Years Eve with that thought and this prayer; 

May 2012 bring you a stress free peace that comes from the wisdom and strength of saying NO when our culture pressures you to over commit your time, energy and financial resources to things that will pass away before or shortly after the dawn of 2013.

Estate vs. Stewardship Planning


I am a big believer in giving it all away and have always said that the best financial planning ends with bouncing the check to the undertaker. – Michael Bloomberg

Estate planning is a fancy term we financial advisors use to talk about how your hard earned money get’s carved up and distributed after you die.  But let’s call a spade a spade here shall we?  It’s really about trying to exert some control over your how your survivors behave from beyond the grave.  It’s the last chance most people get to tell their family what to do.

 
The fact of the matter is though that, once you’re already dead no will or estate plan in the world is going to guarantee that people honor your wishes.  And if people don’t honor your wishes there’s nothing you can do about it – you’re dead!  Sure you can name certain people or charities in your will but short of dumping all of your money into an insurance policy with a named beneficiary there is no guarantee that your final wishes will be honored.  And that’s if you even have a will in the first place, nearly 70% Canadians don’t even have that much of an estate plan.

But I digress…

 
What I really want to talk about is Stewardship planning.  That’s what a Meekonomist does instead of estate planning.  If estate planning is all about how to distribute your wealth after you die, stewardship planning is about giving your money away while you’re still here to direct its usage and see the benefit it can provide for others. 

 
Michael Bloomberg is not a Meekonomist but he wasn’t far off when he stated that the best financial planning involves bouncing the check to the undertaker.  What I think he was getting at is that since you can’t take it with you, you may as well spend it.  I’d rather see you give it away than spend it on yourself or your family.  I can hear some of you already, “That’s all fine and good for a rich man like Mr. Bloomberg but he’s a billionaire and I’m just getting by.” 

 
Are you?  Nearly every one of us in North America is among the top 5% of the world’s wealthiest people.  We spend more in coffee shops than nearly a third of the world’s population make in a year.  You may be just getting by but I promise you are also frivolously spending, or simply wasting enough money to make a significant impact on the lives of countless millions of people all over the world. 

 
But I digress…  Again…

 
The point here isn’t that we waste a lot of money, or that certain people have larger estates and therefore more options than others.   The point is that wealth accumulation is only good if it one day turns into wealth distribution.  You can either wait until you’re dead and hope that your survivors honor your wishes, or you can start to distribute your wealth now while you have the ability to control where it ends up. 

When Jesus said that “whatever you do for the least of these, you do for me,” [Matthew 25:31-46] he meant for you to do it in your lifetime, not to sit on your money until you die and leave it up to the next generation.   By then it’s too late.  Giving is meant to be an active choice that has a price.  Sitting on your money and leaving the distribution, even with the greatest of philanthropic intentions, until after you’re gone ensures that you never have to pay that price yourself.

That’s not stewardship.

 
It’s actually the ultimate in selfishness.  It’s the financial equivalent of giving torn clothing to the thrift store or moldy bread to the food bank.  In reality you just gave away your leftovers and your garbage and it had absolutely no effect on you or your lifestyle at all.

Not everyone who says to me, ‘Lord, Lord,’ will enter the kingdom of heaven, but only the one who does the will of my Father who is in heaven. Many will say to me on that day, ‘Lord, Lord, did we not prophesy in your name and in your name drive out demons and in your name perform many miracles?’ Then I will tell them plainly, ‘I never knew you. Away from me, you evildoers!’ [Matthew 7:21-23]

Traditional estate planning has its place, especially since we have no idea of when we are going to die but for a Meekonomist it needs to compliment, not take the place of, stewardship planning.

International Development, Chinese Style


There’s been a lot of talk in recent years about the growing influence of China on the international stage. As the world’s most populous country, (by some estimates over ten percent of the population of the entire planet is Chinese), embarks on a rapid industrialization their need for raw materials, natural resources and electrical power is unprecedented. Understandably much of the rest of the world is quite nervous about what an increasingly assertive China might mean for the rest of us.

China has always been an isolated country. They intentionally separated themselves from the rest of us centuries ago and hid behind a literal and metaphorical wall. It wasn’t until recently (in the past 50 years or so) that they began to immerge from behind that wall. Tentatively at first but ultimately out of necessity, once the process was started it was impossible to reverse.

The size of China makes a lot of people nervous. What happens when the world’s largest population makes rapid industrialization a priority and becomes the world’s largest economy almost overnight? To hear some economists and politicians speak, it’s as if a growing Chinese economy is a harbinger of the apocalypse.

However, from the very beginning China has had an over-riding policy on the way they engage in international trade, especially when dealing with less developed, resource rich countries. This policy was originally published in 1964 and is still referred to regularly by Chinese politicians and industry today when making their international deals. The so called “Eight Principles of China’s Aid to Foreign Countries” is not at all what you might expect from a communist country, especially one that is seeking to export not only its products but also its ideology. On the contrary China’s approach to international development is far more egalitarian and less confrontational than the United States and the major western donor organizations.

What follows is a complete listing of the eight principles as published in 1964, we in the west could learn a thing or two about mutually beneficial, no strings attached aid and market economics from the Chinese.

1. The Chinese Government always bases itself on the principle of equality and mutual benefit in providing aid to other countries. It never regards such aid as a kind of unilateral alms but as something mutual.

2. In providing aid to other countries, the Chinese Government strictly respects the sovereignty of the recipient countries, and never attaches any conditions or asks for and privileges.

3. China provides economic aid in the form of interest-free or low-interest loans and extends the time limit for repayment when necessary so as to lighten the burden of the recipient countries as far as possible.

4. In providing aid to other countries, the purpose of the Chinese Government is not to make the recipient countries dependent on China but to help them embark step by step on the road of self-reliance and independent economic development.

5. The Chinese Government tries its best to help the recipient countries build projects which require less investment while yielding quicker results, so that the recipient governments may increase their income and accumulate capital.

6. The Chinese Government provides the best-quality equipment and material of its own manufacture at international market prices. If the equipment and material provided by the Chinese Government are not up to the agreed specifications and quality, the Chinese Government undertakes to replace them.

7. In providing and technical assistance, the Chinese Government will see to it that the personnel of the recipient country fully master such technique.

8. The experts dispatched by China to help in construction in the recipient countries will have the same standard of living as the experts of the recipient country. The Chinese experts are not allowed to make any special demands or enjoy any special amenities.

Mercy


Peace Without Justice is Oppression.


Several years ago I wrote that statement on a napkin and started to build a worldview of Peace and Social Justice around it.  Those of you who have been following my writing for some time might remember one of my first published articles that expanded on that exact statement.  If you like you can see the original postings here

 

My original thought centered around the fact that most Peacemakers and Peace keepering forces around the world are focussed on the belief that peace is simply the absense of violence and when the shooting stops they’ve done their job.  But when we take a closer look, a state of war and oppression can often continue long after, only to flare up in violence again at a later date.  Often times, what appears to be peace is not peace at all and just because the fighting has stopped does not mean the war is over.  In order to have a lasting peace we need to engage directly with those who may disagree, spend some time actively listening to their concerns and work towards justice.

 
At least that’s what I thought. 

 
Recently I was challenged in that belief by a friend of mine who pointed out that what Jesus taught wasn’t justice in the traditional sense, but mercy.  If we recognize our own sin and brokenness in everything and are really honest with ourselves about it what we really want for ourselves isn’t justice but mercy.  Justice says “you do the crime, you do the time” but mercy says “forgive and forget.”

 
In the teachings of Jesus this point is driven home in what has been called The Parable of The Unmerciful Servant.  Most people remember what Jesus said when Peter asked how many times he should forgive someone who sinned against him.  Seven times?  No Seventy-times seven!  But what we forget is that Jesus then went on the tell the story of the unmerciful servant.

 

Therefore, the kingdom of heaven is like a king who wanted to settle accounts with his servants. As he began the settlement, a man who owed him ten thousand bags of gold was brought to him. Since he was not able to pay, the master ordered that he and his wife and his children and all that he had be sold to repay the debt.  At this the servant fell on his knees before him. ‘Be patient with me,’ he begged, ‘and I will pay back everything.’ The servant’s master took pity on him, canceled the debt and let him go.  But when that servant went out, he found one of his fellow servants who owed him a hundred silver coins. He grabbed him and began to choke him. ‘Pay back what you owe me!’ he demanded. His fellow servant fell to his knees and begged him, ‘Be patient with me, and I will pay it back.’ But he refused. Instead, he went off and had the man thrown into prison until he could pay the debt. When the other servants saw what had happened, they were outraged and went and told their master everything that had happened. Then the master called the servant in. ‘You wicked servant,’ he said, ‘I canceled all that debt of yours because you begged me to. Shouldn’t you have had mercy on your fellow servant just as I had on you?’ In anger his master handed him over to the jailers to be tortured, until he should pay back all he owed. This is how my heavenly Father will treat each of you unless you forgive your brother or sister from your heart. [Matthew 18:23-35]

You see, the servant couldn’t pay his debt and he knew that the just thing to do would be to sell al of his possessions (including his family) and give the money to the master.  It wasn’t that he didn’t have the assets that he could liquidate and cover his obligations, the text is actually pretty clear that he did but the justice the situation required would have been quite painful.  I don’t know about you but I think selling my wife to pay off a loan would be pretty devistating for everyone involved.  So the servant asked for and received mercy, not justice.

 
The challenge for me, and hopefully for you, in this passage is this;  knowing how much I fail to show mercy on a daily basis, do I really want to follow a God that is only interested in justice?  Is it a good idea to only concern myself with what is just?  Or should I instead be focussed on mercy?

 
As a result of looking at this passage I’ve modified my original cocktail napkin scribble to read; Peace AND Justice without Mercy is SIN. And pray daily that I continue to show mercy, just has God has been merciful to me.

Daily Posting?


So I’m going to try an experiment.

I follow a lot of blogs. Most of them post way more than I do, at least once a day for a lot of them, some even more than that.  Personally I think more than once a day, unless you have something really  important to say is a bit excessive.  And I confess I don’t read everything, I mean honestly who has the time?

But here’s the thing.  Those bloggers who post a lot even though they might not have a lot to say are still doing something important.  They’re practising.  And you know what they say about practise….

So I’m thinking that I would like to post something everyday.

I’m not promising you Pulitzer Prize winning stuff and I don’t expect you to read everything thoroughly.  When I started this blog I had the goal of writing 500-700 word posts once a week.  I think I’ve done pretty well at that for the most part.  But if I’m going to use this medium to advance the cause of Meekonomics and since I’ve made a career change that more closely aligns with those goals, I need to be on here more.  The point is that The Meekonomics Project is meant to be a conversation and as the moderator of that conversation I need to speak up.

Forgive me in advance if I don’t follow through on this, and forgive me as well if some of what I write turns out to be rubbish, that’s what free-form conversations are all about.  If it takes me a while to get to the point and I have to slog through some crap to get there, so be it.  It’s a process and as I’ve said in the past, you get to see inside my mind while I work out some pretty hefty things.  If you stick with me, and help me edit my thoughts through your comments, together we might do something really interesting.

We’ll see how it goes.   That’s all I have for now, check back to tomorrow.

F.E.A.R.


It has now been a month since I quit my job of 12 years and left the only industry I have ever known.  I started my career in the music industry 19 years ago at the ripe old age of 20 but due to changing technology and a deep personal need for my wife to be closer to family we pulled up stakes and are starting over. 

At the age of 39 I hit the reset button on life.  Read all about it in my post, “Turning the Page” from September 21. 

Luckily we both had jobs to go to before our previous employment ended so that uncertainty was eliminated early.  My wife started even before I was finished my old job and I just started my new career this past Monday.  For the rest of 2011 I will be training to be a Financial Planner. 

As I mentioned in my previous post at the end of September, I want to do something that can mesh with the objectives of The Meekonomics Project.  What better place to start than in the world of insurance and investment planning?  I don’t know about you but I don’t know too many financial planners that could be considered meekonomists. 

Too often when we think of planning for the future we do so out of fear and financial planners are actually trained to play on those fears.  Fear that we might out live our money.  Fear that we might lose our jobs or become disabled.  Fear that we might be unable to provide for our needs, or the needs of those who depend on us.  But to a meekonomist fear needs to be a four letter word. 

A good friend of mine who I worked with in my music business days, a rapper who goes by the name of Manafest (www.manafest.ca), once said that fear stands for False, Evidence, Appearing, Real.  I love that definition but we all know that fear does not come from God.

For God has not given us a spirit of fear, but of power and of love and of a sound mind.  2 Timothy 1:7

You see, if you do your financial planning out of fear you are going to make bad decisions, you’re not acknowledging that you have a sound mind and you will miss opportunities.  Fear will paralyze you and not only prevent you from doing the very things you are afraid of, but more importantly from a meekonomics perspective, you might miss the opportunity to have a positive impact. 

Put simply, people who plan out of fear are the same people who are unable to respond to the needs of those around them.  That my friends is a direct violation of Jesus command to care for the sick and the needy, it is a denial of the fact that we are made to be in community with one another and it leads to isolationism.  Chronic fear is nothing short of a mental illness in our society to today.

Remember; the poster child for fear in financial planning is Ebenezer Scrooge.  Scrooge was afraid of everything and it separated him from the things we need as human beings in order to function in community.  It wasn’t until he put aside his fears and learned to live in the here and know that he truly started to live at all. 

Michael Bloomberg; mayor of New York City and former Wall Street tycoon once said that the best financial plan involves bouncing the cheque to the undertaker.  I love that too. That’s a man who understands that you can’t take it with you, so you mights as well give it all away.  As a meekonomist I can get behind that sentiment and as a financial planner I hope to show my clients that they can to.

An honest assessment of risk is one thing, that’s wise, but there is no place for fear in financial planning.

We Are the 99!


Over the last few weeks protesters have staged occupations of the financial districts in most major western cities in an attempt to send a message to big business and government.  The message is that the disparity between the wealthiest 1% and the remaining 99% of the population is far too wide and that something must be done to curb corporate greed.  These protests are a good thing.  They are helping to shine a light on some of the worst problems within our so-called market economy.  Problems like lax regulations and unfair tax systems to name just two.  Until the wealthiest among us recognize that the disparity is completely unsustainable and that in order to prevent a total collapse of the market economy they need to start leaving something on the table these types of protests will only grow and potentially become more violent.

But  as I watched the news coverage this past week something struck me as a tad odd.

The rallying cry of the protests everywhere from New York to Toronto,  London to Paris and beyond has become some variation of “We are the 99!”, which refers to the fact that the remaining 99% of the population is fed up.  The odd part is that in much of the industrialized world  the chant could just as accurately be “We are the 2 through 5”.

I wrote on this fact at the beginning of the year in my post “The 1$ Difference”  Even with the top 1% making billions, my middle class income puts me in the top 3% of the world.  So while chanting “We are the 99” is technically true it’s grossly disingenuous!

Stop for a second and consider the fact that if you live in a house, with electricity and in-door plumbing you are still by far, among the world’s wealthiest people and just $60,000 annually puts you in the top 3%.

Yes, the market economy is breaking down but for the subsistence farmer in east Africa or any other place in the developing world you can think of, the market economy never worked in the first place!

It’s not enough to close the gap between the top between the top few percentage points.  If you really want to make a difference you need to stop looking up the ladder at the handful of people out of 100 that are better off than you and start looking down at the vast numbers below you.  It will be far more effective for the world-wide economy in the long run if we focussed on helping those below us to move up than if we keep trying to figure out ways to raise ourselves.

So the next time you are tempted to chant “We are the 99!” remember, while you might not be the 1 – it’s very unlikely that you are any more than 4 or 5, on a list of 100.  Don’t believe me?  Punch in your annual income on The Global Rich List and see for yourself.

Citizen Kane; a Modern Tragedy


A few weeks ago I had the opportunity to sit down and watch this movie for the first time.  It was on Turner Classic Movies the same night as The Emmys.  I wouldn’t necessarily call myself a movie buff but I do love a good story and I really hate awards shows.  I find the whole concept of awards shows to be ego driven and narcissistic, two things I just can’t stand so I avoid them at all cost.   To me the most meaningful awards are given in private, between a few close associates, but that’s a post for another time.

I want to talk about Citizen Kane.

The film was released in the spring of 1941 just as America was emerging from the Great Depression but before the attack on Pearl Harbour that brought them in to WWII.  It was a time when the American psyche was peppered with a healthy scepticism of immodest wealth.  Not unlike today when you think about it.

The narrative follows the rise and fall of media tycoon Charles Foster Kane (Orson Welles) who, as the film opens, dies alone in his vast Florida estate surrounded by priceless objects of art and the trappings of success.  He was holding a snow globe and as it drops from his lifeless hand he whispers the word “Rosebud”.

The film unfolds through a series of flashbacks as a newsreel reporter named Jerry Thompson (William Alland) interviews figures from Kane’s past and seeks to find the meaning of his last word.  In the end Thompson gives up stating; “Mr. Kane was a man who got everything he wanted, and then lost it.  Maybe Rosebud was something he couldn’t get, or something he lost.”

As the credits begin to roll the camera pans back across Kane’s vast collection of priceless art and other possessions, the audience’s attention is drawn to a child’s snow sled as it is tossed into the furnace; the name on the sled is Rosebud.  As the sled burns the image is unmistakable, it is what he lost and alludes to his childhood as the only time in his life when Kane was truly happy.

I’ve been unpacking the message of Citizen Kane for the past several days and one bible verse has kept coming to mind;

What good is it for someone to gain the whole world, yet forfeit their soul? [Jesus; Mark 8:36]

You see, Meekonomics is based on the promise that the meek will inherit the whole world.  But what does that mean and what good is it if it costs us the one thing we take with us into eternity?

Charles Foster Kane was anything but meek.  He was brash, bold and extremely confident in himself but there are points within the story, especially early on where the audience gets a glimpse of his soul.

Charles Foster Kane: You know, Mr. Bernstein, if I hadn’t been very rich, I might have been a really great man.
Walter Thatcher: Don’t you think you are?
Kane: I think I did pretty well under the circumstances.
Thatcher: What would you like to have been?
Kane: Everything you hate.

And what was it that Thatcher hated?

Thatcher was the man who educated Kane, his  mentor and his guardian.  He was a lawyer who managed Kane’s money until he turned 25.  When Kane finished college and returned to New York to run a newspaper he wanted to use it as a platform to tell people the truth, no matter how ugly.  One of the things Thatcher hated was the truth.

Thatcher tried to teach Kane that rich men need to use their wealth to manipulate the truth and impose their will on lesser individuals.  Until his death Thatcher and Kane would be at odds on this point but in the end Thatcher’s vision won out.  The lure of money and power eventually seduced Kane into become exactly what Thatcher wanted; a rich man who was incapable of seeing just how much money and power effect the lives of countless people we may never meet.

When a middle aged Kane tries to garner support for the Spanish American War he is asked what his readers will think, “They’ll think what I tell them to think!” is his thundered response.   It’s clear at this point Kane has lost touch with the common man and can no longer see the effect his wealth has beyond what it can do for him.  Kane doesn’t give a second thought to the lives that will be lost and the immeasurable suffering war will bring, he sees only the increase in the value of his holdings that can be gained.  Sound familiar?

How many Kane’s are there today?  How many men on Wall Street, and Main Street for that matter, are there who measure life only by the balance sheet?  We are taught to “save for the future” but what future and at what cost?  Every dollar saved is a dollar not spent.  Spending money is what moves the economy, it’s what transfers wealth from one individual to another.  In short spending is what money is for!

Yes of course you need to have enough money saved up in order to survive through leaner times and through those years after we’ve all stopped working.  But how much is enough?  When does saving money stop being a responsible act of self preservation and become the sin of greed?  With over a billion people on earth surviving on less than one dollar per day it’s important to note that every dollar saved for your future is a dollar that someone else could use right now.

Don’t ever forget that spending money or just giving it away is as much of an act of love as anything you can do for someone else.  You may never see or even think about the people you are helping by doing this but there is always a person at the other end of every transaction.  The money you spend should always benefit that person not cause harm.

A Meekonomist knows and is mindful of the difference.

In one of the last scenes in the film Kane’s second wife Susan grows tired of living life isolated in a cold mansion that none of their former friends ever visits, so she decides to leave him.  He pleads with her not to go and tells her, perhaps for the first time, that he loves her but it is too late;

Susan Kane: Love! You don’t love anybody! Me or anybody else! You want to be loved – that’s all you want! I’m Charles Foster Kane. Whatever you want – just name it and it’s yours! Only love me! Don’t expect me to love you.

Susan walks out of his life and Kane is left to rot in complete isolation, surrounded only by his possessions and a small staff for the rest of his life.

Citizen Kane is a Hollywood Classic but it is also a modern tragedy.  A tragedy that continues to unfold daily in the lives of countless individuals who fail to understand the true value and purpose of money;

Look at the birds of the air; they do not sow or reap or store away in barns, and yet your heavenly Father feeds them. Are you not much more valuable than they? [Jesus; Matthew 6:26]

Thompson: He made an awful lot of money.
Bernstein: Well, it’s no trick to make a lot of money… if what you want to do is make a lot of money.